Carrot Has Tunnels From Carrot Rust Flies. The carrot rust fly larvae tunnel through carrots, disgorging a rust-red sawdust-like material as they work. Usually the foliage is unharmed, but it sometimes turns yellow if the infestation is serious. Active in the Northeast and Northwest, the adult fly lays its eggs on the soil around the carrot in late spring and again in summer. The resulting larvae are yellowish white maggots, about 1/3 inch long. Usually the second generation of these pests does the most harm. Carrots with only a few tunnels are still edible; just cut away the damaged part. However, do not store any carrots that have tunnels, as the larvae may still be inside and will destroy the carrot. Once the pest has struck, there is nothing much you can do for an infested carrot crop. If you plan several subsequent crops over the season, spray the soil with a product containing predatory nematodes. These microscopic roundworms will enter the soil and seek out the rust fly larvae to lay their eggs in, killing them. Prevent the flies from laying their eggs on the young carrots by covering newly sown seed with garden fleece. Leave it in place until the plants are mature.