This is the seventh post in my series Drought in California. In Part 1: California Climate and Drought, I found that drought is projected to be the “new normal” climate in California. In Part 2: The Status of California’s Current Water Resources, I found that California is already depleting both it’s groundwater and surface water resources. In Part 3: California’s Total Water Deficit, I constructed an overall estimate of California’s future water deficit, concluding that it will be about 25.1 million acre-feet per year, about 39% of California’s current dedicated water supply. In Part 4: The Potential to Procure Additional Ground and Surface Water, I found that a variety of obstacles and problems made it unlikely that California could cover the predicted future water deficit by tapping additional groundwater or surface water resources. In Part 5: The Potential of Desalination, I found that using desalination to cover the projected water deficit was within the realm of conceptual possibility, but it would be costly and would involve a massive infrastructure program. In Post 6: Conserving Water – Population and Environment, I discussed water consumption terminology and also concluded that conserving water by voluntarily limiting population growth or by stealing it from the environment would be objectionable due to severe negative effects.

In this post I will discuss the possibility for increasing agricultural water efficiency. At the beginning of each part of this series, I have noted that there are problems with the type of exercise I’m attempting, and with the data and analyses I’m having to use. If you want to read more about it, see the introduction to the series.

The Potential for Increased Agricultural Water Efficiency

Irrigation consumes 76% of California’s water, some 28.3 million acre-feet per year. Most of the irrigation is agricultural. (USGS, 2005) Because it is the largest consumer of water, agriculture is a prime target for water conservation. If the projected water deficit of 25.1 million acre-feet were prorated according to consumption, then 76% of the deficit would belong to agriculture, or about 19.0 million acre-feet per year. That represents about 69% of current agricultural consumption.

(Click on graphics for larger view.)

Some 77,900 California farms and ranches received $46.3 billion for their output in 2013, accounting for 12% of the national farm income total. California farms produced about 69% of the fruits and nuts produced in the USA, and 36% of the vegetables and melons. The top 10 agricultural commodities in California were (in order): milk, almonds, grapes, cattle, strawberries, walnuts, lettuce, hay, tomatoes, and nursery plants. (California Department of Agriculture, USDA) California is the sole U.S. producer (99% or more) of artichokes, dates, figs, raisin grapes, kiwifruit, olives, Clingstone Peaches, pistachios, dried plums, pomegranates, sweet rice, Ladino Clover seed, and walnuts. Thus, not only is California agriculture an essential industry within the state, but it is an essential contributor to the entire nation’s food supply. (USDA Pacific Regional Field Office, 2015)

In 2013, the average value of California farm real estate was $6,900 per acre, but irrigated land was valued at $11,800 per acre, an increase of 2.9% from 2012 (the drought is causing non-irrigated land to decline in value, but irrigated land to increase in value). The amount of land devoted to farming in California was 25.5 million acres. The total value of the farm land is about $176 billion. (USDA Pacific Regional Field Office, 2015). Direct farm employment in California in 2014 was 417,200, with an unknown number of other workers indirectly dependent on farming (anybody who sells equipment or services to farms or farmers). (Employment Development Department, 2015)

In 2012, California’s top 10 counties by production were Fresno, Kern, Tulare, Monterey, Merced, Stanislaus, San Joaquin, Kings, Ventura, and Imperial. Seven of them are in the Central Valley. Monterey County is in the Central Coast Region (John Steinbeck’s The Grapes of Wrath was set in Monterey County). Ventura County is in the South Coast Region, just north of Los Angeles. Imperial County is in the Mojave Desert, along the border with Mexico. All of these counties are dry counties – the crops depend on irrigation for survival.

The potential for increased water efficiency in California agriculture is controversial, with estimates varying widely. Theoretical calculations of potential water conservation appear to be large, but the real-world potential appears to be much smaller. For instance, focusing on the San Francisco Bay Delta, a group at the Pacific Institute wrote that up to 3.4 million acre-feet could be conserved via 4 modest strategies: crop shifting, smart irrigation scheduling, advanced irrigation management, and efficient irrigation technology. A group at the Irrigation Training & Research Center attacked the Pacific Institute paper, however. In their opinion, smart irrigation scheduling, advanced irrigation management, and efficient irrigation technology were already widely adopted on California farms. As for crop shifting, they felt that it could not be accomplished because the land was not suitable for the proposed shift, and because it would create increased supply in certain crops without creating increased demand to receive it. In addition, they felt that the Pacific Institute group had completely ignored the economic implications of their recommendations, and had fundamentally misunderstood the way in which practices on individual farms translate into basin-wide water dynamics. (Cooley, Christian-Smith, and Gleik, 2008; Burt et al, 2008.)

An instructive example of economic implications might involve nuts. Acreage devoted to the production of nuts has exploded in California: pecan acreage increased by 52% in 2013, and almond acreage increased by 33%. They are very profitable: almonds were the second leading commodity in California, and walnuts were sixth. They are a long-term crop, however: nuts grow on trees, and it takes several years before a nut tree begins producing. Thus, farmers have a significant investment of capital and time in their nut groves.

The water needs of nuts are interesting, however. They require almost 1,200 gallons of water per pound to grow (almost 9 times as much as milk, almost 3 times as much as eggs). (Mekonnen and Hoekstra, 2012) They would appear to be a good candidate for the crop shifting strategy recommended by the Pacific Institute group. Shifting, however, would require farmers to abandon their significant capital investment, as well as one of the most profitable crops in all of California.

Complicating this scenario is the arcane system of water rights that exists in most western states, including California. Water rights were established in the 1800s and early 1900s. The basis was first come, first served. The first person on the scene made a claim to withdraw a certain quantity of water from a water source. The second person did likewise, and so on. Over time, the claims accumulated. In wet years, the water resource can supply all of the claims, but not in dry years, there just isn’t enough to go around. In those years, water is not prorated. Rather, the senior claim gets the full allotment. Then the second most senior claim, then the third, and so on until there is no more to distribute. It is a controversial system, but it has existed for a very long time, and it is well established in law. (Wikipedia, Water Right)

The effect of this system is that senior water rights holders get all the water they need during dry years, while junior holders go completely without. In those years, junior holders typically allow some of their fields to lie fallow. But you can’t do that with nut trees; they need water every year, or the trees will die. Thus, junior holders may choose to plant something other than nut trees. But if you are a senior water holder, why would you shift out of nuts? You are likely to get all the water you need, it is very profitable, and if you shift, you’re going to take an economic hit. The only problem for the senior rights holder is if water distributions are cut off entirely.

Easy, inexpensive solutions like those proposed by the Pacific Institute paper are often called “low hanging fruit.” I can’t evaluate whether low hanging fruit is a real opportunity in California, or whether it is largely illusory. I do feel constrained to observe, however, that agriculture has existed in California for many decades, water scarcity has been a problem for equally as long, and California has developed the most extensive water collection and diversion system in the country. The system has been very expensive and very controversial. Given these facts, it seems that claims for easy, inexpensive solutions should be evaluated with caution. Even where water conservation is possible, it seems likely to result in increased operating costs to the farmer, and shifting to less profitable crops. Thus, farm income will be reduced.

Those who advocate increased agricultural water efficiency sometimes point to the example of Israel, a model of desert farming efficiency. Israel’s agricultural accomplishment is, indeed, admirable. However, there are important differences that may make Israel a poor model for California. For one, in Israel they don’t farm all of the various crops that they do in California. For another, it is a very small country: more than 20 Israels could fit in California, almost 3 in the Central Valley alone. Further, it is more densely populated: 4.3 times as densely populated as all of California, and 3.6 times as densely populated as the Central Valley. These differences matter, for instance, because Israel strictly limits the amount of fresh water to farms, making up for it with reclaimed water from urban areas and brackish water. The larger size of California means that infrastructure to supply reclaimed water would have to be much more extensive in California than in Israel. In addition, Israel’s higher population density means that per acre of farmland, there is more urban water available for reclamation. (Israel Export & International Cooperation Institute, 2012)

The California Legislative Analyst’s Office concluded that agricultural water efficiency could conserve about 0.5 million acre-feet of water per year, at a cost of just under $6,000 per acre-foot. (Legislative Analyst’s Office, 2008) That is a tiny fraction of the projected water deficit.

Water deliveries out of the California State Water System were cut off to many farmers in 2014, and the State Water Resources Control Board just announced further cutbacks. Water rights dating as far back as 1903 will be restricted, and restrictions will grow as the summer goes on. (Medina, 2015) The result has been the drilling frenzy discussed in Part 2 of this series, as farmers seek to maintain production by substituting groundwater. How long they can continue to do so is unknown. In Post 2 I discussed the limits of that strategy: it threatens not only to drain the aquifer, but also to harm its ability to hold water when a wetter cycle returns. In addition, a group of farmers has threatened to challenge in court the state’s ability to make such cutbacks. It is hard to believe that California would ask so many of its citizens to endure great hardship so that senior water holders could continue to grow nuts. However, the existing system of water rights is deeply and firmly entrenched in law. Taking water away from senior holders would involve taking away a very important property right. It would be highly contentious, and it is not inconceivable that the Supreme Court would rule in favor of the water holders.

Certainly, California’s agricultural sector can reduce its consumption of water. All that is required is to abandon their fields and stop farming. If this were to be the direction California follows, then the economic consequences would be hard to predict. However, if one simply assumed that, since water consumption would have to be reduced by 67%, then 67% of California’s agricultural production would be lost, and 67% of the farmland would be lost, and it would amount to a loss of $31 billion in annual farm receipts, and $118 billion in farmland, not to mention all the equipment on those farms. About 280 thousand people would be thrown out of work. I don’t know how many of those whose lives are indirectly dependent on farming would become unemployed, but if one assumes that it would be 1/3 as many, then some 372 thousand people would be unemployed in total. That represents about 2% of California’s civilian employment, though the unemployment would be concentrated in the agricultural counties, not spread throughout the state. And finally, farmers usually operate on bank credit. The failure of 67% of the farms in California would create significant strains on the banking system, and the recent Great Recession has shown us how much havoc stress on the banking system can create.

The above paragraph makes it sound like the effects would all occur at once, in one year. If the drought and lack of snowpack continue as they have the last two years, the effects may, indeed, be concentrated into a single year, or two, or three. But if a wetter cycle returns, with the decline in the snowpack occurring gradually through mid-century, then the effects would be more gradual, spread over many years.

In summary, agriculture is the largest consumer of water in California. The sector’s prorated share of the water deficit would amount to slightly more than 2/3 of its current water consumption. While nobody is claiming that the sector can make that big a reduction in water consumption, there are a variety of sources claiming that large improvements in California’s agricultural water efficiency are easily and affordably achievable. However, there is reason for skepticism, and the conclusion of the Legislative Analyst’s Office is that only a very small improvement is achievable.

The alternative would be for a large portion of California’s agriculture to be lost, resulting in loss of income, loss of assets, stress on the banking system, and possibly a 2% increase in unemployment statewide. In addition, the entire United States would feel the effects, as more than 5% of our food supply would be lost, including 22% of our supply of vegetables and melons, and about 46% of our fruits and nuts.

My best guess, and it is mostly a guess, is that if cooperation occurs, then some water conservation will be achievable, more than the amount estimated by the Legislative Analysts Office. However, it will be nowhere the amount needed to cover the projected deficit. I have no idea how the issue of water rights will be resolved, but I expect that it will be highly contentious. I expect that a significant amount of California’s agricultural output will be lost, and a significant portion of its farms will fail and be abandoned. I expect that the effects will ripple through the communities which depend on and support California’s agriculture, causing significant hardship and economic dislocation. Over what period of time all this will occur depends on how the drought continues to unfold, as well as many human factors.

Sources:

Burt, Charles, Peter Canessa, Larry Schwankl, and David Zoldoske. 2008. Agricultural Water Conservation and Efficiency in California – A Commentary. Unpublished paper. Retrieved online 6/12/15 at http://www.itrc.org/papers/commentary.htm.

California Department of Food and Agriculture. California Agricultural Production Statistics. Web page accessed 6/12/15 at http://www.cdfa.ca.gov/statistics.

Cooley, Heather, Juliet Christian-Smith, and Peter Gleick. 2008. More With Less: Agricultural Water Conservation and Efficiency in California. Oakland, CA: Pacific Institute. Retrieved online 6/12/15 at http://www.pacinst.org/wp-content/uploads/sites/21/2013/02/more_with_less3.pdf.

Employment Development Department. 2015. Industry Employment & Labor Force – by Annual Average. An Excel spreadsheet created 5/22/15 by the Labor Market Information Division of the California Employment Development Department, and downloaded 6/14/15 at http://www.labormarketinfo.edd.ca.gov/LMID/Employment_by_Industry_Data.html.

Israel Export & International Cooperation Institute. 2012. Israel’s Agriculture. Retrieved online at http://www.moag.gov.il/agri/files/Israel%27s_Agriculture_Booklet.pdf.

Legislative Analyst’s Office. 2008. California’s Water: An LAO Primer. Retrieved online at http://www.lao.ca.gov.

Medina, Jennifer. 6/12/15. “California Cuts Farmers’ Share of Scant Water.” New York Times. Retrieved online 6/14/15 at http://www.nytimes.com/2015/06/13/us/california-announces-restrictions-on-water-use-by-farmers.html?ref=earth&_r=0.

Mekonnen and Hoekstra. 2012. “A Global Assessment of the Water Footprint of Farm Animal Products. Ecosystems. 15: 401-415. Downloaded from http://waterfootprint.org/media/downloads/Mekonnen-Hoekstra-2012-WaterFootprintFarmAnimalProducts.pdf.

USDA. “Cash Receipts by Commodity, 2010-2014F.” U.S. and State-Level Farm Income and Wealth Statistics. Economic Research Service. Web data portal accessed 6/12/15 at http://www.ers.usda.gov/data-products/farm-income-and-wealth-statistics/annual-cash-receipts-by-commodity.aspx.

USDA Agricultural Research Service. “Blue Orchard Bee.” http://www.ars.usda.gov/Research/docs.htm?docid=18333.

USDA Pacific Regional Field Office, California. 2015. California Agricultural Statistics 2013 Annual Bulletin. Sacramento, CA: Pacific Regional Field Office, National Agricultural Statistics Service. Available online at http://www.nass.usda.gov/Statistics_by_State/California/Publications/California_Ag_Statistics/2013cas-all.pdf.

USGS. Estimated Use of Water in the United States. County Level Data for 2005. http://water.usgs.gov/watuse/data/2005.

Wikipedia. Water right. Viewed online 6/12/2015 at https://en.wikipedia.org/wiki/Water_right.