Fresno County Could Spiral Downward

400,000 Acres or More May Remain Fallow

 

By Patrick Cavanaugh, Editor

Top in the News for farmers:
·               Affordable Care Act—it doesn’t matter now.
·               High Speed Rail, no worries.

·               Farm Bill, same.

Water Flows, but Ag May Get Zero in 2014

Water—the only thing that farmers care about right now.  Without water, nothing else matters.
And nowhere is the worry greater than in the Federal Water Districts, such as Westlands, San Luis, and Panoche; all Westside water allocations throughout Fresno County and other counties of the Central Valley will be severely cut.
In 2009, with a 10 percent water allocation, more than 300,000 acres of land in Fresno County were fallowed causing tens of thousands of farm workers to lose their jobs, thrusting many Westside farm communities into catastrophic 40 percent unemployment, and requiring weekly food lines to be established to feed those affected.
Then came 2013 with a 25 percent allocation—moving many farm operations towards an exit strategy because their last resort is to use poor quality well water, high in salt and boron.
But 2014, with a possible zero percent allocation, Westside farmers in federal water districts may not plant an estimated 400,000 acres of row crops and use whatever water they have for their permanent crops such almonds pistachios and wine grapes. Land destined for annual row crops such as fall lettuce, tomatoes, melons, garlic, onions, and peppers most likely will lay idle. Cotton, even with a good market price, would not be planted on thousands of acres.
While not as bad as the Westside prospects, Eastside farms from Fresno County to Kern County, served by the Federal Friant-Kern Canal, are also hurting with dramatically reduced allocations this year that would be worse next year, without significant rain
Fresno County has been #1 in the nation in agricultural gross production ever since it was statistically measured. In fact, the value in 2012 was $6.6 billion. However, in 2014, Fresno County could very well lose its top-of-the-mound status due to fallowed land.

This coming year, Tulare County, which rang up $6.2 billion last year, could eclipse Fresno County for the first time.

Mark Borba
And the numbers for Fresno County could get exponentially worse when it comes to agriculture’s multiplier effect on the economy.
Mark Borba, co-owner of Borba Farms, a diversified family operation in Riverdale, southwest of Fresno, farms row crops. “The average per acre gross revenue on row crops such as cotton, tomatoes, garlic, onions, melons and lettuce is around $3,500 per acre. The minimum multiplier for the economy for gross agricultural production dollars is 3.5, or $12,250 per acre,” Borba said. “When that number is multiplied by what I think will be 250,000 acres, the loss revenue becomes $3 billion. If the idled acreage reaches 400,000, the resulting $4.9 billion in losses would be due to lost gross revenue of crops on that acreage.
William Bourdeau

William Bourdeau, Executive Vice President of Harris Farms, said that with a possible zero allocation, the company would have to idle 9,000 acres of row crop ground from their 14,000 acres of farmland. “We’re not planting at all,” said Bourdeau. “We will only use what water we have for our permanent crops, which include almonds, pistachios, wine grapes and asparagus.

The use of well water on permanent crops in 2014 will be higher than ever before in 2014. The high salts and boron in that water damage almonds in particular. Recent damage has led to reduced yields in many areas on the Westside. Further use cause long-term damage to trees, which reflect in lost revenue for growers and Fresno County.
“If there is any available water, it could cost the extraordinary price of $1200 per acre foot,” noted Borba.  “Growers would have to pump more well water, which is already being severely over-drafted.”
“If there are no surface water deliveries, the water prices would be too high to make any economic sense,” said Bourdeau.
“Well water quality is very bad and the only thing we can put it on are pistachios and asparagus. None of the specialty crops such as tomatoes or lettuce can handle it,”
said Bourdeau.
“One unplanted crop, lettuce for example, would constitute a significant economic hit in Fresno County. The loss impact would be huge,” he said. “We have a fall and a spring crop, about 1500 acres each. To plant and harvest those 3,000 acres, it takes about 700,000 man-hours,” Bourdeau said.
“Typically if we get a good yield, we produce about 1,000 cartons of lettuce per acre.  Three thousand acres equates to 3 million cartons. Each carton has 24 heads of lettuce, and that equals 72 million heads of lettuce that we would not harvest and put into the market,” said Bourdeau. “And that’s just lettuce; we grow lots of different crops. No doubt this would be multiplied hundreds of times over in the event of a sure and stark zero water allocation.”
“The impact would be devastating and would take a human toll. We have really good people, they are hard working and they want to work. And we are not going to be able to provide them with jobs because of misguided government regulations,” said Bourdeau. “The foundation of the government’s ambition is flawed in that it would not be saving the fish species, but it would be damaging people. And it’s not just the farmer; it’s the farm worker, it’s the economy, it’s the local government, and it would be colossal.”
“Since the San Joaquin Valley economy is based on agriculture, this lost revenue would have an enormous ripple effect—a big and wild swing,” noted Borba.
Just to name a few of the direct services and suppliers that would see a major dip in revenue:
·               Equipment Dealers
·               Truck Dealers
·               Fuel suppliers
·               Custom Spray Services
·               Seed Dealers
·               Auto Parts Suppliers
·               Irrigation Suppliers
·               Fertilizer Suppliers
·               Custom Applicators

·               Harvesting crews

·             Processors of tomatoes, garlic, onion and cotton

·               Crop protection suppliers

·               PCA’s

·               All taxes, fuel, state and federal

Borba said he placed an order with Fresno Equipment earlier this year for four John Deere Tractors, for a total value of about $800,000. “The Carl Moyer program was going to kick in $368,000 because I was upgrading to cleaner emission tractors. When I heard of the possible zero allocation for next year at a May meeting at the Huron office of Westlands Water District, I had to turn the whole deal off,” Borba said.  “I also had five Ford pickups on order at a Fresno Dealership to replace aging trucks on the ranch. I had to cancel that order too. That’s a tremendous ripple effect just from our farming operation,” Borba noted.

This Coming Year Is Different

By Patrick Cavanaugh, Editor

It would be radically different in 2014.  In 2009, many row crop fields did get planted and were irrigated with ground water supplies. But today, ground water supplies and quality are far worse than 2009, which will limit its use for irrigation in 2014.
Stuart Woolf
“We are just going to have to pump more, and this drives me crazy because we all put buried drip irrigation in the ground, and we pump salty water through it,” said Stuart Woolf, president and CEO of Woolf Farming with operations in Huron. “We’re not spreading the salt, we are concentrating it through our drip lines poisoning the drip lines.
“Our investments in conservation are biting us in the tail. It’s hard to be hopeful knowing we will have to rely on even more well water this coming year,” said Woolf.
And the valiant farm workers and other farm employees would be impacted worse than they were in 2009. “They grow our food and fiber every day, and they would suffer terribly by the water restrictions,” noted Mark Borba of Borba Farms, headquartered in the Fresno County area west of Riverdale.
“They live, eat, drink, breathe and sleep the American Dream, and because of Washington Bureaucrats, many would lose it all. Farm workers would lose their homes and the healthcare that I provide. It would be devastating,” Borba said.
Manuel Cunha
According to Manuel Cunha, President of the Nisei Farmers League, “the combination of the two most powerful controlling factors for the agricultural industry in California is water allocation, no matter if it’s State or Federal Projects, and Immigration Reform because our industry would be shattered without farm workers.”
“Let’s say for the next six months we get 28 inches of rain, but if we don’t pass the Immigration bill, and therefore have no available workers, farmers could plant all the tomatoes and onions and other crops they want, but there wouldn’t be anyone to harvest,” said Cunha.
Cunha noted that shutting off the water supply would drive thousands of farm employees out of the area when they lose their jobs. “They would leave the farm and not come back,” said Cunha.
“We have to make farming decisions without knowing how much water we will get. Therefore, our annual business model is based upon worst-case scenarios. It’s a terrible way to do business,” said Woolf.
Jesus Cuevas
How can I ask tomato production manager, Jesus Cuevas, to go plant three thousand acres when we may not have water? That could be a huge mistake,” Woolf said. “Instead, we have to figure out a plan on what we can grow with zero surface water, and reduce the tomato acreage. We are already planning to reduce onions and garlic and to fallow a lot of ground.”
“What water we have, we will prioritize to our permanent crops,” Woolf remarked. “We go through all these decisions, only to find out several months later whether or not they were good or not. It’s very difficult to manage your resources very well when you don’t know what your resources are.”
Woolf continued, “We live in a state that has a mountain range which collects snowfall every year. On average, we get something like 200 million acre-feet of annual precipitation in California. The Central Valley represents about 9 million acres that we irrigate—or about 9  percent of the total land in the State. We’ve spent hundreds spent hundreds of millions of taxpayer dollars to build the projects… and the choose not to use them? The opportunity cost is horrendous. Think of the lost jobs, income, tax base, etc. It’s criminal to hammer the Valley this way… while having little if any impact to the wellbeing of the Delta. 
Todd Allen farms 600 acres of row crops in Westlands Water District, near Firebaugh. He has no wells, so he must rely strictly on Westlands deliveries of 2.6 acre-feet per acre. In 2009, Allen harvested 40 acres out of 600 due to the regulatory drought.

In 2011, he farmed everything. But in 2012, he idled 150 acres, and in 2013, he idled 225. “If I am able to get water from Westlands that I did not use last year, I may be able to pre-irrigate 150 acres of cotton or tomatoes next spring, and then hopefully the Bureau will announce an allocation so that I can finish the crop.”

Allen noted, “The situation now is more dire than ever. I have been really thinking about finding someone to buy me out so that I can get out. When we started out with 25 percent this year, and they reduced it to 20 percent a few weeks later, it really kicked me when I was down,” Allen said.
His brother, Joel Allen, farms 1,000 acres; also in Westlands’ all row crops. “I’m not in any position to put in permanent crops simply because I have not had the means, and I cannot get the support of any banks that are willing to step forward and help someone out in our district.”
Joel Allen
“This year with only 20 percent water allocated, there were many nights that I lay awake wondering how I was going to make it,” Joel Allen said. “As for 2014, we all want to think that it’s going to rain and that things will work themselves out, but if I have to make a decision on my workforce, I probably will not bring anyone back. We’ve already shaved our workforce from 10 people down to two. It’s a struggle finding work for those two, keeping them busy, and that really hurts because I know my employees have rent to pay and mouths to feed, and everyday expenses like I do.”
“If growers have to make plans for a low water delivery, you are talking about very expensive water to buy,” said Vernon Crowder, Rabobank Senior Vice President and Senior Analyst, Food and Agribusiness Research Advisor Group.
“If growers are dependent upon pump water, they are worried about its quality and what that means to certain crops, especially almonds. The big issue is what can be taken out of the Delta to fill the San Luis Reservoir.”

“Even if we invest in all the water project improvements that the original Water Bond addressed, regarding Delta Conservation, new storage, and even the twin tunnel idea fully backed by the Governor, none of these would happen for 20 years,” said Crowder. “So we need to improve the process of getting through reduced water allocations right now. I believe farmers are going to press the state for help in making water conveyance better and faster.”