UC Davis Drought Study Assesses Current Losses and Potential Future Impacts

Source: CDFA

A new report from the University of California, Davis, shows that California agriculture is weathering its worst drought in decades due to groundwater reserves, but the nation’s produce basket may come up dry in the future if it continues to treat those reserves like an unlimited savings account.

The UC Davis Center for Watershed Sciences study, released today at a press briefing in Washington, D.C., updates estimates on the drought’s effects on Central Valley farm production, presents new data on the state’s coastal and southern farm areas, and forecasts the drought’s economic fallout through 2016.

The study found that the drought — the third most severe on record — is responsible for the greatest water loss ever seen in California agriculture, with river water for Central Valley farms reduced by roughly one-third. Groundwater pumping is expected to replace most river water losses, with some areas more than doubling their pumping rate over the previous year, the study said. More than 80 percent of this replacement pumping occurs in the San Joaquin Valley and Tulare Basin.

The results highlight California agriculture’s economic resilience and vulnerabilities to drought and underscore the state’s reliance on groundwater to cope with droughts. “California’s agricultural economy overall is doing remarkably well, thanks mostly to groundwater reserves,” said Jay Lund, a co-author of the study and director of the university’s Center for Watershed Sciences. “But we expect substantial local and regional economic and employment impacts. We need to treat that groundwater well so it will be there for future droughts.”

Other key findings of the drought’s effects in 2014:

  • Direct costs to agriculture total $1.5 billion (revenue losses of $1 billion and $0.5 billion in additional pumping costs). This net revenue loss is about 3 percent of the state’s total agricultural value.
  • The total statewide economic cost of the 2014 drought is $2.2 billion.
  • The loss of 17,100 seasonal and part-time jobs related to agriculture represents 3.8 percent of farm unemployment.
  • 428,000 acres, or 5 percent, of irrigated cropland is going out of production in the Central Valley, Central Coast and Southern California due to the drought.
  • The Central Valley is hardest hit, particularly the Tulare Basin, with projected losses of $810 million, or 2.3 percent, in crop revenue; $203 million in dairy and livestock value; and $453 million in additional well-pumping costs.
  • Agriculture on the Central Coast and in Southern California will be less affected by this year’s drought, with about 19,150 acres fallowed, $10 million in lost crop revenue and $6.3 million in additional pumping costs.
  • Overdraft of groundwater is expected to cause additional wells in the Tulare Basin to run dry if the drought continues.
  • The drought is likely to continue through 2015, regardless of El Niño conditions.
  • Consumer food prices will be largely unaffected. Higher prices at the grocery store of high-value California crops like nuts, wine grapes and dairy foods are driven more by market demand than by the drought.

If the drought continues for two more years, groundwater reserves will continue to be used to replace surface water losses, the study said. Pumping ability will slowly decrease, while costs and losses will slowly increase due to groundwater depletion. California is the only state without a framework for groundwater management.

“We have to do a better job of managing groundwater basins to secure the future of agriculture in California,” said Karen Ross, Secretary of the California Department of Food and Agriculture, which largely funded the UC Davis study. “That’s why we’ve developed the California Water Action Plan and a proposal for local, sustainable groundwater management.”

Failure to replenish groundwater in wet years continues to reduce groundwater availability to sustain agriculture during drought — particularly more profitable permanent crops, like almonds and grapes — a situation lead author Richard Howitt of UC Davis called a “slow-moving train wreck.”

JUST IN: UC Davis’ Preliminary Findings on Drought Impact in Central Valley

Source Office of Public Affairs

Photo Source-Aquafornia

California’s drought impact will be a severe blow to Central Valley irrigated agriculture and farm communities this year and could cost the industry $1.7 billion and cause more than 14,500 workers to lose their jobs, according to preliminary results of a new study by the UC Davis Center for Watershed Sciences.

Researchers estimated that Central Valley irrigators would receive only two-thirds of their normal river water deliveries this year because of the drought.

The preliminary analysis represents the first socio-economic forecast of this year’s drought, said lead author Richard Howitt, a UC Davis professor emeritus of agricultural and resource economics.

“We wanted to provide a foundation for state agricultural and water policymakers to understand the drought impact on farmers and farm communities,” Howitt said.

The Central Valley is the richest food-producing region in the world. Much of the nation’s fresh fruits, nuts and vegetables are grown on the region’s 7 million acres of irrigated farmland.

The center plans to release a more comprehensive report of the drought’s economic impact on the state’s irrigated agriculture this summer.

The analysis was done at the request of the California Department of Food and Agriculture, which co-funded the research, along with the University of California.

“These estimates will help the state better understand the economic impacts of the drought, ” said CDFA Secretary Karen Ross. “The research confirms where emergency drought assistance will be needed most, and efforts are already underway.”

The UC Davis researchers used computer models and the latest estimates of State Water Project, the federal Central Valley Project and local water deliveries, plus groundwater pumping capacities to forecast the economic effects of this year’s drought.

The analysis predicted several severe impacts for the current growing season, including:

▪Reduced surface water deliveries of 6.5 million acre-feet of water, or 32.5 percent of normal water use by Central Valley growers. An acre-foot is enough water to cover an acre of land in a foot of water, or enough water for about two California households for a year.

▪ Fallowing of an additional 410,000 acres, representing 6 percent of irrigated cropland in the Central Valley.

▪ The loss of an estimated 14,500 seasonal and full-time jobs. About 6,400 of these jobs are directly involved in crop production.

▪ A total cost of $1.7 billion to the Central Valley’s irrigated farm industry this year, including about $450 million in additional costs of groundwater pumping.

▪ About 60 percent of the economic losses will occur in the San Joaquin Valley and Tulare Lake Basin.

Growers are expected to replace much of the loss in project water deliveries with groundwater, California’s largest source of water storage during drought years, said co-author Jay Lund, director of the Center for Watershed Sciences and a UC Davis professor of civil and environmental engineering.

“Without access to groundwater, this year’s drought would be truly devastating to farms and cities throughout California,” Lund said.

The additional pumping will cost an estimated $450 million and still leave a shortage of 1.5 million acre-feet of irrigation water, about 7.5 percent of normal irrigation water use in the Central Valley, according to the forecast.

While the current drought is expected to impose major hardships on many farmers, small communities and the environment, it should not threaten California’s overall economy, Lund said.

Agriculture today accounts for less than 3 percent of the state’s $1.9 trillion a year gross domestic product.Other authors on the report are UC Davis agricultural economist Josue Medellin-Azuara and Duncan MacEwan of the ERA Economic consulting firm in Davis.