The San Joaquin Valley is the agricultural powerhouse of the United States and California. California accounts for an eighth of U.S. farm sales, largely because it produces high value fruit and nut, vegetable and melon, and horticultural specialty (FVH) crops such as nursery products and flowers. Over three-fourths of the state's $37 billion in farm sales in 2010 were crop commodities, and almost 90 percent of the $28 billion in California crop sales represented labor-intensive FVH commodities.
About half of California's farm sales and farm employment are produced in the eight-county San Joaquin Valley with four million residents that stretches from Stockton in the north to Bakersfield in the south. The leading U.S. farm county is Fresno, which had farm sales of almost $6 billion in 2010.
California has about eight million acres of irrigated crop land. A third is planted to perennial fruit and nut crops, a third to field crops such as cotton and rice, and a third to crops that are fed to animals, such as alfalfa and corn. The rising share of crop land planted to perennials has "hardened" the demand for irrigation water, since they must be watered even in drought years.
For example, 15 percent of the land in the Westlands Water District is planted to almonds, up from five percent in 2000.
In a normal year, about two-thirds of the water used in agriculture is surface water, captured in dams and reservoirs in northern California and transported south via canals to farmers. The other third is groundwater pumped from underground aquifers. Drought reduced the amount of surface water available to farmers by 6.6 million acre feet in 2014 compared with normal years, but farmers compensated by pumping an additional five million acre feet of groundwater.
With reduced supplies of water devoted mostly to high-value perennial crops, there were small reductions in farm sales and farm jobs in 2014. Between 420,000 and 700,000 acres of the state's eight million irrigated acres were fallowed in 2014, reducing crop sales by up to $810 million.
The main worry is how to respond to a drought in 2015 and beyond. Groundwater aquifers are a shared resource: as some farmers dig ever-deeper wells, they force others who share to same aquifer to dig deeper as well.
California was the last western state to regulate groundwater pumping. A package of bills enacted by the state in 2014 creates local groundwater sustainability agencies to register private wells, monitor the water-measuring devices that must be attached to pumps, and regulate groundwater pumping. These new agencies will impose fees on well owners to finance their activities.
Economists have proposed that landowners in each groundwater basin receive the share of sustainable water extraction that reflects their share of land in the basin. The sustainable share of groundwater that could be pumped from the basis would be the average amount extracted and replenished during a decade of "normal" weather.
Landowners could extract their sustainable share of the groundwater in the basin for the cost of pumping. However, if they took more, they would have to pay to replace their excess withdrawal. Under such a scheme, there would be no restrictions on groundwater pumping, but excess water extractions would result in payments to the water district that could go to farmers who fallow land and make more water available to others or be used to buy water from outside the basin for replenishment.
Orange County has since the 1960s used a version of this cap-and-trade system to manage the extraction of groundwater and prevent salt water intrusion. Economists hope that the challenge of sharing limited groundwater will encourage farmers to embrace water-sharing on a basin-wide basis.
A University of California at Davis study estimated that there were almost 7,000 fewer jobs for hired farm workers on crop farms, both year-round and seasonal. The state provided funds to farm worker service organizations to help farm workers, and they reported that the food and rent assistance vouchers they could provide were gone quickly. Agricultural areas of California have large numbers of poor residents, so there is a large pool of persons eligible for assistance.
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