Executive Summary for February 1st

Falling prices for almonds are causing some to rethink whether converting row crops to almond orchards in the Central Valley is the best use of water resources. Plus, the state begins a public comment period on draft regulations that will help set the criteria for new water storage projects.

Published on Feb. 1, 2016 Read time Approx. 3 minutes

Falling Almond Prices Could Impact Water

Falling prices for almonds are starting to cause a stir in California. The state grows most of the country’s almonds and a significant portion of the world’s almonds, and in recent years it has become quite a cash crop.

As demand for almonds increased, and prices rose, many row crops in California were abandoned in favor of planting almond trees. The number of acres of almonds in 2005 was 590,000 and last year it climbed to 890,000.

This agricultural shift came under scrutiny as years of drought stretched on in California.

“The fact that almond orchards cannot be fallowed in a drought – unlike, say, tomatoes or cotton fields – just puts more pressure on state and federal agencies to keep pumping water through the Delta to keep valley orchards irrigated,” reported the Sacramento Bee.

And as surface water deliveries were cut, farmers were forced to rely on groundwater to keep their orchards alive. But overpumping of aquifers has become a serious problem in the Central Valley, contributing to subsidence in some places and causing concern that that California’s “savings account” of groundwater is running out.

For farmers, almonds have been a good investment, but that may be changing. Prices in 2008 were $1.45 a pound; that climbed as high as $4.50 last summer, with some varieties going even higher. But now prices have fallen to $3 a pound or lower, causing some to question whether it’s good economic and ecological sense to continue to convert farmland in the Central Valley to thirsty almonds.

Many farmers anticipated the “price correction” and understand their business is one of natural ups and downs. But the economic implications could ripple. The Sacramento Bee reports that the decline in prices could make some farmers rethink their willingness to help finance Gov. Jerry Brown’s $15 billion plan to build tunnels to direct water through the Delta to the Central Valley.

“Farmers have been questioning whether the tunnels would pencil out for them financially, and a sustained drop in nut prices could make the project an even tougher sell, said Ted Page, an almond grower and chairman of the Kern County Water Agency,” the Sacramento Bee reports.

Billions to Be Spent for New Water Storage Projects

California is moving one step closer to figuring out how to divvy up billions of dollars for water improvement projects. During the November 2014 election, California voters passed Proposition 1, a $7.5 billion bond for improving the state’s water systems. A dedicated portion of that money, $2.7 billion, is to fund surface and groundwater storage projects.

The California Water Commission is tasked with determining the “quantification and management of the public benefits of water storage projects,” which involves understanding how water storage projects will benefit the public and what criteria to use in evaluating which projects will receive funding through its Water Storage Investment Program. To kick off that process, the commission has released draft regulations and is seeking public comment.

The commission sees five public benefits to water storage projects it is willing to consider:

  1. ecosystem improvements
  2. water quality improvements in the Delta or other river systems
  3. flood control benefits
  4. emergency response
  5. recreational purposes.

One of the key considerations is also how these projects, which will have lifespans of many decades, plan for resiliency to both future sea level changes and climate change.

Juliet Christian-Smith, a climate scientist at the Union of Concerned Scientists, said that all projects being considered should include the “best available climate science,” but she doesn’t think the draft regulations meet that requirement.

“In fact, the regulations state that climate change impacts will not even be considered after 2050, which models indicate is about the time that those impacts could become much more severe,” she wrote. “These regulations are now open for public comment and it’s important for experts, concerned citizens and taxpayers alike to ensure that public money is spent wisely – and that the infrastructure that we build today will be able to deliver tomorrow.”

Public comments on the regulations are accepted until 5 p.m. on March 14. Written and oral comment will also be accepted at a public hearing in Sacramento on March 16.

Top Image: Jim Jasper, owner of Stewart Jasper Orchards, displays a box of almonds ready for shipping at his processing plant in Newman, California, in July 2015. Courtesy of Rich Pedroncelli, Associated Press

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