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April 6, 2022

Shortages in Agricultural Water Sources: Increasing Your Land’s Drought Resilience 

In the U.S., particularly in the West, drought has been a reoccurring challenge for farmers and ranchers for many years. 

Since November 2021, almost 55 percent of the contiguous U.S. has been impacted by drought. While drought affects many states, it has played a particularly influential role in California’s history, with 37.2 million people impacted across the state.  

“Drought is also a personal crisis, market stand by market stand, for farmers who have been at it for decades, if not generations.”

As a result of increasing water shortages, water is becoming much more expensive. In turn, water is yet another input contributing to spiking production expenses for farmers. In addition to the financial implications of water shortages, crops and livestock are also threatened, forcing farmers and ranchers to adapt their growing methods in response to these constraints.  

To dive into this topic more, AgAmerica spoke with Senior Director of Partner Relations (formerly Senior Director, Institutional Business) and commodity expert Curt Covington on the impacts of water shortages in the U.S. and how farmers are responding. 

Listen to Curt’s insights on the current drought and the impact of rising interest rates below. 


Access to Water Sources 

There are two types of water sources that farmers draw from: groundwater and surface water. However, it’s important to note that not all farmers have access to both sources. Only those in dual-source water areas can access both types of water sources. According to Curt, having access to both sources is ideal by removing some of the barriers to sourcing water.  

When purchasing farmland, it’s beneficial to find land located in an irrigation district with access to both water sources. 

Which Water Sources Are Best? 

According to Curt, farmers occupying dual-source water areas select which source to draw from based on price and supply. Ultimately, whichever is the cheapest and easiest to access is the best source to tap into. According to the USDA, local irrigation and groundwater organizations often manage agricultural water use. As a result, water rules may also play a role in which source is the most accessible.  

In addition to price and supply constraints, water legislation plays a significant role in water accessibility for farmers and ranchers. 

Water Legislation  

Water legislation in the West poses immense challenges for American farmers and ranchers by limiting their access to water, an essential component of growing food. One of the most notable water laws is California’s Sustainable Groundwater Management Act (SGMA). The implementation of this law occurs at the local level with various Groundwater Sustainability Agencies (GSAs). These organizations decide what the sustainable level of groundwater is in their area and implement legislation to maintain this level.  

This legislation aims to maintain groundwater at sustainable levels and prevent overpumping. In turn, both groundwater pumping and land and water usage are impacted by SGMA. To ensure groundwater levels are sustainable, SGMA utilizes six different sustainability indicators:  

  • Groundwater-level declines  
  • Land subsidence  
  • Seawater intrusion  
  • Groundwater-storage reductions  
  • Interconnected surface-water depletions  
  • Water-quality degradation  

Overall, while the intentions are good, this legislation presents obstacles for California farmers and ranchers that make acquiring water even more difficult. Going forward, it will be important for legislators and members of the agricultural community to work together to find solutions that consider the needs of American farmers and ranchers. And Curt argues that enhancing water storage capacity should take a central role in legislation.  

Strengthening Water Infrastructure  

As water demand grows in the West, the water storage capacity hasn’t kept up. Curt believes that enhancing water infrastructure to store more water is the most effective solution to these water shortages. During wet seasons, not enough water is stored. As a result, there are immense shortages during seasons of drought. For instance, in California groundwater comprises 30 percent of the water supply during non-drought years but 60 percent during drought. According to the Public Policy Institute of California Water Policy Center senior staff member Jeff Mount, not enough groundwater is reserved for droughts because too much is used during wetter periods.   

While more funds are needed for water-storing infrastructure, the recently passed Infrastructure Investment and Jobs Act dedicates $1.15 billion for improvements to California’s water storage. According to Curt, farmers need a commitment from both the federal and state governments to strengthen the infrastructure that stores water.   

In addition to supporting legislation that strengthens water infrastructure, farmers and ranchers are also adapting their production practices to increase the drought resilience of their land.  

Adapting Cultivation Techniques to Combat Water Shortages  

While water shortages are likely to persist, Curt shared three techniques Western farmers and ranchers are implementing to use less water and optimize their production efficiency.   

1. Transition to Less Water-Intensive Crops  

Transitioning to crops that require less water is one way to reduce the water needed for a healthy crop. Some farmers who used to grow water-intensive crops such as alfalfa and rice are transitioning to crops that require less water and can use drip irrigation systems. While there are upfront costs of making this transition, it is an effective way of minimizing water use in the long-term.   

However, it is important to note that if access to water continues to be strained, the availability of water-intensive crops such as rice and cotton may also be strained, potentially causing prices to increase.  

2. Divert Water from Fallowed Portions of Land  

Another way farmers are responding to water shortages is by discontinuing production on portions of their land and diverting water to a less water-intensive crop. For instance, a farmer may stop the production of almonds on one section of their land and use the remaining water for their pistachio crop instead. In some areas, farmers are even paid to leave portions of their land fallow with the goal of saving more water. For instance, in 2020, some farmers were paid to refrain from growing water-intensive crops like alfalfa and instead grow lettuce, broccoli, and cauliflower. 

3. Implement Conservation Practices  

Introducing regenerative agriculture practices is an effective way to increase the drought resilience of your crops. According to the USDA, some beneficial conservation techniques include:  

These techniques increase the soil’s ability to absorb and retain water by increasing soil health. Soil health practices increase organic matter in the soil, leading to less water loss via evaporation and transpiration. For every one percent increase in organic matter, water stored in the soil can increase by up to 25,000 gallons per acre.   

In addition to improving soil health, it’s also important to optimize your irrigation strategy. Implementing drip irrigation instead of traditional spray irrigation is a more efficient way of irrigating crops. For instance, in California, micro sprinklers and drip irrigation systems have reduced water use by 33 percent per round of almonds compared to twenty years ago. Drip irrigation systems save water by using a more precise application method than traditional spray irrigation systems. By being applied directly to roots and stems, less water is lost to evaporation.  

While water shortages are outside of your control, you can take action by adapting your operation accordingly and supporting effective legislation.  

Make Your Land More Drought Resilient  

We understand that making your land more drought resilient requires sufficient capital—and we’re here to support you.  Some of the ways you can make your operation more drought resilient include:  

  • Purchasing land with dual-source water access;  
  • Crop redevelopment;  
  • Irrigation technology; and  
  • Conservation practices.  

Equip yourself with the tools to navigate water shortages with AgAmerica’s flexible financing spectrum.   

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