Economics of the Drought for the Sacramento Valley

By Tim Johnson

With harvest over and crop reports now in, we can get a better sense of the drought’s impact on farms. By any measure, it was one of the most severe droughts in memory.

Rice declined by 131,000 acres, or 23 percent, from the previous year. While per acre yields were up, the net decrease in rice production was one billion pounds.

Highly dependent on winter rains for irrigation, wheat acres decreased by almost 190,000 acres across the state. Of greater impact, much of the wheat was harvested for feed before it matured, resulting in almost a 50 percent reduction in grain production for the year.

Oat acreage was down by a third. Sunflowers, another iconic crop in the Sacramento Valley, were off nearly 20 percent.

In total, current USDA estimates show over half a million acres of grain, feed and cotton crops were left out of production in the state last year.

An analysis by UC Davis puts agricultural loss statewide at $2.2 billion, impacting 17,000 jobs based on estimates in mid summer. Updated assessments will no doubt put the numbers higher.

Unfortunately, farms are not the only things impacted by the drought in our valley.

Prior to the December storm, things were looking tough for waterfowl in the Central Valley. With planted rice acreage down because of the drought, winter-flooded rice was expected to decline from 300,000 acres to less than 100,000. Wetlands were also expected to decrease by about 25 percent because of water shortages.

The big December rain flooded many of the harvested rice fields that had been dry, and provided many public and private wetlands with badly needed water. Although this has greatly improved things, California just saw its driest January in over 200 years. Unless we get some precipitation between here and the end of March, ducks along with farms could be facing another drought next year.

Impacts of the drought are not felt equally across the state. By the nature of agriculture and location of our wetlands and wildlands, the drought is felt more heavily in our rural communities. In many of our Sacramento Valley communities, agriculture accounts for 30 percent or more of the jobs. The tax base in these same communities is dominated by agriculture-related businesses.

Our rural areas are also where the majority of wildlife lives – on our state and federal refuges and even more so on our farms. No water on the landscape and fewer acres planted to grains means far less wildlife.

While our urban neighbors face dry lawns, dirty cars and higher food prices, drought in rural California looks like fallowed acres, unemployment and skies empty of migrating waterfowl.

Here is a link to a recent Huffington Post article on the drought.

Tim Johnson, CRC President & CEO