Strawberry case study: what if farmers had to pay for water?
The strawberry, blackberry and raspberry fields of the Pajaro Valley stretch for 10 miles along California’s Monterey Bay coast, surrounded by fruit from April to early December. The valley’s 30,000 hectares of farmland are also dotted with emerald green lettuces, Brussels sprouts and kale varieties, bringing the region about $1 billion in revenue each year.
All that abundance doesn’t come cheap.
While American farmers elsewhere have watered their crops by pumping groundwater freely under their land, growers in Pajaro have to pay hefty sums for irrigation water — making it one of the most expensive places to grow food in the country, if not the world. The costs: up to $400 per acre, a standard measurement equal to one acre of water, one foot deep. The fees generate $12 million per year, which is used to recycle, restore and conserve the region’s groundwater.
The Pajaro Valley’s unusual system – essentially a tax on water – grew out of a berry farming disaster about 40 years ago, which forced farmers into action. As the country faces a widening crisis of dwindling groundwater, due to a combination of climate change, agricultural overpumping and other problems, some experts say the Pajaro Valley is an example of how this vital resource can be saved.
“What they’re doing is groundbreaking,” said Felicia Marcus, former chair of the California State Water Resources Control Board and now a fellow at Stanford University’s Water in the West program. While a few other regions have imposed taxes on agricultural groundwater, Pajaro Valley is one of the most aggressive and effective. “They are way ahead of the curve,” she says.
Experts from as far away as China and Egypt travel to the valley to study the system. But replicating it elsewhere could pose major challenges. For starters, “People don’t like taxes,” says Nicholas Brozovic, an agricultural economist at the University of Nebraska. “There’s nothing mysterious about that.”
New research the program showed a direct link between paying for groundwater and its conservation: a 20 percent increase in the price of groundwater has resulted in a 20 percent decrease in groundwater extraction.
One reason why experts see Pajaro as a model: despite the high water price, agriculture is flourishing in the region. It is the headquarters of major brands including Driscoll’s, the world’s largest berry supplier, and Martinelli’s, which grows most of the apples for its sparkling cider in the Pajaro Valley.
Driscoll CEO Soren Bjorn said in an interview that he “absolutely” sees the region as a model for water pricing that could be adopted in water-scarce regions from Texas to Portugal. “Water cannot be free anywhere because you cannot maintain a sustainable water supply without paying a price,” he said. “That would apply to the entire world.”
But if the Pajaro Valley experiment were to be repeated across the country, it could trigger changes across the economy that affect both farmers and consumers, resulting in higher supermarket prices while farmers would be forced to buy cheap staple crops that are necessary to be omitted. for animal feed and other purposes, such as textiles.
While corporate growers of premium produce like berries, which are shipped to the shelves of major chains like Whole Foods, Safeway and Trader Joe’s, can absorb the price of Pajaro’s water, there’s no way farmers of commodity crops like cotton, alfalfa and soybeans can do so. . make the economy work, said David Sanford, agriculture commissioner of Santa Cruz Province, which includes the Pajaro Valley.
In the years since water prices were imposed, growers of these crops have switched to expensive berries and lettuce, or simply left the region for cheaper pastures.
“There are big public policy arguments for pricing groundwater,” says Louis Preonas, an agricultural economist at the University of Maryland. “But if you tried something like this across the country, it would mean farmers would either move away from growing crops like corn, or leave farming altogether. No matter how you approach it, it will likely increase food prices. But the alternative is that the water runs out.”
A New York Times investigation this year found that many of the aquifers that supply 90 percent of the nation’s drinking water systems are becoming severely depleted due to a combination of climate change and overpumping by farmers, industrial users, cities and others.
For many agricultural regions of the country, the day when groundwater losses must be taken into account is fast approaching. In the Pajaro Valley it happened 40 years ago.
With its loamy sandy soil and cool nighttime breezes, the Monterey coast is an ideal climate for strawberries. But disaster struck in the 1980s. Growers pumped over coastal groundwater, allowing saltwater from the Pacific Ocean beneath their fields to seep through the roots of the berry crop.
“You could see the yellow leaves, the discoloration and the stunted growth,” recalls Dick Peixoto, whose family has farmed here since the 1920s.
Faced with economic disaster, Mr. Peixoto and other growers created a local water agency with two goals: protect groundwater and prevent the state from taking control.
The Pajaro Valley Water Management Agency, which remains locally managed today, got to work. The first project was installing meters to measure how much groundwater growers were using. In 1993, it began charging farmers a modest fee of $30 per acre-foot to cover the costs of managing and reading the meters.
The water agency hired hydrologists and other consultants, who concluded that the aquifer was seriously overloaded and could be completely lost to salt water. In response, the agency launched a $6 million project to capture and drain stormwater from a creek near the ocean and pump it into a storage basin, where it seeps into underground wells and eventually becomes used for irrigation.
Then came a $20 million water recycling plant, which cleans about five million gallons of sewage every day and sends it to the fields through a network of purple pipes. The purple indicates that the water inside is being recycled.
Now the agency is building an $80 million system to capture and store more rainwater for use in irrigation. Some of the cost of the agency’s projects is covered by federal grants and loans, while the rest comes from the groundwater pricing system, said Brian Lockwood, who has been general manager of the Pajaro Valley Water Management Agency for 18 years.
“These projects cost millions of dollars, and without this source of revenue they would never happen,” he said.
As the water agency’s ambitions increased, so did the price of water. By 2025, this is expected to reach $500 per acre-foot.
In the early years, farmers were annoyed by the tariff increases. “Pricing was very difficult, while the water used to be free,” says Thomas Broz, who has farmed about 30 hectares in Pajaro since 1996.
Ultimately, a group of growers took the water agency to court and succeeded in driving down prices for a few years, even forcing the agency to refund about $12 million to farmers between 2008 and 2011.
But then, from 2012 to 2017, California suffered the worst drought in history, drying out farmland and devastating the rural economy. Growers across the state, especially in the Central Valley, reached a deal with the state to sharply limit their water use and leave their fields fallow.
In the Pajaro Valley, water became more expensive, but at least it still flowed. To save money, many Pajaro farmers invested in precision irrigation technology to distribute carefully measured water exactly where it was needed. Gone are the days of sprinklers indiscriminately drenching fields.
In the midst of the drought, then-California Governor Jerry Brown signed a law requiring every part of the state to come up with a plan to conserve groundwater. Miles Reiter, then CEO of Driscoll’s, expressed support for the law.
Suddenly Pajaro was a model.
“Now we are seen as pioneers who led the way,” Mr Lockwood said. “We get calls from all over the country. How did you get this going? How do you get the growers to agree?” He partially recognizes local control over resources, saying, “This is better than the county or state taking control. And now this is something that is solid, it has been tried, it has survived lawsuits.
The last time the agency raised rates, in 2021, there was virtually no resistance from growers, said Amy Newell, chair of the Pajaro Valley Water Management Agency board of directors.
Mr Broz, who paid $20,000 for water last year, said he has now accepted the system.
“The farmer has very little flexibility to build in the cost of water, so it means we have to factor it into our product. It means we can’t be as competitive in principle,” says Mr Broz, who grows lettuce, berries and other types of cultivation. apples and other vegetables. “But the pricing has allowed us to take the kind of measures that will help us have a sustainable system for the long term if we want to preserve the resource.”
In the Westlands Water District in the central California valley, where many farmers fought the groundwater management law, the board will soon vote on a plan that would allow growers to pay for credits to use groundwater above a certain amount. They could buy and sell the credits, starting at about $200 per credit. A handful of other water districts in California are implementing similar measures.
Many farmers are concerned about the beginning of such a trend.
“The concern is that any kind of pricing system or market-based mechanism that attempts to manage or distribute this resource is likely to privilege a certain kind of producer – a multinational – at the expense of small-scale, independent farmers,” says Jordan Treakle. , program coordinator for the National Family Farm Coalition.
And in some parts of the country, groundwater pricing could mean an end to current harvests. For example, some experts said this could be the case for producers of Texas cotton, a staple crop that is almost entirely dependent on groundwater from the depleting Ogallala aquifer.
Mr. Bjorn of Driscoll’s said that Americans must be prepared to face that very outcome.
“We can’t get away with producing something for which the resources don’t exist,” he said. “We would be fooling ourselves if we continued to grow low-value crops in places in the desert.”
“Overcoming the hump of politics is the hardest part,” Mr. Bjorn said. “After that, it just manages the source.”