What California’s Drought Means for Agriculture

California is now in the middle of a drought emergency according to Gov. Jerry Brown. 2013 was the driest calendar year in California since it began being tracked in 1849, and there has been little to no rain throughout the state thus far in 2014. Snowpacks in the Sierra’s are down to about one-sixth of their normal level. This leaves Californians, farmers and urbanites alike, wondering what this year may hold if the rain doesn’t start coming soon.

Having less water available means that many farmers will be forced to leave fields or orchards fallow for the year. As water prices inevitably rise later in the year, farms that have enough water available may opt to capitalize on the high demand and sell the water while leaving their land fallow. This reduction in available water is exacerbated by the fact that farmers in recent years have replaced annual crops (such as lettuce and tomatoes) with permanent tree crops that need to be watered year-round.

The level of uncertainty about the length of this drought will likely prompt administrators to limit the amount of water made available to farmers. No matter how farmers plan on compensating for this, less water means that less food will be grown locally, meaning more food will be imported and food prices will be higher. We can all do our part by trying to save water wherever possible, whether it’s taking shorter showers or not washing our cars, but maybe our best course of action at this point is to just pray for rain.

About the Author 
Tim Peters is a consultant with Morrison, working primarily in our Business & Accounting Advisory practice. To get in touch with Tim, please find contact information for Morrison here.


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