Tree nut growers are 23% more likely than other farmers to take advantage of drought assistance, even if it costs them more money in the short term, according to a university study.
Growers of nuts – particularly almonds – place a higher dollar value on USDA monetary and technical aid and are willing to take an over $7,000 loss in a season or two to protect their long-term investments, according to research from California State University, Fresno.
Whereas a row crop grower can limit planting in years when he or she can’t get much water, a tree farmer must still keep the trees alive and productive, noted Todd Lone, a professor in Fresno State’s Department of Agricultural Business.
“It’s a high-value crop,” Lone said during a seminar at World Ag Expo on Feb. 12. “In this situation when it’s multiple years, they can’t afford to have drought cut into their bottom line.”
According to a Fresno State survey, growers are willing to spend an average of $21,815 to meet program requirements and would expect an average of $14,185 back. A program offering some technical assistance would be worth as much as $15,834 to tree nut growers, and a program offering a lot of technical help would be worth an additional $10,526, according to the survey.
The study comes as the San Joaquin Valley is still feeling the fallout from the historic drought in 2012-16 that forced steep surface water cutbacks that caused an overreliance on wells. Tulare County has approved 3,684 drilling permits for wells since 2014, Lone said.
As a persistent overdraft of groundwater tables led to a widespread subsidence problem, state lawmakers passed new restrictions on pumping in heavily impacted areas.
The almond industry accounts for 10% of the state’s annual agricultural water use, as the Central Valley produces 80% of the world’s almonds, Lone noted. While almonds require more water than many other commodities, the nutritional value of almonds along with the industry’s push toward water efficiency should help their eligibility for programs that put an emphasis on such things, Lone said.
The USDA offers a variety of assistance programs, including emergency loans when there’s a formal disaster declaration, Lone said. Moreover, the Western Water and American Food Security Act of 2015, which reduced federal regulations over water policy while providing more flexibility for federal drought responses, is focused on maximizing water deliveries, he said.
Fresno State’s research used conjoint-analysis and a contingent valuation method to estimate farmers’ willingness to pay for various attributes of drought assistance programs, Lone said.
He, researcher Pei Xu and other scientists in the university’s Jordan College of Agricultural Sciences and Technology analyzed the perceived benefits and costs of financial and technological assistance for tree nut, fruit and other food growers in the Central Valley. The project also examined the economic impact of drought assistance programs.
“Obviously water is a very scarce resource,” Lone said. “Depending on what segment you’re in, you might need more water than other commodities.”
The results are based on a questionnaire with responses from 63 growers, he said.
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