16 February 2009

Water Chats -- IID and Joe Tagg

Last Wednesday, I had a water chat with Joe Tagg, a farmer (and much else) who works about 3,000 acres in the Imperial Valley. Joe is a salt-of-the-earth kinda guy who says what's on his mind, and he says quite a lot. Here are some highlights of our 1 hour and 22 minute chat [29MB MP3]:
  • Water is too expensive at IID. $17/AF is way more than $6-12/AF that farmers pay elsewhere.
  • Farming is tough. There are bureaucrats everywhere with their hands out for fees and forms.
  • We want to FARM the land. Stay out of our way, and let us control our water.
  • Products are exported to many places domestically and internationally. The economic slowdown is brutal [demand for milk down?!]
  • The Imperial Irrigation District does NOT control own the water. It belongs to the farmers.
  • IID farmers grow alfalfa because water is cheap and labor is expensive.
  • The IID doesn't care about its farmers. If the farmers fight, the IID will "fight you with your own money." [Why? Because IID is controlled by popular vote, not a vote of landowners -- as is the norm in other irrigation districts.]
That's just in the first half-hour, so now you have a reason to listen to the rest.

Tomorrow I will post the interview with IID staffers and an analysis of the institutionalized dysfunction of IID. This is going to be good. Promise.

Tagg's Bottom Line: Let us (farmers) control our water.

7 comments:

  1. He is wrong. The water is too cheap. The Colorado River has better uses than over irrigate alfalfa.

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  2. A bit more information would be helpful... How many acres are irrigated, how many tons per acre of alfalfa is harvested and what is today's price per ton for the alfalfa ? What is the normal application rate in acre feet of water / acre ( AF/A)? Is the crop under a sprinkler or flood irrigated or both and if so what are the approximate percentages of land irrigated by each application method ? What is the net profit after paying all expenses for fertilizer, water, machinery, labor and shrinkage in storage ?

    If he knows it, what is the consumptive use factor for alfalfa in his area and how many cuttings is it based upon? Does he have the same number of cuttings ? This may be obtainable from Water Resources or the local extension service.

    Who are the main buyers of the alfalfa ? ie dairies, feedlots or race tracks?

    If the crop is flood irrigated and if there is run-off, how far away is the next water use for the same water and what is the use ?

    If the crop is sprinkler irrigated, does he get any credit or re-use for the recharge?

    Hard to make any evaluations without much this information.

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  3. Those guys aren't idiots. They grow alfalfa because it is profitable to do so. With their yields and today's prices and costs, it would probably take a water cost in excess of $50 a/f, or more, to make alfalfa uneconomic. With the weather and soil conditions down there, they do not have a huge choice of crops to grow. And remember, alfalfa can be idled for part of the growing season, allowing considerable water savings and flexibility in deliveries.
    However, the more important point to remember is that if the water could be sold under an all-in auction, Dutch auction, or other sane mechanism, the farmers may well have access to a revenue stream far more lucrative and less risky than growing crops, at least on some of their land. The one-grower, one-vote nonsense (instead of one-acre one-vote) is a relic of the socialist schemes of the 1930's, and has caused untold mischief across the country, not just in water districts but in the thousands of farmer owned (and government subsidized) cooperatives. It frequently allows the loudest knucklehead, not the person with the most economic interest in the enterprise, to call the shots.
    Random answers to some of J's comments and WaterSource's questions: a) it is irrational to over irrigate any crop, but over irrigating alfalfa kills the plant, which is the loss of a 5 year investment. It happens, but it is not practiced. b) As long as a field is properly leveled, with most soils flood irrigation is just as efficient, or more efficient than sprinkling, (which inter alia requires electricity). c) In Imperial, yields of 10-12 tons of alfalfa are not uncommon, which are probably the highest on Earth. it takes about .75 acre feet per cutting, and they get 7-9 cuttings. The extremely high summer temperatures make evaporative losses high and hay quality low. It is in those months that a field idling/water sales program is a slam dunk proposition.

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  4. David,

    I would find it very helpful if you could post the source material for the sound bite that alfalfa is a low value crop. I have heard that "factoid" quoted quite a bit over the years, but I've never seen the numbers that back it up. I'm also curious as to what the criteria is for low value crop, medium value crop and high value crop.

    Is there any consideration of production risk, market risk or any other type of risk?

    Is the value determination based on rate of return, gross revenue per acre, net profit per acre, something else?

    People always talk about alfalfa being low value, but I haven't ever seen any rationale for this.


    Alfalfa has some very nice characteristics from a grower point of view: there are 7 -9 harvest opportunities, so if one cutting is damaged, the entire year's income damage is minimized. Labor requirements are minimal...recall in California, the minimum wage is $8/hour, in other states, the minimum wage is $5.15. Also, alfalfa is fairly forgiving if water applications are delayed, not all crops are like that.

    From my perspective, having alfalfa as part of the crop mix is like having a bond or even a T-bill in one's investment portfolio. Those investments are good to have in one's 401k. You don't want the entire portfolio to be low risk investments, but it is good to have some.

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  5. That "low value" canrd has been around since Marc Reisner first published Cadillac Desert. He came to his senses in later years. For those who can grow it properly, alfalfa is a very high value crop; as well as an essential component of our very large dairy industry. It also has many environmental benefits, since it requires no nitrogen, serves as habitat for many birds, reduces particulates in runoff, produces far less dust than cultivated crops, and harbors large quantities of beneficial insects. But of course try telling that to some a priori expert who knows "all about" farming because they read an article somewhere.

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  6. @Anon -- Low value as in $price/AF of water applied. As you and Philip point out, that's NOT a very good metric if other aspects (labor, risk) matter.

    For the record, I don't care *what* a farmer grows as long as he's buying his water at "market" prices. Since that's not the case, there's some room to critique crop choice, but not before critiquing the lack of markets! (Put differently, alfalfa is the farmer's choice given a constrained optimization.)

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  7. He was off too on his assumption that the falling water generates the power--as the next one says, only 6% comes from water, the rest from regular stuff.

    The fixed cost argument is interesting -- that the district is made to deliver all this water but if you take some away, you spread the fixed costs around a smaller contingent. I have heard this all the time, and it seems a temporary renting would get around this no problem -- so I don't see why he is still so opposed.

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