The weakest section of the Pacific Institute report is the section on crop shifting. They wrote that shifting from low value field crops* that use more water to higher value row crops** that use less water could save 0.6 million acre-feet of water. I wish they hadn’t published that without much more data. Here’s why:
The issue that bothered economists didn’t bother me:
1. The Pacific Institute explicitly states that they base their model off gross values for the crops they put in their model. They admit that the net amounts may differ, because crops that fetch a lot of money at market may also require expensive inputs. That is something of a crucial point for growers. The economists get all hot and bothered and assert that if the net amounts for row crops were higher now, growers would have shifted already. I don’t think that is self-evident. I don’t believe that growers behave like the rational economic model. I think some are traditionalists, some may choose a crop out of familiarity, or because they accept lower profit for lower risk, or because they don’t know about all markets for all crops or because of local custom. So I think two things. The Pacific Institute model would be vastly better for using net values and it may be true that growers could make more money shifting from field crops to row crops.
Something else bothered me:
Unfortunately, the Pacific Institute didn’t show their model output telling us how many acres of what field crops would change to row crops. Without knowing each field crop and row crop, it is impossible to evaluate that section. For example, did they say that a few thousand acres of rice would change to peaches? Because that won’t work. Rice is grown up in big clay ponds up in the north Sac Valley. You can’t grow other things on that soil. You could get rid of a few thousand acres of rice, but you aren’t shifting to anything. Are they shifting out of alfalfa into broccoli? Alfalfa has had some extremely good years recently with all the new dairies in Kern County and broccoli processors are shutting their doors. Basically, anyone who keeps current with ag wants to know exactly what acres would change to what, and they didn’t tell us. No one current in ag believes a blanket assertion that whole sectors of ag are worth more than other sectors. There are far too many counterexamples and I don’t know if their model included those.
The irrigation professors critiqued this section by saying that they don’t observe year-to-year expansion in the row crop market, from which they conclude that growers are currently providing about all the vegetables the market wants. Switching to row crops might save water, but this isn’t a strategy based on responding to an extrinsic demand for row crops. (pg 9)
These complaints make it hard to take the crop-shifting section of the Pacific Institute report seriously. I would love to see a version of this section using net values for crops and showing exactly which acreage would change. But even with that information, I have a different, abstract objection to the whole concept of switching to higher value crops.
* Pasture and grains, mostly.
**Row crops are also called truck crops and are basically vegetables.