Abstract
Farmers use irrigation to mitigate drought risk and reduce yield uncertainty. A clear understanding of the monetary value of irrigation water and how it varies across time and space can help to inform farmers and policymakers about the potential impacts of water shortages and reduce uncertainty in decision making. Here, we introduce a framework for understanding the economic value of water used to produce corn in the central High Plains region during the period 2010–2017. Our analysis uses publicly available data for corn price and for irrigated and non-irrigated yields and incorporates irrigation requirement adjustments to account for the hydrologic balance. The findings suggest that the per unit value of irrigation water is highest not during severe droughts and not in more arid areas of the study region, but rather when and where irrigation can make the largest improvements to average crop productivity. Policy changes informed by these results might help to mitigate the impacts of future droughts on agriculture, especially in areas where climate change may lead to large increases in supplemental irrigation.
Highlights
Droughts exacerbate agricultural producers’ vulnerability and increase uncertainty in their decision making (Hayes et al 2004, Wallander et al 2017)
In the western U.S (e.g., California, Nebraska, Kansas, Texas), groundwater currently is a dominant source of irrigation water; nationwide, groundwater withdrawals for irrigation accounted for 48% of irrigation in 2015, which is 16% higher than in 2010 (Dieter et al 2018)
Our results show that in areas where rainfall is the main source of water for crops, irrigation can still provide significant economic value to agricultural producers
Summary
Droughts exacerbate agricultural producers’ vulnerability and increase uncertainty in their decision making (Hayes et al 2004, Wallander et al 2017). Among different mitigation strategies for drought impacts on agricultural production, like soil management (Schoengold et al 2015), crop switching (Lusk et al 2018, McFadden et al 2019), reservoir storage capacity expansion (Ward and Crawford 2016), or crop insurance (Annan and Schlenker 2015), the role of irrigation remains key (Troy et al 2015, Zhang et al 2015, Zipper et al 2016, Li and Troy 2018, Kuwayama et al 2018, Zhu et al 2019). Supplemental water protects crop cultivation by alleviating stresses imposed by climate variability and extreme variations in temperature and precipitation. Such variations are expected to intensify and occur more frequently in the future (IPCC 2019). The overall growth in water demand for irrigation has contributed to declines in water availability, raising concerns about sustainable water management across irrigators (Schaible and Aillery 2012) and other water users (Brown et al 2019)
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