urban water institute annual water policy conference ken melban director of issues management...
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Urban Water InstituteAnnual Water Policy Conference
Ken Melban Director of Issues ManagementCalifornia Avocado Commission
Hilton Mission Bay ResortAugust 24, 2012
California Avocado Commission
Role• California Avocado Commission is a non-profit, public agency that provides marketing and promotional support for the industry's 5,000+ growers• The Commission also provides advocacy and support on issues involving labor, water, production, trade, pest protection, environmental stewardship, and food safety
Mission • To maximize grower returns by maintaining premium brand positioning for California Avocados and improving grower sustainability
Commission Structure• 29 member Board of Directors
20 growers, 8 packers, 1 public member
• 13 member staff
• Headquarters located in Irvine, CA
• Includes a Southern California Agricultural Water Team to assist farmers in addressing issues impacting the cost, availability and regulation of agricultural water
History of Ag in Southern California
• Agriculture has been part of the southern California’s identity since the beginning
• Objective of Ag water sales - shed demand before urban rationing while generating additional revenue
• Ag imported water supply programs w/MWD since 1958
Southern California Ag Today
• Agriculture and related businesses contribute $40B to southern California economy
• San Diego, Riverside, & Ventura counties ranked among top 10 Ag counties in CA*
• Average value of farm products sold per acre in southern California exceeds almost all other regions nationwide
• Ag generates about 450K jobs
* Based on the market value of Ag products sold
Top Ag Commodities in Southern Cal.
Southern California avocados are a $373 million a year crop (2010)
0 100 200 300 400 500 600 700 800 900 1,000
Strawberries
Woody ornamentals
Lettuce
Milk
Avocados
Cattle
Lemons
Foliage plants
Bedding plants
Celery
Cut flowers
Broccoli
Million Dollars ($1,000,000)
Profile of California Avocado Industry
• Season: March – September
• Planted acres by variety: 59,341 Hass-like 1,835 Non-Hass
• Average grove size: 10-20 acres• A mature orchard of approximately 110 trees
per acre, can produce as much as 22,000 pounds per acre per year
• Modern orchard may have more than double the number of trees per acre, but absolute irrigation needs remain essentially the same, approximately four acre-feet per acre per year, regardless of tree planting density.
California Avocado Production Areas
• 95% of growers are located within 20 miles of the southern California coast and are responsible for more than 90% of all domestic avocado production
•Approximately 70% of California avocado production within the MWD service area
U.S. Market OverviewPer Capita Consumption
•In the U.S. fresh fruit market, domestic per capita consumption of avocados increased an average 10 percent annually from 1999-2009, the second-fastest growth rate after blueberries*
•Total consumption has also increased substantially. In 1980 total consumption was 479 million pounds. In 2009, that increased to 1.27 billion pounds.•As of 1980, total per capita consumption was 2.08 pounds. In 2009, that increased to 4.10 pounds per capita*
* USDA Economic Research Service
U.S. Market OverviewTotal Aggregate Supply
* 2011 Data not yet final
Volu
me (
Mil
lion
Pou
nd
s)
Challenges/Opportunities• Water Pricing and Quality
• Food Safety • Labor Availability and Cost
• Industry Modernization – High density plantings– Managed tree height– Salt-tolerant varieties
• Environmental Benefits– Cap and Trade/Carbon Credits
Breakdown of Avocado Production Costs
• Affordable/Reliable/Quality Water is Critical to a Healthy Ag Economy
Comparison of Ag Water Rates
• Agriculture Is Faced With Crushing Rate Increases
- 222% in 20 years
Agency $/Acre-foot
MWD IAWP UNTREATED (2012) $537
MWD TIER 1 UNTREATED (2013) $593
Valley Center Ag Rate $1,170
Coachella Valley Water District $29
El Dorado Irrigation District $43
Imperial Irrigation District $20
Semitropic Water Storage District
$80
Case Study - Valley Center Water District
• Drop in overall water sales of 42%
• Ag water sales have dropped by 45%
• Productive avocado acreage dropped by 25 percent between 2005 - 2009
• 667 square acres of dead or dying avocado trees in abandoned groves were declared a fire hazard
• 21% drop in Ag water meters
• Layoffs for 12% of staff
Water Quality Challenges • Water Quality degradation of imported
supplies is damaging production• Sufficient SWP supplies are crucial to
meeting MWD blend target
Alternative Supply Cost Comparison
• Eyes wide open
Final Thoughts
• Great deal of interest in a Delta fix
• Number of issues to work through
• Final capacity could have significant cost and reliability impacts
• Delta Fix has great potential to address Ag’s long-term needs
• Ag affordability needs to be considered
Future of Ag• Ag Water Survey
Question:“Should regional water
agencies continue to allow farms and other agricultural producers to purchase surplus water at a lower rate, with the understanding that agricultural users participating in this program will be the first to reduce their water usage in shortage conditions?”
19% Oppose, Probably Oppose
Thank-you