What is the value of irrigation?

What is the value of irrigation?

Jan 17th 2022

Since the mid-twentieth century, agricultural production in the Great Plains region of the United States has increased rapidly due to increases in irrigation, with most of the water being drawn from the High Plains Aquifer. The Aquifer includes southern South Dakota, southeast Wyoming, eastern Colorado, Nebraska, western Kansas, eastern New Mexico, northwest Oklahoma, and northwest Texas.

This region is highly dependent on irrigation in order for crop production to be successful. Given that irrigation has resulted in varying levels of High Plains Aquifer, it is important to identify the value of this resource in crop production.

Recently research that was published in the American Journal of Agricultural Economics. Found the agricultural production from irrigation across the High Plains Aquifer was worth about $3.5 billion in 2007, $2 billion of which was produced in Nebraska.

The research investigated crop production and weather information from 1960 to 2007 for 205 counties. The key factor was the ratio of yields on irrigated land compared to non-irrigated land.

They observed yields at the county level where they were multiplied by the IR elasticity estimate for the county to estimate the extra production due to irrigation. Next, that yield increment was multiplied by the average price for biomass in the county.

At an average price of $103.50 per ton, this indicates the average acre irrigated across Nebraska realized $264 per acre of additional production or about $2 billion when accounting for the 7.6 million acres irrigated.

The study also provided an evaluation of the damage caused by extreme temperatures. The number of hours over the growing season that the crop was exposed to this high temperature was calculated. The result was divided by 24 to convert it to degree-days.

Results showed that each degree-day for the crop reduced yields by 3%. The average number of degree-days across the entire region and period was 2.7. This made the indication that high temperatures decreased crop yields by about 8%.

The researchers found that irrigation increased biomass yield by an aquifer-wide average of 51%. The average gross value of this increment in biomass was estimated at $125 per acre per year. The county values were ranging from $26 to $282 per acre. By 2007, the average yield had advanced to 60%, and the average gross value to $196 per acre.

It is important to note that the impact of irrigation on yields decreases as the portion of land irrigated within a county increases. Therefore, one might expect that additional irrigation across the region would result in smaller yield increments than the average that was given for 2007.

So which part of the region is using the most water?

Nebraska covers 36% of the aquifer and 69% of the total water volume. Water pumped for irrigation in Nebraska contributed about $2 billion worth of agricultural biomass in 2007.

Over the past 10 years, that water level has been rather stable this studies the main objective was to determine the economic importance of monitoring the aquifer and efforts by various agencies to manage the water usages.