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Food Inflation Watch: California Farmers' Water Costs Surge 700% After Government Cuts Supply

Tyler Durden's picture




 

When we reported on the government's decisiosn to withhold irrigation water to California for the first time in 54 years, we warned there would be consequences: farmers are hit hardest as "they're all on pins and needles trying to figure out how they're going to get through this." Fields will go unplanted (supply lower mean food prices higher), or farmers will pay top dollar for water that's on the market (and those costs can only be passed on via higher food prices). Sure enough, as Bloomberg reports, farmers in California’s Central Valley, the world’s most productive agricultural region, are paying as much as 10 times more for water than they did before the state’s record drought cut supply.

 

As Bloomberg Briefs' Alison Vekshin reports,

Costs soared to $1,100 per acre-foot from $140 a year ago in the Fresno-based Westlands Water District, which represents 700 farms, said Gayle Holman, a spokeswoman. North of Sacramento, the Western Canal Water District is selling it for double the usual price: $500 per acre-foot, about 326,000 gallons.

 

The most severe water shortages are in the San Joaquin Valley, in an area from Bakersfield to Patterson and Chowchilla, said Mike Wade, executive director of the California Farm Water Coalition, a Sacramento-based group representing farmers and most agricultural irrigation districts in California.


The drought gripping the state that supplies half the fruits, vegetables and nuts consumed in the U.S. has led federal and state providers to curtail the water they distribute to farmers. That’s prompted districts representing growers to buy and sell for escalated prices from other parts of the state.

 

The drought threatens to boost produce costs that are already elevated following a December frost, according to the U.S. Agriculture Department. The price of fresh fruit is forecast to rise as much as 6 percent this year, the department said last month.

 

Dairy products, of which California is the biggest producer, may rise as much as 4 percent. After three years of record-low rainfall, 82 percent of the state is experiencing extreme drought, according to the U.S. Drought Monitor, a federal website.

 

The rising prices are “a function of supply and demand in a very dry year and the fact that there are a lot of competing uses for water in California,’’ said Mat Maucieri, a spokesman for the Bureau of Reclamation.

*  *  *

Seems like it's time for The Fed to print some more rain...

 

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Thu, 07/24/2014 - 20:55 | 5001710 world_debt_slave
world_debt_slave's picture

not much water used in Soylent Green

Thu, 07/24/2014 - 20:58 | 5001724 Publicus
Publicus's picture

Checkmate.

Thu, 07/24/2014 - 21:06 | 5001737 knukles
knukles's picture

Quit floating the water through the aqueduct system to Los Angeles and points south for car washes and wet tee shirt contests, FFS.
Yes, there's a water shortage but State and Federal meddling and fucking about for political purposes are making this 1,000's of times worse than it already is.  And further problems cause by further meddling will be met with further political solutions and further crop shortages.

Believe me, folks, I know as I've family members in the Ag biz ....
Up close and personal

Those people down south have the resources, same as anybody else, to build large scale desal operations to take care of their "needs"
Not all their "wants", but their "needs".

I mean fuck me... just when we're gonna have more than enough New Labor to pick the crops, there will be no crops to pick

Only the government....

Thu, 07/24/2014 - 21:08 | 5001747 world_debt_slave
world_debt_slave's picture

another reason that Northren California wants to break off from Southern California.

Thu, 07/24/2014 - 21:12 | 5001761 knukles
knukles's picture

Yep

Thu, 07/24/2014 - 21:20 | 5001788 90's Child
90's Child's picture

California's grow some good weed though.

Tahoe OG kush is a gnarly strand.

Save the weed people.

Thu, 07/24/2014 - 21:26 | 5001810 knukles
knukles's picture

Recent serious stories in many CA news papers and local telly about how the pot farms are contributing to the water shortage.... just like electric cars to the road tax revenues.

Aaaaarrrrtagghhhh!

Thu, 07/24/2014 - 22:04 | 5001855 DaveyJones
DaveyJones's picture

lawns in arid places are next to the stupidest thing we've ever done. Next may be "modern agriculture." Before corporate giants took it over, food was actually (and wisely) spread out all over this country not slammed into one arid state with an artifical water system designed to fail. Small farmers had millions of tiny catch ponds that captured and held rain water when it fell and used it in dry times when it didn't. Land and nature were never meant to grow one plant for hundreds of acres. The simple idea is insane, expensive, toxic and destined to fail. Add Monsanto and you've created suicide.       

Thu, 07/24/2014 - 22:38 | 5002054 markmotive
markmotive's picture

Conserve water or perish.

So says the United Nations.

http://www.planbeconomics.com/2013/10/conserve-water-or-perish-warns-un-...

Thu, 07/24/2014 - 23:47 | 5002202 El Vaquero
El Vaquero's picture

Not as fucking dumb as Albuquerque and Rio Rancho have been for the past couple of decades.  Conserve water so we can grow so that we can conserve even more water.  

Thu, 07/24/2014 - 23:57 | 5002221 Keyser
Keyser's picture

Last one out turn off the lights... Electicity is expensive as hell in Ca... 

 

Fri, 07/25/2014 - 00:06 | 5002242 TBT or not TBT
TBT or not TBT's picture

Let's build some fuckin' dams, on the one hand, and price the water a little closer to a causal relationship  between cost and price, on the other hand.   California hippies like the current governor Moonbeam halted the well planned CWP back when California had half the population it does now.   If we had those reservoirs, we'd have more water to bridge this drought.   

Fri, 07/25/2014 - 02:00 | 5002404 pakled
pakled's picture

You mean like.. 'Cadillac Deserted'?

Thu, 07/24/2014 - 23:43 | 5002195 El Vaquero
El Vaquero's picture

"Land and nature were never meant to grow one plant for hundreds of acres."

 

Yup.  I tried Three Sisters planting this year, and while I fucked up the timing a bit (I'll still be able to recover,) I've had hardly any squash bugs on the squash.  They get to the corn, find more corn, get confused and leave to my summer squash or my neighbor's squash.  

Fri, 07/25/2014 - 05:01 | 5002491 zhandax
zhandax's picture

I got bit by a squash bug last night while watering.  It was probably a good thing, as I wouldn't have otherwise known there were any around until the cucumber plants went missing.  Hurt like hell, though.  May have been aggravated by my cauterizing it with my cigarette.

Fri, 07/25/2014 - 05:53 | 5002624 Adahy
Adahy's picture

We've been really lucky on the squash bug front down here for once.  Thank goodness.
What's killing me this year is that damn cucumber bore 'worm'.  My dreams of a pantry full of homemade pickles are quickly fading.
Anyone know what to plant nearby to deter those bastards?

Fri, 07/25/2014 - 08:02 | 5002807 KHarper
KHarper's picture

I've had great sucess with the following method; find the spot where the worm is (look for excretment trails, and they are usually just above that area), stick a long straight pin it a few spots in that area (you are trying to penetrate the worm, thereby killing it). Check it the next day, if no excrement trails, you have killed the worm. If you did not kill the worm, it's time to perform surgery. Take a sharp knife and make an incision in the area you think the worm is, pull the worm out with your knife. They will be one to 2 worms. Once you've killed the worms, place dirt and mulch over the site and water. The areas will then form roots and the plant will continue to produce. 

Fri, 07/25/2014 - 00:53 | 5002328 NickVegas
NickVegas's picture

Based on the tone, you still don't see it is by design.

Fri, 07/25/2014 - 06:40 | 5002666 Zodiac
Zodiac's picture

And don't forget the lush golf courses for the rich corporate types

Fri, 07/25/2014 - 00:04 | 5002233 AustriAnnie
AustriAnnie's picture

There are a few towns in California that would not have a service sector to speak of if not for the weed business.  Wonder what they would collect in sales tax if not for pot growers?  That, along with other cash-green businesses, are keeping some towns afloat.

But the pot growers are evil. We should stop those evil growers from consuming water! Especially since so many of them grow in locations such as Humboldt County and Southern Oregon, where water is so scarce....

I think we should give all the water to solar energy producation and fracking operations.  That would allow us to rule the world by being energy sufficient, and give us the power to force Putin into submission.  

 

Thu, 07/24/2014 - 21:09 | 5001752 Four chan
Four chan's picture

farm in an arid region, risk ending up in a desert. you are now there.

Thu, 07/24/2014 - 21:12 | 5001766 Abitdodgie
Abitdodgie's picture

So water went up 700% but dairy products will only go up 4% with the amount of water that cows drink, really?

Thu, 07/24/2014 - 23:32 | 5002169 FeralSerf
FeralSerf's picture

In California cows are fed a lot of corn. It takes a lot of water to grow the corn. Ditto alfalfa.

Thu, 07/24/2014 - 21:19 | 5001780 knukles
knukles's picture

Yep... Is reality.
Reality also is that there's goodly amount of water for Ag, but is shipped to urban areas.

If everybody paid same per "unit feet" the voters would go berserk.... but no lawns, etc.
This way they can feel it in food prices, no starve, but be told about an emergency, needs more government intrusion, regulation and higher taxes, etc.

Is part of the manipulation into the NWO's Agenda 21, etc, etc, etc, etc, 

Do not take this lightly.  CA either supplies directly most of the fruit, veggies and nuts to the USofA, etc., or at a minimum, sets the Ag prices at the margin. 
You folks at your NYC fancy restaurants, only reason your veggies are so fresh is they're air freighted to you.  Otherwise the peons eat the crap off a rail cars and trucks, across the country.
No shit, Sherlocks.

Hell, as another example, sardines caught in Monterey Bay* (lots and lots, guys) are trucked to Salinas for cleaning and flown on ice to Asia as a delicacy.
Screw this up and starve, Bitchez.

*they still haven't found John Denver's head

Thu, 07/24/2014 - 22:11 | 5001981 sleigher
sleigher's picture

No lawns?  "The city will fine me $500 if I don't keep a greem lawn?  But the state will fine me $500 if I do."

 

That alone should explain where we are and what to light on fire.

Thu, 07/24/2014 - 22:19 | 5002002 ACP
ACP's picture

Well, the CA Dept of Education has to pay for that $50 million in routers and servers that their IT department buys every year to justify their budget, which are sitting in closets, never to be used.

Thu, 07/24/2014 - 22:28 | 5002026 knukles
knukles's picture

Oh, so fucking true.  A fellow who'd worked (consultant) for the state once reported that CA has in excess of $7 billion in material purchased every year that is declared surplus, unneeded, junk, etc., and sold off.  Interestingly, the sales contracts are never widely circulated.  Nudge nudge wink wink.
And he said that is entirely similar, same practices, etc., in just about every other state.
No shit.
Oh, he was never retained after the initial report was submitted.
Rug meet sweep, sweep, meet rug

You self aggrandizement at work

Thu, 07/24/2014 - 22:35 | 5002040 ACP
ACP's picture

Speaking of consultants for CA...I've known several who worked for the state and quite often it takes up to 4 MONTHS to get paid for their work. Just regular IT folks who work alongside state employees.

But oh, when an actual EMPLOYEE gets furloughed for 3 days and month, holy shit the sky is falling!!!

Fri, 07/25/2014 - 06:46 | 5002675 Zodiac
Zodiac's picture

In the last drought here in Texas, I and everyone I knew just watered at 3-4 in the morning when the water nazis were not around. Fuck that shit you were talking about the city vs. the state.

Fri, 07/25/2014 - 06:51 | 5002681 Zodiac
Zodiac's picture

Also, you can water during the day if you use soaker hoses and don't let any water drip or flow onto any pavement.  Fuck the government nazis!

Thu, 07/24/2014 - 22:16 | 5001994 ACP
ACP's picture

Exactly...spoken from a true Central Valley resident (like I used to be).

Never let a crsis go to waste. What a money maker, $500 fines for watering your lawns or otherwise wasting water. Apparently it's more egregious than red light violations, which are "only" $483 + court fees and administrative costs, of course, at least in the Ebay.

Don't forget all the tomato losses from all the college students crashing big rigs while running illegal 20 hour shifts at the behest of their employers, while the CHP looks the other way.

Thu, 07/24/2014 - 23:55 | 5002206 FeralSerf
FeralSerf's picture

"If everybody paid same per "unit feet" the voters would go berserk.... but no lawns"

The homeowner pays a LOT more for an acre foot of water to water his (useless) lawn than the farmer pays. Figure it out -- how many acres of lawn does the average homeowner have? Maybe a twentieth of an acre? A foot of water on it should be enough for the year if he doesn't send too much down the gutter (which he usually does). That's only $50 for a year if water's $1,000/acre-foot. I pay that much every month.

California has very strange and unusual water laws compared with the rest of the dry country. Some groups get lots of water for a pittance, others pay much more if they can get it. It's all in the water RIGHTS.

Check out JG Boswell Co. They own a lot of water rights that are now worth a fortune. They use a lot of it growing cotton. Yum!

Fri, 07/25/2014 - 00:13 | 5002254 TBT or not TBT
TBT or not TBT's picture

A great read on this:   Cadillac Desert 

Thu, 07/24/2014 - 21:20 | 5001781 JR
JR's picture

Raising the cost of water from $1,100 per acre-foot from $140 a year ago rather than rationing because of the drought makes water districts no different from ambulance chasers.

To sell water to the highest capable bidder effectively eliminates the smaller operations.

Thu, 07/24/2014 - 21:20 | 5001784 F-Tipp
F-Tipp's picture

I wish anyone understood/cared knukles. This great state...

Fri, 07/25/2014 - 00:26 | 5002279 benb
benb's picture

Many do understand and do care.

Few Zerohedgers seem to.

This is the implementation of Agenda 21 and Neo-fuedelism. The weather is being manipulated to a great degree by NWO elements of the federal government who are sculpting the population distribution and impeding food production. It is done to drive people from the rural areas to later buy up the land for pennies on the dollar. It is done to also impoverish the population and drive them into the cities.

Again, the drought is induced. It is called weather modification.

If you don't know that you're just talking out your ass.

And that is the truth of the matter.

Fri, 07/25/2014 - 00:16 | 5002261 Chuck Walla
Chuck Walla's picture

Was just in the Central Valley. They are pissed and the land sits unused in some places. The new dust bowl.

FORWARD SOVIET!

Thu, 07/24/2014 - 21:14 | 5001768 max2205
max2205's picture

I thought NJ was the garden state

Thu, 07/24/2014 - 21:21 | 5001786 knukles
knukles's picture

Hah ha ha haha ha
NJ good at raising ghettos and poverty

Thu, 07/24/2014 - 21:39 | 5001865 DaveyJones
DaveyJones's picture

..and taxes

Fri, 07/25/2014 - 07:08 | 5002702 strangeglove
strangeglove's picture

More like the Garbage State!

Fri, 07/25/2014 - 07:24 | 5002719 Bingo Hammer
Bingo Hammer's picture

No water in Claifornia?....IT WAS PUTIN!

Putin did it!

(sorry I'm only writing what they told me to write)

Thu, 07/24/2014 - 20:57 | 5001714 WayBehind
WayBehind's picture

Food is getting more expensive but just wait when there is no food left ...

Thu, 07/24/2014 - 21:11 | 5001763 SHEEPFUKKER
SHEEPFUKKER's picture

Time to start eating Alpo, but what will Fido eat?

Thu, 07/24/2014 - 21:14 | 5001769 XenoFrog
XenoFrog's picture

Don't worry. Our Dear Leader is working on an executive order to add pets to the EBT Food Stamp program.

Thu, 07/24/2014 - 21:26 | 5001797 knukles
knukles's picture

Yes, and the FF's purebred Portuguese Water Dog rorm show bloodlines gifted by Ted Kennedy (? or other prominent politician) made sure that there were no pound puppies in the palace.

The prince was ghastly, yet the peasantry cried, nonetheless

Fri, 07/25/2014 - 00:17 | 5002264 Chuck Walla
Chuck Walla's picture

Old Teddy was a dog fucker, too? Not that surprised...

FORWARD SOVIET!

Thu, 07/24/2014 - 22:09 | 5001971 dobermangang
dobermangang's picture

Q: What did Obama say after eating a sled dog?

A: It tastes like mush.

 

 

Fri, 07/25/2014 - 08:04 | 5002811 ThisIsBob
ThisIsBob's picture

You.

Thu, 07/24/2014 - 21:30 | 5001825 world_debt_slave
world_debt_slave's picture

food companies are substituting real food with wood pulp. Read your food labels, anything that has "Cellulose" and/or derivative thereof is wood pulp, no nutrional value at all for humans.

Thu, 07/24/2014 - 21:43 | 5001872 Cruel Aid
Cruel Aid's picture

I , nowadays, go to the end game. They want higher prices, this will do it.. What does a drought in cal hv to do with snow in colo. Which had a load last year. Great year for skiing

Thu, 07/24/2014 - 21:02 | 5001733 Argos
Argos's picture

We need some research into cheaper desalination and iceberg towing.

 

NOW!

 

 

Thu, 07/24/2014 - 21:07 | 5001742 Spastica Rex
Spastica Rex's picture

Trouble, right here in (no) River City.

Maybe tow the icebergs in with monorails.

Thu, 07/24/2014 - 21:10 | 5001756 Four chan
Four chan's picture

what ice bergs lol earth 1 man 0

Thu, 07/24/2014 - 21:02 | 5001734 youngman
youngman's picture

Is this what they call the food pyrimid,,I bet dog and cat food is thru the roof too....granys like the stuff...good on a cracker

Thu, 07/24/2014 - 21:04 | 5001741 Antifaschistische
Antifaschistische's picture

Are the recipients of aqueduct water paying 10x also?  I still see green lawns in Pasadena and San Marino.  That water gets pumped a few hundred miles...and that pumping is not cheap either.

http://en.wikipedia.org/wiki/California_Aqueduct

 

Thu, 07/24/2014 - 21:11 | 5001760 knukles
knukles's picture

NO THEY HAVE NOT
NO THEY ARE NOT

They're still getting their allocations and prices in those areas for household water have not gone up that much.
What's happening is they (state and feds) take so much water and allocate it to "regions"/"uses".  They divert form the Central and SJ and Inland Valleys to the cities.  Thus the bidding within the valleys for less water causes the prices there to spike.... for the Ag users

This is not market price suppl and demand, this is central planning price control and shortages.

ObamaCare, communist central planning.  Worked out so fucking well in Russia, Eastern Europe and China, they're still doing it as rousing successes...
FUCK ME

Thu, 07/24/2014 - 21:41 | 5001869 DaveyJones
DaveyJones's picture

Yeah, Ive got family in the south end.  This is insane

Thu, 07/24/2014 - 21:57 | 5001927 Greenskeeper_Carl
Greenskeeper_Carl's picture

That shit still blows my mind. People that grow good for the entire country get their rates raised that much, and people in places like LA and the rest don't see their prices go up to water their lawn or fill their swimming pools. Rather than market forces and supply and demand, we get centrally planned bullshit which will just lead to us all being equally fucked.

Thu, 07/24/2014 - 21:12 | 5001764 adr
adr's picture

And every tribesman does their best Monty Burns "excellent" and they drive futures ever higher on the news.

Middle class gets squeezed even more. NYC billionaires buy more yachts.

Thu, 07/24/2014 - 21:13 | 5001765 darteaus
darteaus's picture

Around Los Banos (mid/south Central Valley) 25% of the land is fallow. So, 25% less food; "No inflation here; move along."

Thu, 07/24/2014 - 22:21 | 5002001 sleigher
sleigher's picture

The bathrooms.  Why the hell is that placed named the bathrooms?  Driven through probably 200 times.

Thu, 07/24/2014 - 22:35 | 5002045 in4mayshun
in4mayshun's picture

If you lived there, you'd understand.

Fri, 07/25/2014 - 00:01 | 5002230 directaction
directaction's picture

Why is it called The Toilets? Go there. You'll understand.

It's the toilet of the Central Valley, well, one of the many, many toilets. 

Thu, 07/24/2014 - 21:17 | 5001777 fzrkid
fzrkid's picture

Thi =s is fahking retahhhhted.. I have 2 springs, both licensed by DHHS for sale to the public here in Maine but cannot sell a drop....

 

 

Yes these clowns are farming in the desert... Let em dry up and blow away..

 

Anyone interested in buying water let me know

Thu, 07/24/2014 - 21:31 | 5001840 NuckingFuts
NuckingFuts's picture

As I have posted previously, I am a full time vegetable grower. Why you would start a farm where there is no good rain and/or irrigation is beyond me. Fuck them, hopefully makes my products grown, harvested and sold by Americans here in America more valuable..

Thu, 07/24/2014 - 21:41 | 5001874 DaveyJones
DaveyJones's picture

reason #537 why fertile land with decent rainfall will become one of the most valuable hard assets.

Thu, 07/24/2014 - 22:38 | 5002052 in4mayshun
in4mayshun's picture

News flash!!! You need more than water to grow vegetables for half the country. You also need damn fine soil, which the Ca Central Valley has plenty off. If water was the only factor, Seattle could grow crap for the entire world.

Thu, 07/24/2014 - 23:10 | 5002133 COSMOS
COSMOS's picture

KEY Ingredient is SUNSHINE, lots of it, you bring the water in and voila bountiful crops.  I have been to Maine, mostly cloudy and short summers, good luck getting good crop yields lol.  Just like a car you need sparks and gas to make it move.  Same thing with ag, you need sun and water.  That is why Brazil is ag dynamo.  Lots of sun and water too.

Thu, 07/24/2014 - 23:28 | 5002161 DaveyJones
DaveyJones's picture

check out Elliot Coleman, he does some pretty interesting growing in Maine. The major problem with modern Ag is not a lack of sunshine. The last time I checked a lot of the western world lives in some pretty high lattitudes. The major problem is centralization, toxic chemicals, topsoil destruction, GMOs, too many animals and plants of the same kind in one crowded place and idiotc water use that destroys the acquifers and the  water quality. Perhaps the worst of all is reducing the natural diversity and nutrient quality of hundered of plants to GMO corn and soy for man and animal alike.....  

Thu, 07/24/2014 - 22:43 | 5002064 Stan522
Stan522's picture

California's Central Valley is just west of the Siera Nevada Mountain Range and stretches approximately 450 miles. The mountain range is usually filled with snow and in the Summer, it melts thus providing hundreds of streams and rivers pouring westward into the valley. This valley is one of the most fertile valleys and produces roughly 8 percent of the nation's agricultural output by value. A couple years ago the devilcRAT leadership in Congress and the State voted to strip the water from the farmers due to a manufactured environmental cause concerning the Delta Smelt. Combine this with the fact that winters have been pretty dry has created this problem.

I live in San Diego County and this county as been building and filling resoviours  with water and essentially has not issue with water. I believe this problem is mostly man caused and blaming farmers in the Central Valley at this point in time is simply not true.

Thu, 07/24/2014 - 23:40 | 5002188 FeralSerf
FeralSerf's picture

There's been a lot of almond trees planted these last few years on land that's never had anything but grass on it.

It takes over a gallon of water to make EACH almond.

Thu, 07/24/2014 - 21:49 | 5001894 syntaxterror
syntaxterror's picture

Sounds like this might cause inflation to surge to 1.01% according to official government figures.

Thu, 07/24/2014 - 22:00 | 5001936 Joebloinvestor
Joebloinvestor's picture

Can't be right, the evil marijuana growers are using up all the water.

http://pixelusmaximus.com/gazelle/weed-blamed-for-california-drought/

Thu, 07/24/2014 - 22:29 | 5002031 Stan522
Stan522's picture

Well, this works out very well for Gubamint..... they no longer include the cost of food in their statistics for inflation...... KEEP THE LIES A COMIN........

Thu, 07/24/2014 - 22:36 | 5002049 Al Huxley
Al Huxley's picture

I've been following this to the extent that it's possible in the news, but it seems like, although there's a serious rainfall and melt shortage - running water, there's still a pretty large groundwater resource that's going to postpone any real crisis until either the rain comes or the acquifers are depleted.  Anybody who's there have any insight on this? 

 

Also, WTF is the deal with 'green law' bylaws in residential neighborhoods.  How the fuck is anybody outside California going to take this 'we have a drought' situation seriously when there are these stories of people getting fined because they're not watering their fucking lawns.  Are your municipal bureaucrats and politicians really that stupid, or is the whole water crisis overblown?

Thu, 07/24/2014 - 22:47 | 5002078 Stan522
Stan522's picture

I live in San Diego County.... while the State of kalifornia says to limit watering your yard a maximum 3 times per week at no more than 10 minutes per valve, my homeowners association walks around and citing me and my neighbors for brown grass... FUCK THEM......

Thu, 07/24/2014 - 23:21 | 5002154 potato
potato's picture

Can you paint it green?

Thu, 07/24/2014 - 23:36 | 5002181 BeerMe
BeerMe's picture

That would be fucking perfect.  A painting the roses red moment.

Thu, 07/24/2014 - 22:48 | 5002079 in4mayshun
in4mayshun's picture

We can go a few years without water literally running out. But similar to oil, you don't have to run out to cause a crises. As soon as it stops being cheap and abundant, it's over. But, I'm told that Hetch-Hetchy reservoir which supplies San Francisco with water, has one more year of reserves before it's on like donkey kong.

Thu, 07/24/2014 - 22:53 | 5002093 q99x2
q99x2's picture

Not to worry. We are only 1 year away from another arkstorm.

Thu, 07/24/2014 - 23:02 | 5002117 Seize Mars
Seize Mars's picture

quote: "...the government's decisiosn to withhold irrigation water to California for the first time in 54 years..."

Welcome to Marxism. Death rained upon you by the fucking State.

Thu, 07/24/2014 - 23:09 | 5002130 Jack Burton
Jack Burton's picture

No doubt all the farmers will be looking to government to solve their water problems. If not for tax payer spending to build many water systems, the farmers could never have farmed that dry valley. Read Steinbecks books, he wrote about those areas in the eras from late 1800's to middle 1900's. Drought was nearly every other year. Every decade or so a mass drought hit and made rich men poor. It is all in his stories. But government used public money to get water to farmers. If one of those mass droughts Steinbeck wrote about is here again, then blame god.

Thu, 07/24/2014 - 23:33 | 5002172 potato
potato's picture

Manufactured crisis. Environmentalists stop the construction of dams in the name of biodiversity.

What has biodiversity done for you lately? Species die and new ones mutate. Big deal. We are the highest form of life and saving a useless species at a huge human cost is immoral.

Thu, 07/24/2014 - 23:45 | 5002190 DaveyJones
DaveyJones's picture

"What has biodiversity done for you lately?"

Other than make your species evolve?

In economic terms, think of biodiversity as a free market with plenty of resiliency and redundancy. Now we've taken away most of that in modern economic systems. How are they doing?

Fri, 07/25/2014 - 02:19 | 5002439 basho
basho's picture

'We are the highest form of life'

you are sure of this? lol

 

Fri, 07/25/2014 - 00:01 | 5002226 FeralSerf
FeralSerf's picture

California may be short of water, but that's not stopping them from requiring more ethanol in the motor fuel.

It takes a lot of water to make a gallon of ethanol.

Fri, 07/25/2014 - 10:19 | 5003271 DaveyJones
DaveyJones's picture

ethenol is the most corrupt, energy wasting fuel product we've ever created. We now grow more corn for fuel than food. Idiotic.

Fri, 07/25/2014 - 00:15 | 5002257 GreedKillz
GreedKillz's picture

Meanwhile San Joaquin aquifers have only dropped 10% after two years 2010 and 2011 of record rainfall and especially snow pack with 2011 having sierra snowpack at 175% of normal. Translation= The Government is lying . Yes AGAIN. And that drop of 10% is the highest drop amongst CA aquifers which you would expect where water is used the most. Other CA aquifers have seen little drop if any at all

All Hype Machine

Fri, 07/25/2014 - 00:51 | 5002325 combatsnoopy
combatsnoopy's picture

keep posting.  A LOT of people are risking fines for water in Socal- and it's the same excuse with everyone.
The homeowners are just NOW catching on.

I wish I could show you pictures, but the golf course at Hope's ranch is starting to get bone dry.  The grass is still green though.  

Fri, 07/25/2014 - 01:09 | 5002353 thamnosma
thamnosma's picture

Situation normal, all fucked up

Fri, 07/25/2014 - 01:10 | 5002355 combatsnoopy
combatsnoopy's picture

Water is now a speculative commodity.
http://fortune.com/2014/06/25/water-futures-markets/

Fri, 07/25/2014 - 01:17 | 5002364 combatsnoopy
combatsnoopy's picture

Started by the Aussies, who export raw goods to CHina- and are not known to be the sharpest tools in the shed. 

"Waterfind’s service works much like any other electronic futures exchange, with a few twists. The firm does not have a formal clearinghouse, as U.S. exchanges do, but one of its units acts in that capacity. The wide variety of custom delivery dates, locations, and prices on the contracts recall what’s known on Wall Street as a “bespoke, over-the-counter” derivatives market, where banks design financial contracts to specific requirements of the buyers or sellers. Unlike those markets, however, Waterfind displays quotes to all parties—one of the defining traits of an exchange. Waterfind also acts as a broker on some of the trades, though the majority of its clients now trade on their own."

 

All of the boomer realtors and flippers wanted Quantitative Easing.  The bullshit part is that their karma is a negative externality. 

Fri, 07/25/2014 - 01:35 | 5002378 combatsnoopy
combatsnoopy's picture

of course oil companies are involved:

Bob Poole, a spokesman for Santa Maria Energy, a small oil producer in Santa Barbara County, said that oil companies must navigate the politics of drought in California. Santa Maria is planning to build an eight-mile pipeline to bring treated wastewater to its oil fields, where it injects steam and gas into rock to push out the oil in a process known as cyclic steaming.

The company chose to use treated wastewater, which is cheaper than freshwater, Mr. Poole said, adding, “We also felt that it was very important politically.”

In Kern County, oil producers and farmers have coexisted peacefully for decades, but that balance has changed in recent years. Advances in drilling technology have led oil companies to move into agricultural areas. In Shafter, just north of here, dozens of new oil fields are next to almond orchards and other crops. The possible eventual exploitation of a huge untapped oil reserve called the Monterey Shale, which lies under Kern County’s prime farmland, could mean the kind of intense fracking carried out in Texas and North Dakota.

http://www.nytimes.com/2014/07/08/us/california-drought-chevron-oil-fiel...

they wanted price inelastic taxes for oil, then tobacco..  Now WATER.   
Fri, 07/25/2014 - 01:36 | 5002380 combatsnoopy
combatsnoopy's picture

I just posted pics of Los Angeles flood this Feburary.
http://economicasylum.blogspot.com/2014/07/californias-drought.html 

Where was the drought?  

Fri, 07/25/2014 - 01:36 | 5002381 combatsnoopy
combatsnoopy's picture

I just posted pics of Los Angeles flood this Feburary.
http://economicasylum.blogspot.com/2014/07/californias-drought.html 

Where was the drought?  

Fri, 07/25/2014 - 01:44 | 5002388 zjxn06
zjxn06's picture

JG Boswell Company 

Symbol (BWEL) - Pink Sheet Stock

One of the largest farmers in the San Joaquin.

Mucho land and riparian water rights.

On a tear lately.

Check it.

Fri, 07/25/2014 - 02:16 | 5002436 basho
basho's picture

surely we can frack our way out of this. right?

Fri, 07/25/2014 - 02:25 | 5002442 pcrs
pcrs's picture

http://consumerist.com/2014/07/18/california-city-will-fine-couple-500-f...

Goverment always flourishes fines people if they water their lawn and fines them if they don't water their lawn.

Fri, 07/25/2014 - 02:57 | 5002477 JoJoJo
JoJoJo's picture

http://naturalresources.house.gov/issues/issue/?IssueID=5921   Billions of gallons of California river water flow directly into Ocean to protect smelt bait fish. Environmentalists also fighting building of desalinization plants on California coast.

 

 

 

Fri, 07/25/2014 - 03:00 | 5002478 teslaberry
teslaberry's picture

yes , i cannot wait to read the zh article a year from now talking about how terrible the idea of price controls and rationing is when wall street is going to invest in warehousing these foods, and then  creating a futures market for everyone of these foods, dwarfing the underlying contracts being physically delivered,  and will jack up the prices on all futures ----JUST BECAUSE THEY CAN. 

 

the problem with scarcity and finance is that the so called 'efficient market' is leveraged as a fools ideology. 

 

in efficient markets, the price of food is 'supposed to go up' because people want to EAT FOOD. but wall street knows this, and then uses cheap money to take advantage of efficient markets, by making them even 'more' yokeable with inflated specualtive dollars. 

 

it is as if there are two types of money. money that real people use to buy real things and moeny on wall street that is fast and furious. 

if the two types of money were simply separate , it would make it easier to deal with the abusive behavior of wall street. but they are not. and 'greed is good' just means that fast money fuck you money will fill the little guys mouth with shit instead of food. ---because there's more profit in it. 

 

it's essentially a giant FUCK YOU tax that is levied by new york elites instead of DC. that's all really....

Fri, 07/25/2014 - 05:10 | 5002590 jballz
jballz's picture

Turns out around 85% of Cali water usage is farmers. The plebs down south only suck 15.

Farmers waste an awful lot of water feeding all you useless cocksuckers.

Not that I wouldn't turn the spigot off for LA and let them drink each other's precious bodily fluids.

Can I get a plus one for the strangelove reference? Because I was going to say piss.

Fri, 07/25/2014 - 06:00 | 5002636 electropeasant
electropeasant's picture

something that must be acknowledged in relation to this west coast drought is that it's deliberate. i lived in san francisco for a few years, and noticed how dramatic aerosol spraying created weather patterns in other places and staved off local rain. often, the massive spraying of heavy metals and other toxic dreck in those miltrails 'they' sprayed off of the pacific coast would create weather patterns that would in turn wreak havoc on the midwest or east coast a few days later, causing epic tornadoes, floods, etc. essentially those other areas would get the rain that we would normally receive, causing catastrophe. then, after the miltrails passed, the weather would be gorgeous in san francisco for about a few days, almost like los angeles. no clouds, no trails, pure azure sky. then some day once again trails would commence spaced at 60 degrees and parallel. once again weather systems would hit elsewhere, rinse, repeat.

with the gouging of prices and crazy laws, seems like once again it's speculators and control systems that will make a killing and kill. elephant in the room.

Fri, 07/25/2014 - 06:49 | 5002678 Last of the Mid...
Last of the Middle Class's picture

Government owned water. Anyone see a problem with this?

Fri, 07/25/2014 - 08:57 | 5002974 gcjohns1971
gcjohns1971's picture

Government owned water.

Government owned land through the BLM.

Government owned homes through Fannie and Freddie.

We need only government owned jobs and we can declare the Marxist transformation complete.

 

Better if Homo Monachus (cause he sure as hell ain't Sapiens) went extinct.

Fri, 07/25/2014 - 07:28 | 5002726 AdvancingTime
AdvancingTime's picture

The price of certain foods could take some wild swings. Prices under the pressure of changes in supply and demand can be a lot like a carnival ride. By this I mean fast and abrupt swings can take place and often we see prices go to unimaginable extremes. It would be better to say changes in "supply or demand" because we should highlight and fully realize the market works best when at least one side of the equation remains somewhat stable. More on this subject in the article below.

http://brucewilds.blogspot.com/2014/02/inflation-can-effect-supply-and-d...

Fri, 07/25/2014 - 07:30 | 5002738 Milton Freewater
Milton Freewater's picture

Im sure the Fracking companies have no broblem finding water!

 

Fri, 07/25/2014 - 07:36 | 5002748 Its_the_economy...
Its_the_economy_stupid's picture

This California water/farming problem is as it should be. When they have to pay the real cost of water, truck farming will return to the rest of the nation. Hauling celery across the nation makes ZERO economic sense.

Fri, 07/25/2014 - 08:52 | 5002956 gcjohns1971
gcjohns1971's picture

Sorry Farmers,

The Liberal National Socialist elite only believe in an Urban-Serfdom lifestyle.

When people are spread out, and have the means to support themselves, they are too hard to control.

Fri, 07/25/2014 - 08:55 | 5002964 gcjohns1971
gcjohns1971's picture

The reason I do not see this as a normal water supply issue, is because there is a monopoly supplier of water, who also has a monopoly on force - the government.

I think everyone can agree that the farmers need to bid for water against other farmers up stream.

Fri, 07/25/2014 - 09:04 | 5002992 gcjohns1971
gcjohns1971's picture

This is what I am talking about:

 

"What's happening is they (state and feds) take so much water and allocate it to "regions"/"uses".  They divert form the Central and SJ and Inland Valleys to the cities.  Thus the bidding within the valleys for less water causes the prices there to spike.... for the Ag users"

 

ONLY the farmers in California are getting dramatically increased prices - because the monopoly provider prefers the urban lifestyle.

Fri, 07/25/2014 - 08:57 | 5002971 Hurdy Gurdy Man
Hurdy Gurdy Man's picture

The government should pull the eminent domain card on all Nestlé water producing properties in California.

 

It isn't as if Nestlé is paying taxes anyway, probably.

Fri, 07/25/2014 - 08:58 | 5002972 Hurdy Gurdy Man
Hurdy Gurdy Man's picture

[accidupe]

Fri, 07/25/2014 - 10:08 | 5003010 Slarti Bartfast
Slarti Bartfast's picture

Farmers are a huge user of water, and a very inefficient user of water at the same time.

Maybe they will take some steps to increase water efficiency now?

It won't get them 700% in savings though.

Fri, 07/25/2014 - 09:29 | 5003092 RaceToTheBottom
RaceToTheBottom's picture

California needs to raise price of farming water.  Presently it makes sense to grow friggin rice in Northern CA.  Rice Paddies!!!!

Fri, 07/25/2014 - 10:14 | 5003260 mastersnark
mastersnark's picture

I knew my decision to avoid eating vegetables was a smart move. I remain "over-weight" in my allocation of candy bars, soda, and JBX tacos.

Fri, 07/25/2014 - 10:53 | 5003447 mickeyman
mickeyman's picture

Everyone knows that rising food prices don't count as inflation.

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