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Chapter 3. Emerging Water Shortages: Farmers Losing to Cities
Water conflicts among countries dominate the headlines. But within countries it is the jousting for water between cities and farms that preoccupies local political leaders. The economics of water use do not favor farmers in this competition, simply because it takes so much water to produce food. For example, while it takes only 14 tons of water to make a ton of steel worth $550, it takes 1,000 tons of water to grow a ton of wheat worth $150. In countries preoccupied with expanding the economy and creating jobs, the policy decision to make agriculture the residual claimant comes as no surprise. 55
Many of the world’s largest cities are located in watersheds where all available water is being used. Cities in such watersheds, such as Mexico City, Cairo, and Beijing, can increase their water consumption only by importing water from other basins or taking it from agriculture. Literally hundreds of the world’s cities are now meeting their growing needs by taking irrigation water from farmers. Among the U.S. cities doing so are San Diego, Los Angeles, Las Vegas, Denver, and El Paso. A USDA study of 11 western states found that annual sales of water rights during 1996 and 1997 averaged 1.65 billion tons, enough to produce 1.65 million tons of grain. 56
World Bank calculations for densely populated South Korea, a relatively well watered country, indicate that growth in residential and industrial water use there could reduce the supply available for agriculture from 13 billion to 7 billion tons in 2025. The Bank also projects that between 2000 and 2010, China’s urban water demand will increase from 50 billion to 80 billion tons, a growth of 60 percent. Industrial water demand, meanwhile, will go from 127 billion to 206 billion tons, up 62 percent. Several hundred cities are looking to the countryside to satisfy their future water needs. In the region around Beijing, this shift has been under way since 1994, when farmers were banned from drawing on the reservoirs that supplied the city. 57
As China attempts to accelerate the economic development of the upper Yellow River basin, emerging industries upstream get priority in the use of water. And as more water is used upstream, less reaches farmers downstream. In unusually dry years, the Yellow River fails to reach Shandong, the last province en route to the sea. 58
Farmers in Shandong, who have traditionally received roughly half of their irrigation water from the Yellow River and half from wells, are now losing water from both sources. Irrigation water losses in a province that produces one fifth of China’s corn and one seventh of its wheat help explain why China’s grain harvest is declining. 59
Literally hundreds of cities in other countries are meeting their growing water needs by taking some of the water that farmers count on. In western Turkey, for example, the city of Izmir now relies heavily on well fields from the neighboring agricultural district of Manisa. 60
In the U.S. southern Great Plains and Southwest, where virtually all water is now spoken for, the growing water needs of cities and thousands of small towns can be satisfied only by taking water from agriculture. A monthly magazine from California, The Water Strategist, devotes several pages to a listing of water sales in the western United States during the preceding month. Scarcely a day goes by without another sale. Eight out of 10 sales are typically by either individual farmers or their irrigation districts to cities and municipalities. 61
Colorado, with a fast-growing population, has one of the world’s most active water markets. Growing cities and towns of all sizes in a state with high immigration are buying irrigation water rights from farmers and ranchers. In the upper Arkansas River basin, which occupies the southeastern quarter of the state, Colorado Springs and Aurora (a suburb of Denver) have already bought water rights to one third of the basin’s farmland. Aurora has purchased rights to water that was once used to irrigate 9,600 hectares (23,000 acres) of cropland in the Arkansas valley. 62
Far larger purchases are being made by cities in California. In 2003, San Diego bought annual rights to 247 million tons (200,000 acre-feet) of water from farmers in the nearby Imperial Valley—the largest rural/urban water transfer in U.S. history. This agreement covers the next 75 years. In 2004, the Metropolitan Water District, which supplies water to 18 million southern Californians in several cities, negotiated the purchase of 137 million cubic meters of water per year from farmers for the next 35 years. Without irrigation water, the highly productive land owned by these farmers is wasteland. The farmers who are selling their water rights would like to continue farming, but city officials are offering far more for the water than the farmers could possibly earn by using it to irrigate crops. 63
In many countries, however, farmers are not compensated for a loss of irrigation water. In 2004, for example, Chinese farmers along the Juma River downstream from Beijing discovered that the river had stopped flowing. A diversion dam had been built near the capital to take river water for Yanshan Petrochemical, a state-owned industry. Although the farmers protested bitterly, it was a losing battle. For the 120,000 villagers downstream from the diversion dam, the loss of water could cripple their ability to make a living from farming. 64
Whether it is outright government expropriation, farmers being outbid by cities, or cities simply drilling deeper wells than farmers can afford, the world’s farmers are losing the water war. They are faced with not only a shrinking water supply in many situations but also a shrinking share of that shrinking supply. Slowly but surely, cities are siphoning water from the world’s farmers even as they try to feed some 70 million more people each year. 65
55. Water to make steel from Postel, op. cit. note 35, p. 137; price of steel as of June 2005 from Michael Fenton, Iron & Steel Commodity Specialist, U.S. Geological Survey, e-mail to Erin Greenfield, Earth
Policy Institute, 21 July 2005; 1,000 tons of water for 1 ton of grain from FAO, Yield Response to Water (Rome: 1979); price of wheat from International Monetary Fund, International Financial Statistics, http://ifs.apdi.net, July 2005.
56. Noel Gollehon and William Quinby, “Irrigation in the American West: Area, Water and Economic Activity,” Water Resources Development, vol. 16, no. 2 (2000), pp. 187–95; Postel, op. cit. note 35, p. 137.
57. Gershon Feder and Andrew Keck, Increasing Competition for Land and Water Resources: A Global Perspective (Washington, DC: World Bank, March 1995), pp. 28–29; population projections from United Nations, op. cit. note 1; China water demand from World Bank, op. cit. note 8; Brown and Halweil, op. cit. note 33.
58. Postel, op. cit. note 33, pp. 65–66.
59. Brown and Halweil, op. cit. note 33.
60. Shah et al., op. cit. note 18.
61. Gollehon and Quinby, op. cit. note 56, pp. 187–95; The Water Strategist, various issues at www.waterstrategist.com.
62. Arkansas River basin from Joey Bunch, “Water Projects Forecast to Fall Short of Needs: Study Predicts 10% Deficit in State,” Denver Post, 22 July 2004.
63. Dean Murphy, “Pact in West Will Send Farms’ Water to Cities,” New York Times, 17 October 2003; Tim Molloy, “California Water District Approves Plan to Pay Farmers for Irrigation Water,” Associated Press, 13 May 2004.
64. “China Politics: Growing Tensions Over Scarce Water,” The Economist, 21 June 2004.
65. Population from United Nations, op. cit. note 1.
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