Showing posts with label water rights. Show all posts
Showing posts with label water rights. Show all posts

Friday, January 2, 2015

Pumping Lowering Water Levels


Thanks to a severe, multiyear drought and increased demand for water, groundwater levels in the Upper Rio Grande Basin in Colorado, New Mexico and Far West Texas have dropped as much as 200 feet through the years.

A water expert at New Mexico State University (NMSU) warns those levels are just the tip of the iceberg as a sluggish recharge of the river, combined with increased groundwater pumping in the years ahead, will create worse shortages in the near future.

Brian Hurd, an agricultural economics professor and president of the Universities Council on Water Resources was quoted recently in the El Paso Times, saying that the threat of coming water shortages in New Mexico and Texas represents a serious problem for farmers up and down the entire basin region.

"The real big deal is going to be the change in the intensity of pumping," Hurd told the Times (http://bit.ly/1ricO5E).

Hurd and government hydrologists agree that river flows in the Rio Grande will suffer more as the demand for groundwater increases as a result of growing population density and the need for more water for agricultural and industrial activities.

In a 2013 joint Upper Rio Grande Impact Assessment prepared by the U.S. Department of the Interior's Bureau of Reclamation, the U.S. Army Corp of Engineers and the Sandia Laboratory Climate Security Program, even at the current annual use of groundwater throughout the Basin, critical water shortages will intensify in the years ahead.

According to that assessment, in the Upper Rio Grande Basin of Colorado and New Mexico, water management challenges posed by a highly variable and extremely limited water supply have been exacerbated by a prolonged drought.

In addition to problems associated with heavy groundwater pumping, the assessment determined that pronounced changes in climate in future years are anticipated for the Upper Rio Grande. The climate modeling used to support the study suggested that average temperatures in the Upper Rio Grande Basin may rise by an additional 4 degrees to 6 degrees F by the end of the 21st century.

Simulations

These model simulations do not consistently project changes in annual average precipitation in this basin, but they do project changes to the magnitude, timing, and variability of inflows to the system. In addition to groundwater demand, the study detailed the following:

  • Decreases in overall water availability
Supplies of all native sources to the Rio Grande are projected to decrease on average by about one third, while flows in the tributaries that supply the imported water of the San Juan-Chama Project are projected to decrease on average by about one fourth.
  • Changes in the timing of flows
The seasonality of flows is projected to change. Anticipated changes include earlier snowmelt runoffs as well as increased variability in the magnitude, timing, and spatial distribution of streamflow and other hydrologic variables. Projections indicate that this basin will experience a decrease in summertime flows and less of a decrease (or potentially even an increase) in wintertime flows.
  • Increases in the variability of flows
All simulations used in this study project an increase in the month-to-month and inter-annual variability of flows over the course of the century. The frequency, intensity, and duration of both droughts and floods are projected to increase.

While climate change will increase the risks of water shortage in the basin area, of more immediate concern is how communities and industry will react to current shortages. While recent drought conditions have lowered reservoir levels and decreased inflows to lakes, increased pumping of groundwater has helped to sustain adequate resources in the short term.

Challenges Ahead

But hydrologists say the time for such groundwater relief may be short lived as demand increases and groundwater levels continue to drop.

Zhuping Sheng, a hydrologist at the Texas A&M AgriLife Research and Extension Center in El Paso, draws a comparison with putting money in the bank.

"We're withdrawing more than we are depositing," he says.

He points out that in some areas around El Paso, for example, groundwater levels have dropped by as much as 200 feet over the last century.

Hydrologists say as groundwater continues to diminish as a result of slower recharge and greater use, population levels along the basin are expected to rise, adding a greater strain on the region's hydrology.

Adding to the overall problems are both the ongoing drought and lighter-than-normal snowpacks in the San Juan mountains in recent years. Water experts say significant and beneficial rains over the last two summer and fall seasons have helped, but it was "like putting a Band-Aid on a major wound."

As farmers prepare for planting in 2015, concerns are elevated over whether there will be enough water to bring their crops to another successful harvest. Good rains in the second half of this year should provide enough water to get the crop started, but experts say another dry summer could be devastating if those rains don't continue late into the growing season.

Wednesday, June 25, 2014

Waiting for Proper Time to Irrigate


With seemingly abundant water supplies in the five Delta states of Arkansas, Louisiana, Mississippi, Missouri and Tennessee, many can't understand why anyone would ever have to irrigate.  Crop histories show that at some point in every season irrigation would pay dividends in the five state area.

Recently Jason Krutz, irrigation specialist with Mississippi State University, took an ag editor from Delta Farm Press on a tour to educate about water issues facing the Mississippi Delta.  He discussed how the use of flow meters, moisture sensors, and surge valves have helped farmers grow the same, and sometimes, more crops with less water.

Krutz and several members of the Mississippi Sustainable Water Resources Task Force stopped at a field operated by Tim Clements near Leleand, MS.  They demonstrated how the new technology could one day help farmers alter the current situation in which Delta farmers are removing more water from the alluvial aquifer than it is taking in.

Friday, September 20, 2013

Unique Midwest Opportunity

A Unique Opportunity

We at Rural KC truly believe we live in the hot spot of cropland.  Right along the Kansas Missouri border.  Eastern Kansas and Western Missouri present special investment opportunities.  These two states are currently undervalued as compared to their productive capability.  Missouri in particular offers two advantages for first time cropland investors.

Missouri has a culture of cash rent as compared to a share crop culture such as Kansas.  Missouri also has a free capture on water for irrigation.  That means any water on, borders or adjacent to the property can be use for irrigation.  In Kansas you have to get permits to use water and usually you have a limit in the amount.

However, for the more seasoned and aggressive investor, Kansas may be the one for you.  Share cropping is the norm in that side of the border.  If you feel comfortable enough and willing to take the risks, Kansas provides that option to you.

The Efficiency of Farmland

Let's compare Iowa to Eastern Kansas and Western Missouri.  In Iowa per acre you can get 280 bushels per acre with a rent of $450 per acre.  That would make your return on investment 4.5% at a per acre cost of $10,000.  Now let's compare that to Kansas/Missouri.  You would get 170 bushels per acre with a rent of $110 to $350 per acre.  That would bring in a return on investment of 4% to 5% at a per acre cost of $5,000 to $2,500.  Based on comparative production of bushels, per acre cost in Eastern Kansas and Western Missouri would be $6,072.

Common Mistake

There are many things we hear over and over again in our industry from buyers.  But by far this is the most common thing we hear.  "I had a chance to buy that for $_____ back in _____ and didn't do it.  I'm still kicking myself."  Do yourself a favor, don't be that guy.  We can help you avoid that.  Call us at 913-837-4665 or email us at info@ruralkc.com.

Friday, August 9, 2013

How to Make Money Off Cropland


There are many ways people get revenue off of cropland.  The most traditional way is through the annual income, such as cash rent or share crop, and land appreciation.  

Annual income can come in various different ways.  One way is cash rent.  This is usually gain by receiving bids from farmers and they tend to be competitive.  This is the way most first time investors go.  It's the simplest way and has the least amount of risk to the investor.  The second way is share crop.  This tends to be done by more experienced investors.  They are typically 1/3 2/3 shares.  The positive is the investor usually makes more money this route.  However, they are usually more involved in the day to day decision making and if the crop fails or comes in poorly they take a hit along with the farmer.  And the final way to make income is through land appreciation.  I've gone over this a lot but to summarize it, cropland averages a 6% increase in appreciation annually over the last 40 years.  And we saw a massive jump in the last two years averaging 10% to 30%.

Now for the additional streams of revenue most people don't think of.


One additional source would be mineral rights.  This pertains to everything below ground of the property.  Things such as oil and gas leases and coal are the most common.  Another one is hunting leases.  The price of a hunting lease varies from property to property and how it's decided.  For example, you can decide the lease per acre, per hunter or, if it's a wetland, it could be a wetland lease.  Sub surface water rights is also another issue to think of.  Not too big of a deal in wet areas but places like western Kansas it can be an issue.  There are also government programs in place.  There is the conservation preserve program or CRP.  That is when the government pays the land owner a yearly amount to allow the land to grow naturally.  The is wildlife habitat incentive programs or WHIP.  It's similar to CRP but instead of just leaving it alone the government creates a habitat to promote wildlife growth.  There is also wetland reserve program or WRP.  Similar to CRP.  Allows a wetland to remain untouched and promote wildlife growth.  And finally there are wind leases.


Wind leases are becoming more and more common.  The issue is you have to have your land adjacent to other turbines to tap into a wind lease.  You have to think of it like an electric grid.  And it's expensive to put in so they will only add on to wind farms and rarely put up new ones.