California drought cost the state's ag industry billions in 2022, says study

California’s agriculture sector and food processors experience $2 billion in value added losses and cut almost 20,000 jobs.

Losses mount as California officially wraps up its third year of drought. The Golden State suffered a $1.7 billion loss in crop revenues for 2022, according to a recent study by researchers at the University of California, Merced

The loss was directly attributed to the reduction in crop acreage. Farmers, ranchers and food processors already lost $1.3 billion in 2021 during the drought that started in 2020 and continues today.

"Strategic short-term land idling was the most common cropping decision adaptation in this drought," said the study authored by Jose Medellin-Azuara, Associate Professor of Environmental Engineering at U.C., Merced.

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During the drought, FOX Weather talked to dairy farmers who had to cull their cows because hay production, a diet staple, dropped by almost 30% after water cutbacks. Many of the state’s rice farmers chose to not plant their thirsty crop. And fruit growers have been retiring, removing, whole sections of orchard early to keep only younger, higher-producing trees and still use less water. 

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California lost 19,414 ag and food processing jobs due to drought as well, says the study.

Medellin-Azuara and his associates estimate more than 752,000 acres lay idle and uncultivated in 2022, compared to 2019. That is almost 10% of the state's ag land. Fallow acreage totals rose 189,000 from 2021.

But California’s Central Valley, which many people call "America’s Breadbasket" appears to be hit harder. Over 520,000 of those acres, about 70%, lie from the Sacramento Valley to north of Los Angeles County in the center of the state. The area also lost 7,400 jobs in the industry, 40% of those lost in the entire state.

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"California is a state that is no stranger to drought," Medellin-Azuara told FOX Weather Sunday. "But what is different this time around is that the areas that are in the northern part of the state that are traditionally wet are dry this time around, and that creates some issues for water supply, for agricultural areas… particularly in the areas south of the San Francisco Bay that have less population."

The researcher said that surface water deliveries dropped by almost 43% for both 2021 and 2022. Many farmers turned to pumping groundwater. The increased water mining from aquifers cost the state over $300 million and dropped water levels, rendering many wells dry.

"We suffer from chronic groundwater overdraft," said Medellin-Azuara. "Many of the areas are still suffering from dry wells, particularly domestic wells that are closed by agriculture."

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He says those Californians are suffering the "double weight of drought." Drought cost them agriculture jobs and increased pumping during drought dried their well.

The Central Valley occupies only 1% of the nation's farmland but produces a quarter of the nation's food, according to the U.S. Geological Survey

Golden State agriculture generated $51.1 billion in 2021. That is up about 3.6% over 2020. The study suggests that inflated prices are offsetting the higher production costs and net food losses.  

Agriculture accounts for almost 3% of California's Gross Domestic Product.

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