Pacific Ag Commodities: New reservoir for Texas growers & continued drought problems in California

September 13, 2014

Markets/Trade –

Oryza.com reports that as part of South Korea’s efforts to liberalize the country’s rice market, the government has opted to increase direct subsidies to rice farmers as a means of alleviating farmers fears of being driven under by cheap imports. Oryza.com reports that Cambodia stands a substantial chance of claiming a greater part of Chinese rice imports as China’s growing consumption of rice and contaminated agricultural fields open the door for greater imports. Chinese rice production is switching to northern areas due to soil pollution in the southern regions, which could provide Cambodian exporters an easy access market if they can overcome China’s stringent import procedures as transporting rice from China’s northern regions would be much more costly than shipping it from Cambodia.

Production –

Matthew Tresaugue reports for the Houston Chronicle that the Texas Water Development Board last week approved a $250 million low-interest loan to Wharton County for the construction of a new reservoir to help ensure adequate irrigation water for local rice growers. The reservoir is to be located about 70 miles southwest of Houston to capture heavier rains that fall downstream of Lakes Travis and Buchanan and is estimated to provide 90,000 acre-feet of water per year for area rice farmers. The reservoir is expected to completed in 2017. Mark Koba of NBC News reports that water shortages in California are not only having drastic impacts on this year’s rice crop but could see more far reaching problems. Farmland values are up 15-20% and sales are booming as larger operations expand their acreage, but many smaller farms face the harsh reality of having to sell out of the farming business if water isn’t forthcoming soon. Thousands of rice acres went unplanted this year in the state, and many farms opted to sell their water rather than attempt to produce a crop.

Environment –

Tom Stienstra reports for the San Francisco Gate that the severe drought affecting California is causing problems not just for rice growers but for migrating water fowl and other shorebirds as well. These birds require wetlands to stop and rest in on their yearly flights, many of which are currently bone dry. Both national refuges and area rice fields that typically provide habitats for these birds are largely empty due to the lack of water, but some area farmers are helping to alleviate the problems by flooding fields early from private wells, providing stopping points for birds while maintaining their rice crops. Oryza.com reports that new research has shown that rice cultivation methods in China could be designed to not only improve yields but also to reduce environmental damage from crop production. Called the Integrated Soil-Crop System Management approach, the program has been shown to increase yields while decreasing the amount of greenhouse gases released and water contamination from chemical runoff. – Source: AgFax Rice Review