Exploring the Potential Benefits of Agricultural Water Markets in Deep South, USA
Abstract
Water is key to agriculture, and agricultural water markets could be the basis for scientific water resource management, setting a reasonable water price, and establishing orderly water commerce. Due to the immense water share in agriculture and the low efficiency of the majority of irrigation water systems, the transfer of water use rights to higher value agricultural purposes is at the heart of an agricultural water market's development. Although agricultural water markets have several advantages, they have only been considered theoretically and quantification of their economic benefits is unexplored especially in the deep south of the United States. In this study, we studied agricultural water productivity in the Mobile River Basin in Alabama, Mississippi, and Georgia (i.e., the Deep South) of the United States to evaluate the economic benefits of agricultural water markets, particularly in the event of future water shortages under climate change. We employed Lorenz curve to analyze the benefits of water markets by using county scale crop share, agricultural water use, and demand datasets. We projected the future water use/demand data under Shared Socio-economic Pathway (ssp) 585 climate change scenario. The results showed that agricultural water markets could save $65.63 million and $80.13 million per year during 2026-2040 and 2041-2055, respectively, relative to present agricultural water allocation. Agricultural water markets give farmers greater options for dealing with irrigation water shortages, allowing them to allocate water to higher-value applications. Currently, in the actual food production process, the economic benefit of agricultural water market is unrealized, and continuing this may lead to severe water shortage and economic loss in the future.
- Publication:
-
AGU Fall Meeting Abstracts
- Pub Date:
- December 2021
- Bibcode:
- 2021AGUFM.H55V0989H