HOLDREGE, Neb.-
Less water plus less irrigation add up to less grain to fill elevators and money to fill bank accounts of farmers and merchants alike.
That simple math shows how complicated an agricultural economy can get, and a study by University of Nebraska-Lincoln experts has put price tags on what might happen if irrigated fields in the already water-short Republican River basin go wanting or without.
The $9,000 UNL Bureau of Business Research study was commissioned by the basin’s four natural resources districts: the Lower, Middle and Upper Republican NRDs and the Tri-Basin NRD.
The study focused on the Lower, Middle and Upper Republican NRDs.
Bureau Director Eric Thompson, in presenting the study findings Friday at a combined meeting of the NRDs, said reducing irrigation would not have just a short-term impact.
“In parts of the state already losing population, the impact can permanently reduce the overall size of the economy,” he said.
The study examined the economic effects if there were further reductions in irrigation allocations of 15 percent for upland wells and 40 percent in quick-response wells closer to the river.
It focused on five crops: corn, wheat, soybeans, grain sorghum and alfalfa, using current prices and forecasts.
“If prices go up from these per-bushel estimates, the economic impacts will be even more,” Thompson said.
The loss in commodity sales ranged from $23.4 million a year in the Upper Republican to $15.6 million in the Lower Republican.
The overall effect on economic output was estimated at $81.6 million in the Lower, Middle and Upper Republican NRDs.
“All figures assume there is no compensation for the reduction in water farmers are allowed to apply per acre, such as purchasing water from irrigation districts or paying farmers not to irrigate,” Thompson said. “Compensations may reduce the economic impacts, but it won’t eliminate them.”
It was assumed the lost production would lead to less income and lower local purchases.
“Lower spending on irrigation, transportation and nitrogen imply lost activity on the farm, but also less activity at local businesses or (by) individuals who provide these products and services,” the study report says. “Second, lost sales imply lower farm proprietor income. Less proprietor income implies less spending in the community.”
The study estimated that 503 full-time or part-time jobs would be lost as well and that lost property value would hit $82.1 million in the Lower Republican NRD, $93.1 million in the Middle Republican and $102.3 million in the Upper Republican.
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Information from: Kearney Hub,
