Drought by the Dollars: Impact on California Ag

A preliminary report on the cost of drought to California agriculture suggests the toll could reach $2.7 billion.

The University of California-Davis and ERA Economics released a report to the California Department of Food and Agriculture in May that forecasts:

• Milk revenue will decrease by about 3%, or $250 million, because of the drought.
• The cattle and calf industry will lose about $100 million.
• About $856 million will be lost in gross crop revenue.
• Direct job losses in agriculture will reach nearly 8,560.

The report considers additional data such as increased water pumping costs—$595 million—for farmers, and multiplier effects such as losses in related industries. With those considerations, the report suggests the economic impact could be $2.7 billion. S