Industry Trends for California Water & Ag | 11.16.20 |
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INFRASTRUCTURE & PRICING
By Cadiz Inc. Press Release, 10/29/20
Cadiz Inc. (NASDAQ: CDZI) (“Cadiz”, the “Company”) is pleased to announce that the Cadiz Water Project, the Company’s public-private partnership with California water providers to deliver new water supplies and groundwater storage for Southern California, was recognized today by global infrastructure strategy organization CG/LA as the Sustainability/Green Infrastructure Project of the Year at the North American Infrastructure Leadership Forum held virtually from Washington D.C.. The Infrastructure Project of the Year Awards, which are sponsored by Oracle Construction and Engineering, recognize projects identified for creating infrastructure opportunities via outstanding commitment across five categories: Job Creation, Sustainability/Green Infrastructure, Finance/Funding, Engineering, and Strategic.
Where market challenges present undue inefficiency and risk, we see an opportunity to bring our expertise to engage participants and drive solutions. Thus, when our partners, West Water and Veles Water, demonstrated a unique ability to capture transaction-level data in the California water market, light bulbs started going off. With a clear understanding of such inefficiencies, Nasdaq and its partners proudly introduced in October 2018, a first-of-its-kind solution in the form of an aggregate, volume-weighted index, the Nasdaq Veles California Water (NQH20) Index, which tracks the spot price of water in the state of California. Now, in collaboration with CME Group, we are excited to announce the next step in realizing our vision for the California water market: a novel futures contract linked to the NQH20 Index, empowering market participants for the first time, with the unprecedented means to manage water price risk.
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WATER SUPPLY & DEMAND
By Orange County Register, 11/15/20
Building homes, not apartments, is housing’s sweet spot in this pandemic era. Homebuilders across California filed 17,042 permits this summer for single-family homes — the second-busiest quarter since 2007, according to U.S. Census Bureau stats compiled by the St. Louis Fed. My trusty spreadsheet says that pace is a 42% surge from the spring’s pandemic-induced chill and up 18% from a year ago. It’s all part of a widespread and curious coronavirus impact on housing. Amid the pandemic, house seekers share a growing desire for more living space. As the economy emerged from a springtime lockdown, we saw house hunters, lured by historically low mortgage rates, push California homebuying to levels not seen since before the Great Recession.
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By Bakersfield Californian, 10/30/20
Some say that California never really left an earlier years-long drought. Rather, it only received a brief respite of water last year that raised hopes the dry years were over. A high-pressure ridge that lingered over the eastern Pacific during much of January and February diverted winter storms and hopes of much needed rain. Even anticipated March sprinkles were not expected to do much to spare California from an approaching drought. Most of the state received less than 5 percent of normal rainfall during February – tying 2020 as the 10th driest February since 1899. Nearly 70 percent of the state, including much of the Central Coast and Southern California, were classified as “abnormally dry.” About 23 percent of California, including a large part of the San Joaquin Valley and its surrounding mountains, were classified as having “moderate drought conditions.”
By Agri-pulse, 10/29/30
The proposed Temperance Flat Reservoir Project has likely seen its final blow after more than two decades of hard-fought efforts. With tepid interest from water contractors, the project is unlikely to meet a critical deadline for drafting an operating plan. The project authority attributed the loss to a cascading series of impending water crises over the years that have detracted local water contractors from investing in the reservoir. The effort has been crippled by state agencies as well, along with a price tag that did not pencil out well for farmers. The backers have faced fierce opposition from environmental groups.
By Fox40 Web Desk, 10/29/20
Lobbing another hurdle at California’s $16 billion plan to tunnel underneath the West Coast’s largest estuary, environmentalists on Thursday sued to freeze public funding for the megaproject championed by Gov. Gavin Newsom. Led by Sierra Club and the Center for Biological Diversity, a familiar coalition of critics claim the cash-strapped state is pursuing a “blank check” for a project that isn’t fully cooked.
By CA Public Radio, 11/12/20
Benedicto Cazares does not turn on his tap. He and his neighbors of East Orosi, an unincorporated community of about 1,000 people in the San Joaquin Valley, have been dealing with unsafe levels of nitrates in their water supply for years — and paying for it. “We had to keep paying the bill as if it was clean water,” Cazares said, speaking through a translator. He now receives free deliveries of 5-gallon jugs of bottled water every two weeks. Those jugs are the family’s sole source of water for their household. Some weeks, especially when it’s hot, they run out and have to buy bottled water to make up the difference. Cazares is one of about one million Californians who lack access to safe and affordable drinking water. In 2019, California took a big step towards tackling that problem. A first-of-its kind law set up a new fund and program to improve access to safe and affordable drinking water in communities like East Orosi.
By US Geological Survey, 11/1/20
Wildfires are a natural process in many ecosystems, playing an important role in nutrient cycling and other ecological interactions. But the size, severity, and the length of the fire season have increased substantially in the western U.S. over the past few decades, and these trends are predicted to continue. The year 2020 provided stark evidence that wildfires are changing the landscape of America. Over 8 million acres – almost the size of Connecticut and New Jersey combined – were ablaze this year, including the largest recorded fires in California and Colorado history. Wildfires burned watersheds on the western side of the Cascade Mountains in Oregon, a region that is typically very wet and where fires are rare. Over $3.2 billion has been spent to suppress these fires nationally, and thousands of people have evacuated their homes.
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WEATHER & CLIMATE
By EOS, 10/28/20
This winter is likely to be warmer and drier than average for most of the continental United States, in line with the conditions of a typical La Niña year. This information is according to the most recent NOAA seasonal forecast released on 15 October. Like the past 2 years, more than two thirds of the continental United States, northern and western Alaska, and Hawaii will likely experience hotter than average temperatures through January 2021. Southern Alaska and states along the northern U.S. border may see colder than average temperatures, and no confident temperature forecast can be made for the remaining regions
By Western Farm Press, 11/12/20
La Nina conditions in the Pacific Ocean may lead to the second straight drier-than-normal winter in much of the West, as a blocking high-pressure ridge could set up off the California coast and potentially worsen an already developing drought, forecasters say. The National Oceanic and Atmospheric Administration’s winter forecast favors warmer, drier conditions across the southern tier of the U.S. and cooler, wetter conditions in the north. This is due largely to La Nina, in which slightly below-normal sea surface temperatures lead to a high-pressure ridge that moves the storm track to the north.
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AG & FARMING
By SoCal Hemp, 11/10/20
SoCal Hemp JV LLC (“SoCal Hemp”), a joint venture of Cadiz Inc. and Glass House Group to farm, harvest, process and market sustainable hemp and hemp-derived products, announced the completion of its first commercial harvest of industrial hemp at the Cadiz Ranch in California’s Mojave Desert. The successful crop, planted on 240 acres in Spring 2020, produced more than 300,000 pounds of dried hemp biomass and hemp flower suitable for a variety of hemp and hemp-derived products. The harvested product is being transported to processors and assessed for product development, including hemp-derived cannabidiol (“CBD”) and other cannabinoid products.
By The Land Report, 10/14/20
The largest direct farm payments ever – to the tune of a record-smashing $37.2 billion – have bolstered farm sector income in 2020. While seeking to soften the impact of the pandemic throughout the ag sector, the Trump Administration directed the USDA to allocate federal payments that should equal 36 percent of net farm income for the year. Economists project overall annual income to hit $102.7 billion, representing a 23 percent hike. Meanwhile, net farm income could increase to $18.3 billion, up 21.7 percent from 2019. The USDA plans to revise its income projections on December 2.
By Food Safety News, 10/30/20
USDA’s National Agricultural Statistics Service (NASS) has released the results of the 2019 Organic Survey. It reports total sales of $9.93 billion in organic products, an increase of $2.37 billion, or 31 percent, from 2016. There were 16,585 certified organic farms, a 17 percent increase from 2016, which accounted for 5.5 million certified acres, an increase of 9 percent over 2016. California continued to lead the nation in certified organic sales with $3.60 billion, which is 36 percent of the U.S. total and four times that of any other state. California also led all states with 3,012 certified farms and 965,257 certified acres. Washington ($886 million), Pennsylvania ($742 million), Oregon ($454 million), and Texas ($424 million), round out the top five states for the value of organic sales.
By Hemp Industry Daily, 11/10/20
In a year of a deadly pandemic and a historic presidential election, it shouldn’t surprise anyone that anxiety levels are sky high among American consumers.But the silver lining for the hemp and CBD industry is that at least 20% of consumers are using more CBD products as a direct result of COVID, according to a June study by Chicago-based Aclara Research, a firm that analyzes cannabis and CBD consumers and works in collaboration with Nielsen Global Connect. The study results were highlighted in a Hemp Industry Daily report produced in collaboration with Nielsen, “How to Navigate the Complicated World of CBD in Retail.” The study highlights how current and new consumers will develop a proactive health-care regimen to manage their mental health, including how these behaviors may continue post-pandemic.
By Forbes, 11/01/20
This analysis is misplaced, misguided, and based on a fundamental failure to understand what it takes to develop a new agricultural market, while ignoring the real progress in the hemp industry. This seems to be a case of “you ain't gonna learn what you don’t want to know.”
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SUSTAINABILITY & ENVIRONMENT
By San Diego Zoo Global, 11/1/20
A team of biologists—including members from the U.S. Geological Survey (USGS), Bajada Ecology, LLC and San Diego Zoo Global—released nearly 150 desert tortoises into the eastern Mojave Desert this month (October 2020), to support recovery of this iconic species. This conservation program was made possible by a large coalition of San Diego Zoo Global partners, including Edwards Air Force Base (EAFB), the U.S. Bureau of Land Management (BLM), Cadiz Inc. and the Living Desert Zoo and Gardens, with funding from the California Energy Commission, the U.S. Fish and Wildlife Service and the Favrot Fund. The tortoises were reared at purpose-built facilities at EAFB and Cadiz Inc.,and some of the eggs were incubated and hatched at the Living Desert.
By Agri-Pulse, 11/9/20
The alfalfa, oats, radish and clover sprouting in Lance Lillibridge’s Iowa corn field this fall will improve his soil, prevent pollutants from running off his fields into local streams — and, according to scientists, help reduce the greenhouse gas emissions that are changing the climate. These cover crops, which can also reduce air emissions from nitrogen fertilizer, a major agricultural contributor to greenhouse gas emissions, also are earning him $35 to $50 an acre in extra cash. That’s a meaningful source of income during a period when farmers can barely cover their cost of producing corn and soybeans. Lillibridge is taking part in a project, co-sponsored by agribusiness giant Cargill Inc., that is testing whether corporate titans of the grocery, food, beverage, restaurant and apparel industries can persuade farmers to meaningfully reduce the environmental footprint of the crops they grow and animals and they produce. Officials with many corporations, including such names as Walmart, McDonald’s, General Mills, Levi Strauss and Co. and Danone, have in some cases made sweeping sustainability pledges to consumers and investors to slash the carbon emissions in their supply chains and meet corporate sustainability targets.
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POLITICS
By Cal Matters, 11-7-20
Goodbye, state of resistance. Hello, state of influence. California’s status has shifted dramatically with the election of Joe Biden as the next president. The reasons are both political — deep blue California will have more inroads to a White House controlled by Democrats — and personal: For just the second time in American history, a Californian will serve as vice president. Kamala Harris — California’s junior senator and former state attorney general — made history this week when American voters chose Biden to replace Republican President Donald Trump. She’ll become the first vice president who is a woman, a woman of color and a California Democrat. It’s a significant boost for a state that in recent years has held a high profile in Congress, but little sway at the White House. Congressional leaders from both parties, Democratic House Speaker Nancy Pelosi and GOP Minority Leader Kevin McCarthy, hail from the Golden State. But the last Californian president was Ronald Reagan more than 30 years ago. And the last Californian vice president was Richard Nixon — 60 years ago.
By San Diego Union Tribune, 11/12/20
Election Day is over, but California already is consumed with its next high-profile political contest — the competition to fill Kamala Harris’ soon-to-be-vacant U.S. Senate seat. In this race, only one vote matters, because there is only one vote. The selection falls to Democratic Gov. Gavin Newsom, who is being pressured by rival interest groups, fellow Democrats and even friends intent on swaying his decision. Harris will be sworn in as President-elect Joe Biden’s vice president on Jan. 20, and it’s not yet clear how soon before then she will give up her seat. Newsom has said he has no timeline to make an announcement.
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Cadiz Inc.
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