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article imageU.S. water rights at stake as Saudis buy up land in California

By Karen Graham     Mar 28, 2016 in Business
Saudi Arabia's largest dairy company will soon not be able to grow alfalfa to feed its 170,000 cattle in its own parched country, so it is buying up more of California's drought-stricken land to grow alfalfa.
In January this year, the Almarai Company of Saudi Arabia bought $32 million worth of land in California's Palo Verde Valley, doubling its holdings there, and an additional 10,000 acres of farmland in Vicksburg, Arizona for $48 million, reported Digital Journal.
The two areas were carefully chosen by the Saudi company. Palo Verde farmers live in an area that is allowed "first dibs" on water from the Colorado River. And in Blythe, Arizona, there are fewer well-pumping restrictions than other parts of the state.
The 14,000-acre purchase allows Saudi Arabia to take advantage of farm-friendly U.S. water laws. But Fox News says the acquisition has also revived a debate over whether regulations and a number of questionable laws favor western farmers too much.
Alfalfa is a low-profit but water-intensive crop. So the question of reduced water restrictions for those growing this crop are thought of as being ludicrous when people in cities are being asked to reduce their water consumption by taking fewer showers and not washing their cars, reports the Associated Press.
John Szczepanski, the director of the U.S. Forage Export Council says, "It flies in the face of economic reason. You've taken on all of the risks a farmer has. The only way you can justify that is that they're really not trying to make a profit. They're trying to secure the food supply."
Saudi Arabia's need to conserve precious resources
For decades, Saudi Arabia has tried to grow its own water-intensive crops for food. But it had to reverse itself and start relying on farms overseas about eight years ago to conserve its dwindling water supplies. The Saudi government has gone even further, banning the planting of certain crops that use too much water.
In December of 2015, the Saudi government announced it would stop growing "green fodder," livestock feed derived from alfalfa, over the next three years. The announcement was also made by Almarai in a statement published on the Saudi stock exchange when they announced their acquisition of land in the U.S.
Almarai has acquired farmland worldwide to make sure that weather, transportation difficulties and other conditions don't interrupt the supply chain. Jordan Rose, an attorney for the company's Arizona unit says the U.S. was just a "natural progression" in diversifying Almarai's supplies. "The cows feed multiple times a day, and they need to be certain that they are always able to fulfill that unwavering demand," she wrote.
Saudi Arabia is not the only foreign country to own land in the U.S. Al Dahra ACX Global Inc. is a top U.S. hay exporter based in Bakersfield, California. It is owned by Al Dahra Agriculture Co. of United Arab Emirates. The company owns land in Arizona and California and packages crops for export at two plants in California and one in Washington state.
Of course, the foreign land acquisitions have met with both cheers and jeers. Farmers in Southern California say Almarai is a well-run company that has given an economic boost to the region. Others say the purchases highlight the questionable water policies now in place. So what does this mean for farmers who have less water restrictions, and should this issue be opened to debate?
More about Water rights, Saudi arabia, us water laws, almarai Company, Colorado river
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