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Facing drought, Western states seek to deny groundwater to foreign companies

A land deal approved by Arizona officials years ago has sparked turmoil in the state amid growing fears of a drought. Fondmonte, a subsidiary of Saudi dairy giant Almaray, has acquired approximately 10,000 acres of land from the province at well below market prices. The company didn’t have to buy an unlimited amount of pumped groundwater, just the land above it. (Facebook)

(Tribune News Service) — Just off a dry highway in western Arizona, a Saudi dairy company pumps unlimited groundwater from beneath its fields and uses it to grow thousands of acres of alfalfa and produce hay. We ship bales overseas to feed cattle. Over 8,000 miles away.

Arizona authorities now want to stop them.

As the western United States battles the worst drought in more than 1,200 years, elected state officials across the region are rethinking how groundwater is used and who has access to it.

Republican and Democratic lawmakers in Arizona, California, Texas, Utah and Washington aimed to protect the state’s water supply by banning foreign companies from owning or leasing land. Elsewhere in the U.S., after the recent spy balloon incident, state legislators decided against foreign companies, especially Chinese ones, owning land, largely for national security reasons. rushing to ban

In Arizona, a Republican-backed bill seeking to ban companies from China, Cuba, Iran, North Korea, Russia, Saudi Arabia, Syria and Venezuela from leasing or owning land won the state vote with some Democrats. passed parliament. The state Senate is currently considering the bill.

At a hearing last month before the House Land, Agriculture and Rural Committee, Republican Rep. bill,” he said.

“We want to make sure the water is pumped and not used for reasons that don’t benefit us at all.” It’s gone. That’s the goal. We want to stop it completely.”

Democratic state Rep. Mariana Sandoval, who voted against the bill on both the committee and the House, said she agreed with the spirit of the bill, but questioned whether it would actually protect water. The law would not affect existing leases or ownership, but Sandoval sees it as a major omission.

“I don’t think anyone wants an out-of-state organization to pump groundwater, even if it’s an American organization.” It’s missing, it doesn’t address the real problem that groundwater supplies are being exploited by entities.”

The law does not cover the United Arab Emirates, but one of its companies, Aldara, also grows alfalfa in Arizona and ships it abroad.

An effort to ban members of the “Chinese Communist Party” from owning land in Arizona passed a state Senate committee last year but failed to reach a vote in the floor. According to the National Agricultural Law Center, 14 states restrict foreign ownership of agricultural land.

The need to conserve water is dire, but some water and agriculture experts told Stateline that the problems facing the West are less about owning land and overpumping wells. , says it is in need of broader changes in groundwater management. These experts also expressed concern that the bill would step into dangerous nationalism.

Rhett Larson, a professor of water law at Arizona State University, said he wasn’t sure how a law prohibiting foreign companies from owning agricultural land would help conserve groundwater.

“If you’re really worried about groundwater, you should pass a law to manage groundwater,” he said.

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In 2014, Fondomonte, a subsidiary of Saudi dairy giant Almarai, took over the lease of an existing alfalfa farm and spent about $50 million to build powerful wells and upgrade the irrigation system.

There is virtually no regulation or oversight of groundwater abstraction as the land is outside of active management zones.

Fondmonte acquired approximately 10,000 acres of land from the state at $25 per acre, well below market value. The company didn’t have to buy an unlimited amount of pumped groundwater, just the land above it. The deal subsequently caused an uproar in the state.

Democratic Attorney General Chris Mays, who was just elected in November, called it a “sweet deal” and is investigating a deal he called “Saudi water grabs” during the campaign.

Richie Taylor, Director of Communications at Mayes, said: “We can’t afford to do that anymore.”

He declined to specify what actions Mays might take, but said the historical lack of water regulation needs to be looked at more closely. He added that Mays has not taken a position on bills passing through the state legislature.

The Rose Law Group, which represents Fondmonte Arizona, did not respond to a request for comment in time for publication.

The company also grows alfalfa in the Palo Verde Valley of Southern California, where water rights are stronger than in the metropolitan areas around Los Angeles and San Diego.

Last year, the California legislature unanimously passed a bill banning foreign governments from buying or leasing agricultural land in the state. But Democratic Gov. Gavin Newsom vetoed the bill, writing that the action was beyond the powers of the State Department and would create “new and difficult responsibilities.”

In Arizona, years of state inaction have frustrated residents living in communities where foreign-owned farms operate, including La Paz County Superintendent Holly Irwin.

The deal the country has given to Saudis is hurting communities, she said. She claimed that the company was abusing the state’s water supply.

“We have a big problem with foreign companies pumping our water and depleting our natural resources,” said Irwin, a Republican. “Whether you’re Saudi or Chinese, that’s a problem. If you don’t change something, you won’t get water.”

Concerns about nationalism

Natalie Koch, a professor of political geography at Syracuse University and author of the book Arid Empire: The Entangled Fates of Arizona and Arabia, said Saudis had a long history of agriculture in Arizona that led to the current situation. He said he was.

Before the country acquired land in the southwest, Saudi Arabia hosted a delegation of Arizona farmers sent by the US State Department in the 1940s to discuss agricultural practices. Around the same time, members of the Saudi royal family came to Arizona to inspect the agricultural industry.

In the 1970s, the Saudi government invested heavily in subsidies in an attempt to boost domestic dairy production, leading to unsustainable agricultural and water policies, Koch said. Decades later, Saudi Arabia has essentially depleted its aquifer.

The Saudi government, knowing that the country was running out of water, told domestic dairy companies that they were less likely to ban grain exports and would not be regularly disrupted by farmers’ protests, giving them an advantage, including in Argentina. encouraged the purchase and lease of land in countries with strict water regulations.Romania, Serbia, USA

“The United States has always facilitated and prepared for all of this,” Koch said. “It’s not that Americans are reluctant about this. We have definitely helped seed the Saudi agriculture that has now returned to us.”

According to Alida Cantor, an assistant professor of geography at Portland State University, foreign companies are operating within the American West’s agricultural system, which has long-standing problems with water management. Despite the region’s worst drought in 1,000 years, farmers are growing water-hungry crops, backed by decades-old water rights, she said. To do.

She also pointed to a Minnesota company that owns farmland in Arizona, pumps groundwater, grows alfalfa, and sends it back to the Midwest, yet faces minimal resistance. The debate over the use of depleted groundwater should not be entangled in “racist and nationalist” debates, she said.

“If the problem lies in exporting water-intensive crops grown in the desert, or in rethinking how water rights enable it, we need to have those conversations. I think there is,’ she said.

Concerns about foreign ownership are “understandable,” but not the most pressing issue for state water supplies. Mike Wade, executive director of the California Farm Water Coalition, says more water storage and infrastructure fixes are needed. The foreign ownership ban also ignores the role American agriculture plays in global markets, he added.

In fact, Alfalfa, which Fondomonte primarily grows in Arizona, is a “building block” of the state’s agricultural and food industries, said Phil Bashaw, chief executive of the Arizona Federation of Agriculture Departments. rice field. Agricultural exports are a “shining star” in foreign trade relations, he added.

“The fact that we are producing a viable, usable commodity that is needed for export is something we should be proud of,” he said. typically grows much more efficiently than anywhere else in the world.”

©2023 The Pew Charitable Trust.

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