By Levi Crews

Levi Crews

It’s an all-too-familiar headline: “In the midst of drought, California farmers used more water for almonds.” Almonds are one of the most water-intensive crops we grow—it takes more than a gallon of water to produce a single nut. And yet California, one of the driest agricultural regions in the country, now produces about 80% of the world’s almonds, much of it for export. This boom has coincided with a stretch of deepening droughts, land subsidence, and groundwater overdraft across the Central Valley. That raises a natural question: Is international trade draining California’s water?

In a new paper “Agriculture, Trade, and Global Water Use” with Tamma Carleton (UC Berkeley) and Ishan Nath (Harvard Kennedy School), Professor Levi Crews studies this question on a global scale. He and his coauthors combine recent advances in hydrological measurement from NASA’s Gravity Recovery and Climate Experiment (GRACE) with agricultural and economic data to inform a dynamic, high-resolution model of agricultural production, trade, and water use. The goal: to understand how trade in agricultural commodities affects long-run water availability and agricultural productivity the world over.

The answer, it turns out, suggests that California and its almonds are the exception, not the rule.

Globally, water-intensive agriculture overwhelmingly takes place in water-abundant regions. This is true even though most farmers around the world use water as an open-access resource, with no market prices or tradable rights (another way that California and its Sustainable Groundwater Management Act are the exception). The data show that farms in the wettest parts of the world use nearly nine times more water per acre than those in the driest. That pattern is both surprising and encouraging: it suggests that nature—through annual endowments of rainfall and the physical costs of reaching deep water tables—does much of the work of rationing water use, even without formal markets.

Against this backdrop, trade tends to reduce water stress globally. When the authors simulate a world without trade in agricultural commodities, global water consumption rises by 60% and water tables fall sharply—especially in dry, food-importing countries. Food prices also skyrocket, increasing fourteen-fold in some places. Why? Trade allows countries to specialize according to their natural resource endowments, effectively exporting crops from wet to dry places and preserving global water stocks. Without it, everyone needs to grow their own almonds.

But California’s Central Valley is one of the rare exceptions: in the simulation without trade, the rate of groundwater depletion there slows. Without access to global markets, local farmers scale back on water-intensive crops, easing pressure on aquifers. But these reversals are confined to a small number of already overdrawn exporters; for most of the world, trade is what prevents depletion in the first place.

Additional simulations add more nuance. The Uruguay Round of WTO negotiations—the largest agricultural liberalization to date—shifted production toward several dry, water-scarce countries and modestly increased global depletion. Even when trade improves efficiency overall, then, specific reforms can push in the wrong direction.

California’s Central Valley stands out as a rare case where agricultural trade, combined with high water-intensity, has put mounting pressure on local resources. But zooming out to the global picture reveals a more optimistic story: trade, when well-aligned with natural resource endowments, is a big part of the solution.

The paper can be found here: https://www.levicrews.com/files/p-wateruse_paper.pdf