Irrigation adds $250 million a year in value to crops grown in southern Alberta, according to a University of Lethbridge study.
Economics professor Kurt Klein and colleagues examined the value of agricultural irrigation after they found a lack of research on the topic, he told the Alberta Irrigation Projects Association meeting Nov. 29.
Researchers looked at crop production in the four major sub-basins of southern Alberta, the Oldman, Bow, Red Deer and South Saskatchewan, where roughly 80 percent of irrigated crops are grown.
They used data for 16 major crops grown under irrigation and calculated gross margins by multiplying price by yield and subtracting variable costs.
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Fixed costs were not included in the calculations.
These figures were compiled for a five-year period, from 2004-08, and presented in 2008 dollars.
Klein compared those figures to others that were based on the assumption that dryland farming was done on the same land.
He made that assumption by looking at cropping patterns on existing dryland acres and assuming the same pattern would have been applied. His team based its calculations on seven major dryland crops.
“This is our estimate of what would have been, had there been no irrigation,” Klein said.
Gross margins were relatively stable on irrigated land, partly because yields were more stable.
“We found, at least in this study, that incremental gross margins from irrigated crops tend to be quite stable over the years despite large annual changes in farm output and input prices.”
———
(1)
2004 $296
2005
2006
2007
2008
294
264
264
336
(2)
$56
23
17
46
92
incremental (3)
$240
271
247
218
244
