Saudi Arabia Is Buying Up Water Supplies In States Hit Hard By Drought


Saudi Arabia-based Almarai, one of the world's largest food production companies, owns 15,000 acres in the U.S.

Alfalfa is a staple crop in Saudi Arabia, but growing the grain is cost prohibitive and was formally banned in 2016, due to its water-intensive nature and dwindling water resources of the country’s mostly-desert landscape.

In light of this situation, Saudi Arabia-based Almarai — which is one of the world’s largest food production companies — was forced to travel the globe in search of cheaper water and land for growing alfalfa. Since 2014, Almarai subsidiary Fondomonte Farms has purchased 15,000 acres of farmland in the U.S. — or 16 percent of the irrigated valley between Arizona and California — The Guardian reported last year.

  • What makes the area so attractive to growers is the benefit of a deal struck clear back in the 1800s by a British gold rush-era prospector named Thomas Blythe — a deal still in place today that allows those in the desert adjacent to the Colorado river “unquantified water rights for beneficial use.”
  • That 1877 deal allows the water to be used for free.
  • The rights are now owned by the Palo Verde Irrigation District, which is not allowed to sell the water and only charge enough to cover its overhead, which The Guardian said comes to $77 per acre — “an astonishingly low rate” — regardless of how much water is used.

But today’s water supply and demand are not the same as they were in 1877, thanks to sprawling cities and suburbs, agriculture, the global supply chain and climate change. Now, the Colorado river is at a record low but demand has only grown and there is nothing in place to curb the use of its limited resource.

Some were outraged when the Saudi Arabian company waltzed into the small town of Blythe, California, and began buying up land, only to subsidize its own water deficiency across the ocean and export the fruit of America’s water for its own use.

  • The Guardian noted that Gizmodo ran a headline in 2015 reading, “Saudi Arabia is Outsourcing its Drought to California.”
  • But Dan Putnam, an alfalfa expert and UC Davis professor, believes the outrage is unwarranted. He noted in remarks to The Guardian that only 4 percent of alfalfa crops grown in the U.S. are exported, which is small beans compared to others, such as water-intensive almonds, of which 70 percent are shipped overseas.

As water supplies dry up in certain areas of the world, companies and governments increasingly will turn to resources found elsewhere to meet their needs.“For the survival of that country,” Putnam said of Saudi Arabia, “they will look to other parts of the world.”

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