The Yaqui Valley in 2020

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• The Yaqui Valley in 2020
• An Uncertain Outlook
• Walter P. Falcon

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Past as Prologue

• The problem with history is that it is just one
  damned thing after another.
• George Bernard Shaw

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A Decade of Shocks

• Economic
• Peso Crisis 1994
• Removal of many subsidies and tariffs in
  conjuction with NAFTA
• Depressed world commodity prices, 1996-2001

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Shocks

• Biological
• White Flies-----gtSoybeans
• Karnal Bunt-----gtWheat
• Rusts-----gtWheat

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Summer Crops
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Shocks

• Climate
• Drought--a severely negative factor for all of
  Valley agriculture
• Cooler temperatures--a positive factor, at least
  with respect to wheat yields

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Logo for the Valley
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Irrigation--The Central Question

• How does the Valley get started again with an
  empty reservoir?
• Will new water conservation techniques and types
  of investments (such as pivot and drip) be
  needed?
• Will higher valued crops then be necessary to pay
  for the new irrigation investments?
• Will new forms of irrigation substantially reduce
  non point source nitrogen runoff/pollution?

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One Vision--Opportunities and Problems

• More use of Groundwater
• More higher valued crops, which means moving to
  demand-driven, forward contract systems
• More livestock and aquaculture production
• More point source pollution, more pesticide
  residues, less nitrogen non-point source runoff.

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Whither Cereals in the Valley?

• Can Mexican wheat be competitive internationally?
• Are new high-yielding wheat cultivars possible
  which use much less irrigation water?
• Is higher-yielding maize a near-term prospect?
• Is replacement of wheat with triticale a logical
  move to avoid wheat pricing problems and to feed
  the livestock industry?

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Profitability
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Government Support

• Mexico
• (Total Agriculture)
• Producer Support
• (2002)
• 8,080 mil.
• PSE--22
• General Services Support
• 0.710 mil.

• United States
• (Total Agriculture)
• Producer Support (2002)
• 39,559 mil.
• PSE--18
• General Services Support
• 26,594 mil.

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Types of Support in Mexico
Producer Support Payments Market price
support--66 Acreage payments--21 Income
support--2 Input subsidies--8 Other--3
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Government Support

• United States (2002)
• Wheat Prod.--44.1 mmt
• Government Support
• 2,611 mil.
• Wheat PSE--30
• Maize Prod.--228.8 mmt
• Government Support
• 4,578 mil.
• Maize PSE--17

• Mexico (2002)
• Wheat Prod.--3.2 mmt
• Government Support
• 0.202 mil.
• Wheat PSE--34
• Maize Prod.--19.3 mmt
• Government Support
• 1,081 mil.
• Maize PSE--31

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Major Uncertainties Lie Ahead

• What does the future hold with respect to
• Water availability and irrigation design?
• Bulk versus high valued commodities?
• Crop versus livestock/aquaculture as the
  dominant systems?
• Extent and types of Government support
• Political/economic concern for the ejiditarios?

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The Valley in 2020?