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Reducing uncertainty on the Southern High Plains

F

arming practices on the Southern High Plains, and more specifically a farmer’s choice of whether or not to change them, are affected by irrigation methods and crop insurance.

Dr. Darren Hudson of the Department of Agricultural and Applied Economics is the graduate director and helps put together funding for research.

Dr. Hudson said, “We have students from all over doing research that impacts this area.”

Jorge Romero-Habeych is not your traditional student, he served in the Army and worked as an analyst in the natural gas industry before returning to school. He received his bachelor’s and master’s degrees in economics from the University of Central Florida. As a doctoral student in Agricultural and Applied Economics, Romero-Habeych’s research explores how farmers choose irrigation techniques.

Agriculture on the Southern High Plains was significantly impacted by the introduction of center pivot irrigation.

 “Prior to the center pivot in the 1990s, … irrigation was very inefficient,” Romero-Habeych said.

By adopting center pivots farmers were able to sustain yields while using less water.

In recent years farmers have had the option of adopting an even more efficient alternative, subsurface drip irrigation. Adopting efficient irrigation techniques along with the right kind of crop insurance is essential for farmers to reduce their exposure to risk.

“Why is it that we don’t see a wider implementation of this technology in the area?” Romero-Habeych asked. “My theory is that crop insurance in conjunction with already existing irrigation techniques might be making drip irrigation less attractive,” Romero-Habeych said. “On the margin, adopting drip is relatively expensive and the benefit in terms of risk reduction is likely not worth the cost.”

In terms of water use, wider adoption of drip irrigation by farmers on the Southern High Plains does not necessarily translate to less pressure on the Ogallala aquifer. Romero-Habeych made an interesting point on the issue.

“Past experience with the center pivot shows that its adoption led to more water use. Farmers actually started using more water than before because they started planting in fields that had previously not been economically attractive,” Romero-Habeych said.

Using the most efficient farming practices possible is vital for all farmer’s to continue production and not give up yields.

“Perhaps drip irrigation would be more widely adopted in the area if existing crop insurance choices were not made available. The combination of current insurance and irrigation options to reduce risk exposure might be crowding out drip,” Romero-Habeych said. “However, that might be a good outcome for the aquifer.”

How farmers on the Southern High Plains are affected by government policies, along with understanding how they use the tools at their disposal to reduce uncertainty, is what drives Romero-Habeych’s research.

New Trade and Immigration Policies Will Impact Ag

Immigrant workers in a field. Photo courtesy of Gus Ruelas/Reuters with The Daily Beast
Immigrant workers in a field. Photo courtesy of Gus Ruelas/Reuters with The Daily Beast

Over the course of the 2017 presidential campaign, Donald Trump proposed numerous policies to be implemented once becoming president. Now in office, President Trump’s immigration and trade policies specifically could affect more than just immigrants and tariffs.

The agricultural industry is indirectly tied to both topics, which could negatively impact production and trade with the policies’ implementation. Immigrants, both legal and illegal, play a significant role in the agricultural industry. According to AgWeb, the Department of Labor estimates 53 percent of the 2.5 million workers in the U.S. are illegal immigrants.

Darren Hudson, Ph.D., professor and Larry Combest Endowed Chair for Agricultural Competitiveness in the Department of Agricultural and Applied Economics at Texas Tech, said there are indirect effects to supply from the proposed policies because fewer immigrants mean less production, which increases costs.

“I think when you talk about pure immigration, agriculture uses a lot of migrant labor, especially in fruits and vegetables, but in other ag production sectors as well,” said Hudson, who is also the director of International Center for Agricultural Competitiveness. “Any disruption in labor availability obviously is going to rein costs for producers. This is often framed in terms of illegal immigration, but the reality is, legal immigration is stymied as well.”

Benjamin Powell, Ph.D., director and professor of economics in the Free Market Institute at Texas Tech, said Trump has misrepresented problems associated with immigration, and they increase native citizens’ income.

“The overwhelming majority of these 11 million people are making Americans wealthier,” Powell said.

Hudson said legal and illegal immigrants are a net-positive to society. He mentioned although they are in the U.S. illegally, they have fake social security numbers playing into the system. Through that, they are subsidizing U.S. citizens by not having social security benefits through the tax money they pay.

With Mexico being the U.S.’s fourth largest trading partner, new trade policies would negatively impact agriculture.

“A 20 percent tariff on Mexican imports would have a direct impact mainly because they’re likely to put retaliatory tariffs on it,” Hudson said. “So on the one side, products coming into the U.S. will be more expensive for U.S. consumers, so it’s going to adversely affect us and products going out if they put these tariffs on there.”

The concern for farmers and ranchers in the U.S. is the impact a tariff could have on them locally. Hudson said Texas agriculture is more likely to be affected because agricultural products are one of the largest shipments to Mexico.

On a local scale, Lubbock could be impacted since most of the agricultural products are exported to Mexico.

Hudson said the largest industries impacted by trade disruptions would be livestock because of the movement of livestock products back and forth across the border.

“You can have tariffs without changing immigration policy, and you can change the immigration policy without having tariffs,” Hudson said. “Both of them will have some impact on agriculture. Put them together, and it’s a big impact.”

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