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10 CapitalPress.com Friday, August 30, 2019 Irrigation: ‘You can’t force people to irrigate more to provide runoff’ Continued from Page 1 point,” said Mike Britton, manager of the North Unit Irrigation District, which provides water to nearly 59,000 acres in the region. Unintended consequences Open canals in more remote areas are unlikely to encounter such aesthetically based objections to piping, but projects aimed at irriga- tion efficiency may nonethe- less have unintended conse- quences for other irrigators and river hydrology. In the Deschutes River Basin, irrigation overhauls are not only being driven by efficiency but also by regula- tory necessity. Winter flows that are stored in a reservoir by the North Unit Irrigation Dis- trict are being released to improve habitat for the Ore- gon spotted frog, which is protected under the federal Endangered Species Act. Those irrigators will instead rely on summer flows from water conserved by piping canals in the Central Oregon Irrigation District. “The canals people have enjoyed walking along are going to change because they have to,” said Horrell, COID’s managing director. Transformative change For the Powder Val- ley Water Control District in Eastern Oregon, invest- ments in piping and res- ervoir development made more than four decades ago have proven transformative for individual irrigators. Water delivered through pipelines is pressurized, so growers could switch from flood irrigation to center piv- ots and wheel lines without spending money on electric- ity for pumps. The system has also allowed farmers to irrigate more land — about one-third of the district’s 15,000 irrigated acres grew drylands crops before the development of reservoirs and piped canals. “We conserve a whole lot of water and we can irri- gate additional acres with the gravity pressure also,” said Lyle Umpleby, the dis- trict’s manager. “We’ve increased the crop produc- tion immensely.” Aside from agronomic considerations, the pressur- ized pipes may someday be outfitted with hydroelectric turbines to generate renew- able power. To an extent, invest- Photos by Mateusz Perkowski/Capital Press Wes Morgan, manager of the Burnt River Irrigation District, stands next to the Unity reservoir from which downstream irrigators draw their water. ments in efficiency made by individual irrigators were prompted by the altered flow of water across the district. When most of the acre- age was fed by open canals that farmers used to flood irrigate their fields, excess water traveled from one property to another. As some growers moved away from flood irriga- tion, however, their down- hill neighbors could no lon- ger count on those flows and had to tap into the pipelines themselves. “When you switch to sprinklers, you don’t get that return flow,” Umpleby said. Within irrigation dis- tricts, conflicts over water between individual growers can be defused or resolved equitably because the sys- tem is managed as a whole. Impacting neighbors In the Eagle Point Irriga- tion District, which deliv- ers water to more than 8,000 acres in southwest Oregon, a planned change in irri- gation practices requires a $1,250 fee plus charges for staff time, which pays for a review that’s intended to prevent harm to other patrons from modified water flows. “The district has more control over what individu- als are doing within the dis- trict,” said Sarah Liljefelt, an attorney specializing in water law. When irrigation practices are changed outside a district, however, growers are directly subject to the “prior appro- priations” system of Western water law under which junior users may lose the ability to irrigate so that flows to senior users with older water rights are preserved. Under this doctrine, a senior water right holder may request that state water regu- lators shut down irrigation by a junior user. An open canal within the Powder Valley Water Control District. Some of the district’s main canals were replaced with pipe in conjunction with a reservoir project. Lyle Umpleby, manager of the Powder Valley Water Control District in Eastern Oregon, stands next to water flowing into an open canal from an irrigation pipe. Also, if a farmer invests in sprinklers or other effi- cient technology and stops flood irrigating, it’s possi- ble to re-allocate much of that saved water to addi- tional acreage — potentially reducing return flows to a river. Senior users can then issue a “call” to protect their access to water, but it may or may not be the irrigator who invested in efficiency who ends up “regulated off.” “It’s not a direct correla- tion to a specific water user who has made changes,” Lil- jefelt said, adding that shut- offs are decided based on the priority date of water rights. “The water master won’t pick and chose.” Farmers who have water rights in reservoirs or chan- nels that depend on runoff can also encounter difficul- ties when uphill neighbors invest in more efficient irri- gation methods. “If that runoff stops, they’re kind of out of luck from a water rights perspec- tive,” Liljefelt said. “You can’t force people to irrigate more to provide runoff, or to irrigate differently to provide runoff.” A similar dynamic can occur if an irrigator who draws groundwater from a deep, confined aqui- fer shifts to a more effi- Trade: Japan is the largest value destination for U.S. pork, beef exports Continued from Page 1 Japan is also a partner with which the U.S. industry hopes to build a growing ethanol market, he said. The American Soybean Associa- tion has repeatedly stressed the need to work hard on existing and new free trade agreements during the trade war with China, Davie Stephens, ASA president, said. “So we are definitely pleased to hear that the president and his team have heard ASA and other farm groups by working on this deal,” he said. Groups representing animal agri- culture also weighed in. Japan is the largest value destina- tion for U.S. pork and beef exports, according to U.S. Meat Export Federation. Dan Ahlstrom, USMEF president and CEO, said the agreement is “tre- mendous” news for U.S. farmers and ranchers and everyone in the red meat supply chain because it will level the playing field in the world’s most com- petitive red meat import market. “It is also a very positive develop- ment for our customer base in Japan, which USMEF and our industry part- ners have spent decades building,” he said. The Japanese market represented 25% of U.S. pork exports in 2018, and U.S. pork is a preference among many Japanese customers, according to the National Pork Producers Council. “We look forward to rapid imple- mentation of the agreement as inter- national competitors are currently tak- ing U.S. pork market share through more favorable access,” David Her- ring, NPPC president, said. The National Cattlemen’s Beef Association sees the agree- ment as another victory for the U.S. beef industry. “Removing the massive 38.5% tar- iff on U.S. beef will level the playing field in Japan, and we are very thank- ful to President Trump and his trade team for continuing to fight on behalf of America’s ranching families,” Jen- nifer Houston, NCBA president, said. The National Association of State Departments of Agriculture said U.S. farmers and ranchers needed a win and the preliminary agreement comes at a critical time. “With major competitors eyeing our market share in Japan, expand- ing access for U.S. producers is crit- ical,” Barbara P. Glenn, CEO of NASDA, said. U.S. Wheat Associates and National Association of Wheat Growers said in a joint statement an agreement would keep U.S. wheat flowing to a very large and crucial market for U.S. farmers “We are very happy that this agreement will end the growing com- petitive cost advantage that Canadian and Australian wheat imports got under the Comprehensive and Pro- gressive Trans-Pacific Partnership (CPTPP) agreement,” Doug Goings, USW chairman, said. Locked out of that agreement, U.S. wheat imports would have become less and less competitive to the point that Japan’s flour millers would have no other choice than to buy lower cost wheat from the CPTPP member countries such as Canada and Austra- lia, USW and NAWG said. The agreement is a much needed trade deal with Japan, Ben Scholz, NAWG president, said. “This is a huge win for those of us who grow wheat and all U.S. farmers and ranchers,” he said. cient method, such as drip or micro-irrigation. Less water will then flow into a nearby stream or river — potentially affecting sur- face water irrigators — even as the underground aqui- fer benefits from curtailed pumping. Conversely, piping canals and curtailing flood irriga- tion can reduce the infiltra- tion of water into aquifers in some areas, potentially drying up wells or forcing groundwater irrigators to dig deeper ones. “It’s really artificial recharge, because if those canals weren’t there, that recharge wouldn’t occur any- way,” said Britton, manager of NUID. Such unintended impacts have led some irrigators to believe government poli- cies in the past have been overly zealous in promoting the piping of canals and urg- ing farmers to abandon flood irrigation. Natural cycles Historical flood irrigation mimics natural cycles that benefit irrigators as well as the ecology of a watershed, said Fred Otley, a rancher in Diamond, Ore., who draws water from the Donner und Blitzen River system in East- ern Oregon. “When regulators and Craig Horrell, right, of the Central Oregon Irrigation District speaks with Mike Britton of the North Unit Irrigation District by a reservoir on the Deschutes River that serves as an intake for canals. policy makers say that’s the thing to do without looking at the whole picture, it can have a very negative impact,” Otley said. Flood irrigation serves a “capture, storage and release” function, as water can remain in the soil for three weeks to three months before re-enter- ing the stream, he said. That delayed water boosts stream flows during late summer, prolonging irriga- tion season while also cool- ing the water for fish and enabling the growth of ripar- ian plants for wildlife habitat, Otley said. “Water in this system is used over and over again,” he said. Without flood irrigation, water would travel down- stream during spring until collecting in an inland lake, and would eventually be lost to evaporation, he said. “It primarily happens due to well-intentioned policy.” Otley said he doesn’t oppose investments in irriga- tion efficiency as long as it’s supplementary to the more traditional method. “The move to sprin- klers can be fine as long as it doesn’t replace flood irriga- tion,” he said. In the Burnt River Irri- gation District that supplies water to about 20,000 acres in Eastern Oregon, irriga- tors rely on a mix of tradi- tional flood irrigation in low- land areas and sprinklers in upland areas. There’s more interest in investments in efficiency, including center pivots and wheel lines, above the dis- trict’s Unity Lake reservoir, where canals carry water to more distant fields, said Wes Morgan, the district’s manager. Below the reservoir, where flood irrigation is dominant, farmers are wary of piping and other changes that would jeopardize the return flows they rely upon, he said. “All the flood irrigation comes back to the river,” Morgan said. Ultimately, though, major disruptions to the district’s irrigation system are unlikely due to the region’s agricul- tural economy. The soil and climate are most suitable for rais- ing hay that’s fed to cattle, rather than more valuable crops that would warrant replacing open canals and buying expensive irrigation equipment. “You just couldn’t put a pencil to it and justify a pipe,” Morgan said. “It’s tough to make money put- ting hay through a cow.” NORPAC: Company contracts with 220 growers across more than 40,000 acres in region Continued from Page 1 in Stayton, Ore., though Tiegs doesn’t plan to keep it operating. Tiegs said he can move equip- ment from the Stayton facility to other plants and use surround- ing farmland to plant berries. His longer-term plans for the prop- erty will depend on environmental evaluations of it. As a farmer with more than 100,000 acres under cultivation, Tiegs said he’s looking forward to working with the cooperative’s members to turn the business around. “I wouldn’t be doing it if I didn’t think it would work fine,” he said. More than 140 farmer mem- bers own the NORPAC coopera- tive, which was founded in 1924 and is the biggest frozen fruit and vegetable manufacturer in the Northwest with about $310 mil- lion in annual sales. The company contracts with 220 growers across more than 40,000 acres in the region and has about 1,125 full-time employ- ees and 1,100 seasonal employees during peak harvest season. Shawn Campbell, NORPAC CEO, said the co-op was pleased to find a partner who “shares our vision and will ensure the best possible future for our grow- ers, employees, customers and partners.” “Our business operations will continue as normal through the bankruptcy process,” Campbell said in a statement. “Our 2,700 employees will continue to receive their wages and benefits, our ven- dors and suppliers will be paid in the ordinary course of business going forward, and our custom- ers can continue to rely on us for unparalleled produce and products thanks to our family of farmers.” Dave Dillon, president of the Oregon Farm Bureau, said bank- ruptcy filing will have a “profound impact” on co-op members. “In the immediate term, getting paid for delivered or contracted crops is a huge concern,” Dillon said. “In the near-term future, the potential write-down of growers’ retained earnings could drastically change farm balance sheets and affect operating loans. Dillon said NORPAC has been a vital marketing tool for Oregon producers for decades. “If we don’t have a viable co-op, it will drastically change the ag landscape in Oregon,” he said. “Oregon Farm Bureau is greatly concerned with the well-being of our member families. We are mar- shaling resources we hope can be helpful to those affected by this bankruptcy.” In a traditional, patron- age-based farm cooperative, growers receive part of their pay- ment for crops and the rest as “retained earnings,” which act as their equity or ownership in the company, said Robin Cross, an economics professor at Oregon State University who has stud- ied co-ops. However, Cross said he’s unsure whether NORPAC has retained this traditional model or modernized it in recent years. When assets are sold in bank- ruptcy, the money is first used to repay secured creditors who have collateral for loans, then unse- cured creditors according to their level of priority, said Andrea Coles-Bjerre, a University of Ore- gon law professor specializing in bankruptcy. Equity owners are the lowest priority for distribution of pro- ceeds, if any are left after creditors are paid, she said. According to bankruptcy doc- uments, Oregon Potato Co. is expected to “pay all amounts due to growers for the 2019 crop” and NORPAC believes the sale “will generate funds sufficient to pay all secured and priority claims and leave sufficient funds for a mean- ingful distribution to unsecured creditors.” NORPAC owes between $100 million and $500 million to between 5,000 to 10,000 creditors and owns assets of $100 million to $500 million, according to its bankruptcy petition. NORPAC hired a financial advisory company in May 2018 to explore its “financial and strategic alternatives, including purchase, merger, consolidation, reorganiza- tion, or other transaction of a like nature,” according to a bankruptcy document. That financial adviser contacted 166 potential inves- tors, which generated four letters of interest and led to “extensive negotiations” with a “highly qual- ified and motivated party” that ultimately fell through in June, the document said. In June, NORPAC hired a restructuring company that assisted in “almost six weeks of negotiation” that concluded with the asset purchase and sale agreement with Oregon Potato Co., according to bankruptcy documents.
