Ag land values, especially almond and pistachio land has plummeted in the past year, Central Valley appraisers say, according to a Wednesday article from AgAlert.

In the past eight months, the value of vineyards and tree nut orchards in the San Joaquin Valley has declined 25% to 50%, according to analysis from Gatzman Appraisal in Stanislaus County.

Some almond orchards without reliable surface water have dropped by more than half, and some Tulare County pistachio orchards sold for a quarter of what they were worth last year, the article states.

But even low crop prices, rising input costs, and high interest rates faced by the industry don’t explain the freefall seen this year, experts say.

As the state’s landmark Sustainable Groundwater Management Act comes into effect, a divergence grows between the value of land with access to surface water and that which is reliant on well water.

“We continue to see this divergence between the values of properties that have multiple sources of water and properties that are reliant on wells only,” Janie Gatzman of Gatzman Appraisal said. “That is SGMA’s influence.”

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Farmers Threatened By Pumping Restrictions

After 2020, groundwater agencies had to have their plans outlining water usage approved. They also had to avoid further depletion, subsidence, and water quality degradation.

Critically overdrafted groundwater basins have until 2040 to achieve sustainability.

But even with the deadline 16 years away, farmers say pumping restrictions threaten the viability of their farms.

Banks have now become reluctant to finance farms facing massive declines.

“Everyone’s equity base has decreased, and it’s costing a lot more to farm,” said Michael Naito, former president of the Madera County Farm Bureau. “There comes a point where you can’t do it anymore.”

Read more at AgAlert.

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