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Between 2009 and early 2011, water supplies were abundant, so the watermaster was able to provide full allocations (4 AF/acre), and during flood operations at the Falcon and Amistad Dams, the Rio Grande Watermaster provided “free water” that does not count against contractor’s accounts. As a result, leasing activity for irrigation water was sparse during that time.
But with a change in hydrology, activity peaked in the fourth quarter 2012, totaling 51,183 AF for just that quarter. Since then, activity eased somewhat, but has remained high—rivaling or exceeding the amount of activity seen during the drought of the late 1990’s. During the fourth quarter 2014, leases totaled 21,557 AF—compared to 17,021 AF in the fourth quarter 2013; 51,183 AF in the fourth quarter 2012 and 9,874 AF in the fourth quarter 2011.
Prices also increased. They ranged from around $20/AF to $25/AF when activity was low and increased to range from approximately $30/AF to $35/AF. There were two price spikes of $38.67/AF in the fourth quarter 2013 and $44.07 in the third quarter 2014. In the fourth quarter 2014, prices were at $31.37/AF.
With drought continuing to plague the region and Mexico amassing a water debt under the Rio Grande Compact, expect activity and prices to stay high. (For more on Mexico’s failure to satisfy its obligation to provide an average of 350,000 AF per year over five-year cycles, along with discussion of a potential solution, see “Texas Laments Unreliable Water Deliveries from Mexico,” Rodney T. Smith, Hydrowonk Blog, February 11, 2015.)
Written by Marta L. Weismann
Editor’s note: the last version of this chart, which was presented in Water Strategist November 2010 and reprinted in the WS 2011 Special Issue, has been updated to reflect revisions to the data provided by TCEQ.