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The value of natural capital

It’s hard to imagine that just one year ago, many areas of the province still had too much moisture.

True, some farmers, such as those along the Assiniboine River downstream of the Shellmouth Dam are still suffering from too much water. But the story for the rest of the province this year is all about the other “D” word: drought.

Until a week or so ago, it looked like the worsening situation sweeping across the U.S. would spare the Northern Great Plains. As of last week, more than half of all counties in the United States had been designated disaster areas by USDA, mainly due to drought.

With early-seeded crops in the bin in good shape and poised to cash in on the record prices, attention here has now turned to the crops still reaching maturity. It’s becoming apparent that even a good shot of rain won’t be enough to prevent yield losses for soybeans, corn and some of the other specialty, high-value crops farmers here were counting on.

With groundwater reserves becoming scarce in some areas and river levels dropping, even irrigation supplies are looking a little sketchy.

It’s unfortunate, but predictable. Scientists have been forecasting this kind of feast-to-famine moisture scenario in climate change models over the past decade. Those models, repeatedly scoffed at by doubters, have proven to be eerily accurate in identifying how the impacts of global warming would begin to impose on our lives.

Yet we continue to take the attitude, both in policy and in practice, that the only good water is water that’s headed downstream.

A recent study by Chad Lawley from the department of agribusiness and agricultural economics at the university of Manitoba, and Charles Towe, from the department of agricultural and resource economics at the University of Maryland, noted that conversion of wetlands and upland habitat persists despite the fact that more than half of wetlands in the Prairie pothole region of North America have been lost or degraded since European settlement.

“Of the 500,000 wetland acres (five per cent of total wetland area) lost in Western Canada between 1985 and 2001, it is estimated that more than 60 per cent were converted to cultivated crops,” they say.

The study also said provincial laws designed to slow the loss of wetlands are poorly enforced. “This combination of weak regulatory monitoring and enforcement and widespread landowner resistance to such regulation of private property without compensation has led to a positive environment for the use of conservation easements as an important tool for habitat conservation,” the authors say.

But even conservation agreements, voluntary easements some landowners place on their properties in exchange for compensation from the likes of Ducks Unlimited, Manitoba Habitat Heritage Corp. and Nature Conservancy Canada, have come under attack lately from municipalities who fear the restrictions will limit how that land might be developed in the future.

The two researchers looking at the effects of conservation easements on land values found these easements are actually a good deal for the landowner, as well as for society in general. Their research found that although the market value of parcels partially protected by these easements was lower, the easement payments more than made up the difference.

In fact, when all was said and done, the landowner was ahead to the tune of 25 per cent after agreeing to a permanent easement to protect vulnerable lands.

“We found that, on average, the parcels with easements sold for about $41 less per acre over the entire parcel than those without easements,” says Lawley. “However, easement payments more than made up the difference.”

Plus, the easements are doing an effective job at protecting habitat.

“We were also interested in finding out if conservation agencies were actually being successful in conserving habitat that would otherwise be at risk of being converted to cultivated acreage,” Lawley says. “If they were paying for easements on habitat that would not be at risk anyway because the cost of converting it to cultivation would outweigh the benefit, it would be a waste of money. But we found that the agencies are being successful in preserving at-risk habitat.”

Farmers are quick to point out that they are business people who need to maximize what they can generate from the lands under their control.

It would appear conservation agreements that keep wildlands and wetlands on the landscape are good business. And in a year like this one, they might make the rest of the farm a little less parched as well.

About the author

Vice-President of Content

Laura Rance

Laura Rance is vice-president of content for Glacier FarmMedia. She can be reached at [email protected]

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