When it comes to marketing, Coleman sells half of each year’s crop to one processor and splits the rest between three others, alternating each new load of nuts among them. A crop consultant reviews all the grading sheets and compares the results from the four buyers. “That way I have a pretty good idea if one processor is grading differently than another,” Coleman says.

Coleman’s drip-irrigated orchards use surface or well water or a combination of the two, depending on the particular ranch. For example, his largest property, a 300-acre block in Madera County, is irrigated with both. Two years ago, he spent $180,000 to put in a well that produces only 300 to 350 gallons of water per minute, far short of what he needs. That well plus the four others on the ranch provide no more than about half the total water required to produce a crop. The rest is provided by his local irrigation district using San Joaquin River water stored behind the Friant Dam in Millerton Reservoir.

Because of his subordinate rights to that water, Coleman pays a higher rate for it than does a Class 1 priority user. As a result, he gets his water from special supplies, which the irrigation district orders and which he pays for prior to the beginning of each irrigation season.

“My wells start out the year strong, but they’re not supplying what I need by August, when the demand for water by pistachio trees is the highest,” Coleman says. “So, I figure out how much additional water I’ll need then and that’s what I buy before the season starts. Often, in January, I have no idea how much, if any, surface water I’ll actually get in August. That makes planning kind of tough.”

Going into the year, thinking that water supplies would be short, he purchased quite a bit of water, at $228 an-acre-foot. He planned to delay using it as long as possible. However, more surface water was available than anticipated and the price had dropped to $150 an acre-foot. So, to conserve well water, he bought and used the cheaper surface water in the spring. “In August, I got a call that no more water would be available from the district that year after the end of the month,” Coleman says. “So, I did what I could to get the crop harvested as early as possible. Then, in October, when I was done harvesting, the irrigation district called again to tell me that more water was available.”

His pre-purchase price last year and this year - $275-per-acre-foot - is the most he’s ever paid for water to irrigate his Madera County orchards. In the mid-1980s, he was paying as little as $80 for the same amount of water. That compares to his ranch near Tranquility, in a different irrigation district, where now he can buy as much water as he wants for $47 per acre-foot.

Complicating Coleman’s job of managing water is uncertainty about the future impacts of plans to use some of the water from the Millerton Lake to help improve salmon habitat in the San Joaquin River. That would affect his largest ranch in Madera County. “It’s likely that my irrigation district will lose more water than any of the others. Because of my subordinate rights, the impact will bear down on me more than growers with Class I rights.”

His long-term strategy for dealing with this situation? “My hedge will be to buy more expensive land with better water rights,” he responds.