Foreign-owned farm no longer pumping groundwater on state land to feed cattle overseas, Arizona governor says

By Ella Nilsen, CNN

(CNN) — A Saudi Arabian farm previously permitted to pump unlimited amounts of groundwater to grow alfalfa for dairy cows overseas has stopped irrigating its crops on state land in Arizona’s Butler Valley, Democratic Gov. Katie Hobbs announced Thursday.

Hobbs and the Arizona State Land Department announced after a recent inspection Fondomonte had stopped pumping water in the Butler Valley groundwater basin and has begun to take steps to leave the property.

Hobbs took full credit for the outcome, saying it was a result of her move to terminate and decline to renew Fondomonte’s leases on state land in the area, part of a broader crackdown from Hobbs and her Democratic attorney general Kris Mayes.

“Today is the start of a new chapter for Arizona’s water future,” Hobbs said in a statement. “I’m not afraid to hold people accountable, maximize value for the state land trust, and protect Arizona’s water security.”

Arizona’s State Land Department used to lease thousands of acres to Fondomonte Arizona LLC, a farming operation owned by Middle East dairy giant Almarai Company, CNN previously reported. The state land department leased more than 6,000 acres to Fondomonte, it told CNN in 2022, making it the second-largest agricultural lessor of Arizona land.

Fondomonte previously held four separate leases on state land in the Butler Valley Basin. In October, Arizona officials notified the company three of its four leases would not be renewed and the fourth had been canceled due to default.

Besides the state lands it leased, the farm also owns land in both Arizona and California. The Almarai Company owns about 10,000 acres of farmland in Arizona under its subsidiary, Fondomonte. It also owns about 3,500 acres in agriculture-heavy Southern California, according to public land records, where they use Colorado River water to irrigate crops.

Fondomonte’s lawyer did not immediately return CNN’s request for comment.

Fondomonte is not the only foreign farm in the state. Al Dahra, a United Arab Emirates-based company farming alfalfa in the Southwest, also has operations in rural parts of the state. And several other corporate farms headquartered in other states have for years taken advantage of what Arizona residents and officials have long described as lax groundwater laws, allowing farms to pump unlimited water as long as they own or lease the property to drill wells into.

When Mayes and Hobbs took office, they vowed to crack down on foreign-owned farms leasing land from the state with the benefit of unlimited water pumping. State and federal analyses have found some groundwater basins are being severely overpumped.

Amid years of drought and a growing population in the state, Arizona officials have taken a number of steps to protect their water resources, including putting limits on new housing developments.

Last year when announcing new restrictions on Fondomonte’s pumping, Mayes said the Arizona Department of Water Resources had revoked permits Fondomonte sought to drill wells capable of pumping 3,000 gallons of groundwater per minute.

Such a rate of pumping is far more than what’s used in homes. According to state estimates, 325,000 gallons of water is enough for three average-size homes in Phoenix for a year.

In her statement, Hobbs said she would “continue taking decisive action to protect Arizona’s water so we can thrive for generations to come.”

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