Farmers in the Central Valley of California base their decisions about what to plant each year on a range of factors, including weather forecasts, commodity prices, “and what their neighbors are doing,” says Daniel Munk, farm adviser for the University of California Cooperative Extension Service in Fresno County. “They consider all these variables, but then there’s still a big roll of the dice.”

These days, the most important and the most uncertain of those variables is water. And...

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