From drought and groundwater restrictions to labor shortages and changing markets, California agriculture has consistently responded to major challenges through innovation. A new, special issue of ARE Update explores whether California's emerging bioeconomy can create new value from the state's existing biological resources—all while strengthening rural economies and preparing workers for new industries.
California’s bioeconomy has historically centered the production of food, feed, and fiber. But rather than focus on how to further improve production, researchers and policymakers across the state are now exploring how agricultural byproducts, forest materials, and food waste can become feedstocks for renewable energy, new manufacturing industries, and other higher-value products.
"The bioeconomy represents a transformative pathway for addressing 21st-century challenges of climate change, environmental degradation, and rural economic decline," said issue co-editor David Zilberman, a distinguished professor of the graduate school in the Department of Agricultural & Resource Economics.
To show what the bioeconomy looks like in practice, Zilberman and UC Davis researchers Sat Darshan S. Khalsa and Patrick H. Brown examined agricultural circularity within California's almond industry. Almond hulls currently support a dairy feed market worth an estimated $160 million to $230 million annually. Based on the authors’ analysis, a secondary market for returning almond shells to orchards could exist if transportation costs were low enough and shell amendments were needed. Under those conditions, the practice could generate an additional $21 million to $31 million in annual value while recycling nutrients, improving soil health, and reducing waste.
In a separate study, Assistant Professor of Cooperative Extension Alexandra Hill analyzed new workforce data to quantify bioeconomy-related job growth in the state. She found that the number of job postings in California increased 14-fold between 2015 and 2025, with forestry emerging as the state's largest source of bioeconomy-related employment. Nearly half of the listings required no previous experience. These findings help identify the occupations and skills that are becoming increasingly important to California's bioeconomy, and reinforce the need for workforce training through community colleges, universities, and industry partnerships as the sector continues to grow.
Also in the issue, UC Davis professor Anne Visser examines how groundwater regulation, labor shortages, and climate pressures are reshaping the San Joaquin Valley. She notes that complying with the Sustainable Groundwater Management Act (SGMA) alone could lead to up to a million acres of fallowed farmland by 2040. But, rather than framing those changes only as losses, Visser explores how they could support new regional industries built around California's estimated 54 million metric tons of annual biomass resources—including approximately 10 million metric tons of agricultural residues. Successfully rising to these challenges, she argues, will depend on modernizing regulations, investing in regional processing infrastructure, and preparing a workforce capable of supporting new bio-based industries.
Together, these studies suggest that California's next wave of innovation may come not from replacing agriculture's traditional strengths, but from building on them. Developing markets for agricultural byproducts, investing in regional infrastructure, expanding workforce training, and strengthening partnerships among universities, Cooperative Extension, industry, and policymakers could help California create new economic opportunities while improving resource use and supporting resilient rural communities.
To learn more about California's growing bioeconomy, read the Special Issue of ARE Update Vol. 29, No. 5, The Bioeconomy and Its Potential to Enhance California Agriculture at the Giannini Foundation Website.
About ARE Update
ARE Update is a bimonthly magazine published by the Giannini Foundation of Agricultural Economics to educate policymakers and agribusiness professionals about new research or analysis of important topics in agricultural and resource economics. Articles are written by Giannini Foundation members, including University of California faculty and Cooperative Extension specialists in agricultural and resource economics, and university graduate students. Learn more about the Giannini Foundation and its publications at https://giannini.ucop.edu/
NOTE: This story was lightly adapted from original material provided by the Giannini Foundation of Economics.
