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Water Rationing Begins Outside Malaysia Capital Amid Drought – Bloomberg

Water Rationing Begins Outside Malaysia Capital Amid Drought – Bloomberg.

By Chong Pooi Koon and Ranjeetha Pakiam  Feb 25, 2014 1:10 AM ET

Water rationing began in areas surrounding Malaysia’s capital after a prolonged drought, as Selangor state officials sought to wrap up talks to nationalize the local industry.

“The supply of raw water in Selangor state is in a critical condition,” Khalid Ibrahim, the state’s chief minister, said in a faxed statement late yesterday. “The water levels at a few dams have been shrinking to reach an alarming stage.”

Rationing may also start in parts of Negeri Sembilan, south of Kuala Lumpur, if there is no rain in coming days, the New Straits Times reported today, citing the state’s Chief Minister Mohamad Hasan. Several other states have also reported shortages amid rising concerns over the potential impact on Malaysian palm oil crops if the drought continues. Prime Minister Najib Razak is due to discuss the situation in cabinet tomorrow, including the possibility of cloud-seeding, the official Bernama news service said.

Opposition-controlled Selangor, which surrounds Kuala Lumpur, has been trying to nationalize water-treatment assets in its jurisdiction for years to restructure the industry and tackle periodic shortages. Malaysia’s local and national governments want to announce a final resolution to the buyout within two weeks, the state’s chief minister said Feb. 18.

Photographer: Mohd Rasfan/AFP/Getty Images

Residents collect water from a tank truck in Balakong, outside Kuala Lumpur on Feb. 20, 2014.

Commodities Impact

The regional government offered companies including Gamuda Bhd. (GAM) a combined 9.7 billion ringgit ($3 billion) for their assets in December, Sharizan Rosely, an analyst at CIMB Group Holdings Bhd., wrote in a Jan. 10 report. Kumpulan Perangsang Selangor Bhd. (KUPS) and Puncak Niaga Holdings Bhd. (PNH) are also being asked to sell.

Malaysia’s palm oil, cocoa and rubber-tapping industries are dependent on regular rainfall. An El Nino weather pattern, which can parch Australia and parts of Asia while bringing rains toSouth America, may occur in the coming months, Australia’s Bureau of Meteorology said today.

“It needs a very prolonged drought to have a severe effect” on palm oil production, Ling Ah Hong, director of Malaysian research and consulting company Ganling Sdn., said by phone. “This current drought is only about three to four weeks.”

A prolonged drought might have a lagged effect on next year’s production, mainly through floral abortion when cells die before they can mature, said Ling.

Palm Prices

Crude palm oil prices have climbed 7.6 pecent this month and rose 0.4 percent to 2,753 ringgit per metric ton as of the 12:30 p.m. trading break in Kuala Lumpur, according to data compiled by Bloomberg.

The positive price uptrend for crude palm oil is expected to be sustained as the current hot and dry weather affects parts of Malaysia and IndonesiaIOI Corp. (IOI), Malaysia’s second-largest palm oil producer by market value, said in a stock exchange filing today.

The dry weather began in early February and may last until mid to end of March, the Malaysian Meteorological Department says in e-mailed statement to Bloomberg News today. El Nino weather conditions may develop after May or June, it said.

For optimal yield per hectare, palm oil requires rainfall of 1,500-2,000 millimeters or more distributed evenly through the year without a drought of more than three months, the department said.

Production Impact

“The severity of the decline in production will depend on how long the dry season lasts,” Alan Lim Seong Chun, an analyst at Kenanga Investment Bank Bhd., said by phone in Kuala Lumpur. “In the worst-case scenario, it can drop to 30 percent below normal.”

Residents in parts of Selangor will get water on alternate days and rationing will continue until the end of March if hot weather continues, the chief minister said. The government will evaluate the situation before deciding on whether to declare an emergency, Bernama reported on Feb. 21, citing Najib.

“If the drought continues past March, then we might have to deal with more severe rationing that could possibly have an impact on our GDP,” Yeah Kim Leng, chief economist at RAM Holdings Bhd., said in a phone interview from Kuala Lumpur. “It’s likely to be short-lived.”

Neighboring Singapore had a record 27 consecutive days of dry weather from Jan. 13, the country’s National Environment Agency said. The rain shortage may extend into the first half of March, it said in a statement.

To contact the reporters on this story: Chong Pooi Koon in Kuala Lumpur atpchong17@bloomberg.net; Ranjeetha Pakiam in Kuala Lumpur at rpakiam@bloomberg.net

To contact the editor responsible for this story: Barry Porter at bporter10@bloomberg.net

Its Great Lake Shriveled, Iran Confronts Crisis of Water Supply – NYTimes.com

Its Great Lake Shriveled, Iran Confronts Crisis of Water Supply – NYTimes.com.

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An abandoned ship rusts in the mud on the south shore of Lake Urmia, where only 5 percent of the water remains, Iranian environmental officials say. Morteza Nikoubazl for The New York Times

LAKE URMIA, Iran — After driving for 15 minutes over the bottom of what was once Iran’s largest lake, a local environmental official stepped out of his truck, pushed his hands deep into his pockets and silently wandered into the great dry plain, as if searching for water he knew he would never find.

Just an hour earlier, on a cold winter day here in western Iran, the official, Hamid Ranaghadr, had recalled how as recently as a decade ago, cruise ships filled with tourists plied the lake’s waters in search of flocks of migrating flamingos.

Now, the ships are rusting in the mud and the flamingos fly over the remains of the lake on their way to more hospitable locales. According to figures compiled by the local environmental office, only 5 percent of the water remains.

Iran is facing a water shortage potentially so serious that officials are making contingency plans for rationing in the greater Tehran area, home to 22 million, and other major cities around the country. President Hassan Rouhani has identified water as a national security issue, and in public speeches in areas struck hardest by the shortage he is promising to “bring the water back.”

Lake Urmia

Experts cite climate change, wasteful irrigation practices and the depletion of groundwater supplies as leading factors in the growing water shortage. In the case of Lake Urmia, they add the completion of a series of dams that choked off a major supply of fresh water flowing from the mountains that tower on either side of the lake.

“Only some years ago the water here was 30 feet deep,” Mr. Ranaghadr said, kicking up dust with each step on the dry lake bed. In the distance, spots of land — once islands where tourists would spend vacations in bungalows overlooking the blue waters — were surrounded by plains of brown mud and sand. “We just emptied it out,” he said with a sigh, stepping back into the car.

Iran’s water troubles extend far beyond Lake Urmia, which as a salt lake was never fit for drinking or agricultural use. Other lakes and major rivers have also been drying up, leading to disputes over water rights, demonstrations and even riots.

Major rivers near Isfahan, in central Iran, and Ahvaz, near the Persian Gulf, have gone dry, as has Hamoun Lake, in the Afghanistan border region. Dust from the dry riverbeds has added to already dangerously high air pollution levels in Iran, home to four of the 10 most polluted cities in the world, the United Nations says.

But nowhere is the crisis more pronounced than at Lake Urmia, once one of the largest salt lakes in the world — at 90 miles long and roughly 35 miles wide, it was slightly larger than Great Salt Lake in Utah. Environmentalists are warning that the dried salt could poison valuable agricultural lands surrounding the lake, and make life miserable for the three million people who live in its vicinity.

Along what used to be a lakeshore boulevard, worn-down snack bars and dressing rooms are testament to the days when people from across Iran would come to water-ski on the lake or cover themselves in its black mud, which is said to have healing powers.

About two decades ago, a local villager, Mokhtar Cheraghi, began to notice the water line receding. “First a hundred meters, then two hundred meters. After a while, we couldn’t see the shoreline anymore,” he said, standing in what was once his thriving cafe, Cheraghi’s Beach. “We kept waiting for the water to return, but it never did.”

Most people in the area blame the half-dozen major dams the government has built in the region for the lake’s disappearance. The dams have greatly reduced the flow of water in the 11 rivers that feed into the lake. As an arid country with numerous lofty mountain chains, Iran has a predilection for dams that extends to the reign of Shah Mohammed Reza Pahlavi.

Dam construction was given renewed emphasis under Mr. Rouhani’s predecessor as president, Mahmoud Ahmadinejad, who as an engineer had a weakness for grand projects. Another driving force is the Islamic Revolutionary Guards Corps, which through its engineering arm, Khatam al-Anbia Construction, builds many of the dams in Iran and surrounding countries.

Half an hour’s drive into the mountains above the city of Urmia stands the mighty Chahchai Dam, collecting water that would otherwise have reached the lake. The dam, finished during Mr. Ahmadinejad’s first term, now holds a huge lake itself, which local farmers use for irrigating their lands.

“Some of Urmia’s water is here,” said Mr. Ranaghadr, raising his voice over the howling winds that blow down from the surrounding snowcapped peaks. “The people here need water, too, is what they say.”

Besides producing badly needed electricity, the dams are intended to address the water shortage. But too often, the water is wasted through inefficient irrigation techniques, particularly spraying, Mr. Ranaghadr and other experts say.

In recent decades, the amount of land dedicated to agriculture in the region, the country’s heartland, has tripled, with many farmers growing particularly thirsty crops like grapes and sugar beets, Mr. Ranaghadr pointed out. His department has calculated that about 90 percent of all the water that should end up in the lake is sprayed on fields.

In a 2005 book that he wrote on national security challenges for Iran, Mr. Rouhani estimated that 92 percent of Iran’s water is used for agriculture, compared with 80 percent in the United States (90 percent in some Western states).

“They turn open the tap, flood the land, without understanding that in our climate most of the water evaporates that way,” said Ali Reza Seyed Ghoreishi, a member of the local water management council. “We need to educate the farmers.”

The lake has also been attacked from underground. As part of the government’s drive to promote local agriculture, large landholdings were divided into smaller plots, and most of the new owners promptly dug new wells, soaking up much of the groundwater.

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