SACRAMENTO, Calif. - California's almond orchards have been thriving during the past decade and now provide an $11 billion annual boost to the state economy. However, the growth coincides with another record development here - drought - and the extensive water needs of nut trees are posing a big challenge to state water policy.

SACRAMENTO, Calif. � California�s almond orchards have been thriving during the past decade and now provide an $11 billion annual boost to the state economy. Covering 860,000 acres, they account for 80 percent of world production.

However, the growth coincides with another record development here � drought � and the extensive water needs of nut trees are posing a big challenge to state water policy.

Farmers in the area where almond production has been most consistent have relied on water from a federally controlled project that draws its supply from the Sacramento River. But that source is coming to an end because of legal requirements that in a time of scarcity, waterways that nurture California salmon get needed water flows before farmers.

Some wealthy growers tried to get Congress to change those rules but failed. Also, new state groundwater legislation blocks farmers from drilling more wells.

Almonds �have totally changed the game of water in California,� said Antonio Rossmann, a Berkeley lawyer specializing in water issues. �It�s hardened demand in the Central Valley.�

Farmers are planting almonds because, as permanent crops, they do not need to be replanted after every harvest. They have been steadily taking over from cotton and lettuce because they are more lucrative.

�That�s the highest and best use of the land,� said Ryan Metzler, 45, who grows almonds near Fresno.

The problem is that not only do almonds and pistachios, another newly popular nut, need more water, but also the farmers choosing permanent crops cannot fallow them in a dry year without losing years of investment.

Now, the state is putting new controls on the groundwater that has gotten many farmers through the brutal drought � which still looms over the state, despite recent rains � and there is no certainty that the future of almond and pistachio orchards in areas such as the western San Joaquin Valley is secure.