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Water use in food production – Setting targets and monitoring KPIs

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The Global Water Crisis has been identified by the World Bank as being the biggest threat facing the planet over the next decadei. With global food production needing to increase by 50% by 2050 and with agriculture already accounting for about 70% of global water consumption, this poses a particular risk to food businesses. Growing publicity over the volumes of water required for production of agricultural productsii and the issues of water scarcity in sourcing countriesiii mean that food businesses are under increasing pressure to measure their water use, develop water management strategies and implement programs to reduce water use and understand their exposure to water risks.

Having a greater understanding of where and how water is used in their supply chain will help businesses identify water risk hotspots (e.g. sourcing products with high water demand from water scarce regions) and develop targeted, appropriate, mitigation plans. This article outlines one approach to assessing water use within the supply chain of agricultural production and how this approach can be used by food businesses to address their reputational and operational water risks.

 

Water use in food production – Setting targets and monitoring KPIs

Water used in food and agriculture – prioritising action!

Agriculture accounts for around 70% of water used in the world today and also contributes to water pollution from excess nutrients, pesticides and other pollutantsiv. As well as our food, agriculture grows fibres for textiles, fuel for energy and transportation and animal feed to supply our growing demand for meat. It is predicted by 2030, there will be a 40% shortfall in global water availability compared to requirementsv. Water intensive industries such as food and agriculture need to ensure that they, and their supply chains will continue to have a reliable and acceptable quantity of water to meet their needs.  

In the coming years, companies will increasingly find themselves in competition for water and other resources, and not just with other businesses but also with the residents and ecosystems who also depend on their local water/river catchment to meet their water needs. This growing demand (and increased competition) will inevitably lead to more frequent (and severe) incidents of water stress (i.e. demand for water exceeding local supply). Particularly considering the amplified impacts due to climate change, shifting weather patterns and increasing incidents of flood and drought. With all this in mind, it is likely that there will be increasing price instability, especially in agricultural markets as demand for irrigated commodities outstrips production.

Over the last 20 years there has been an increase in irrigation of high value crops in the UK, particularly potatoes and vegetables, which in 2005 accounted 86% of the total volume of irrigation water appliedvi. Irrigated agriculture is important to the UK’s rural economy, employing over 50,000 people and contributing over £3bnvii (14.5% of the total value of UK agricultural production - £20.7billionviii). Although in the UK many horticultural crops could be grown without the need for irrigation, supplemental irrigation is extensively used to improve cultivation and establishment of crops, yield, and most importantly qualityvii. In parts of England, water resources are already under pressure, particularly in areas with a high concentration of horticultural production. For agribusinesses operating in these catchments, retaining access to reliable supplies of water is already a priority.

How much more of the planet’s fresh water can agriculture claim? Companies need to shield themselves from such risks and protect the supply of agricultural raw materials their business depends on by making best use of the water resource that is available. Prioritising where to start addressing water risks in the supply chain can be a difficult task, particularly when the supply chain contains many commodities being sourced from many different locations. However, by increasing their understanding of where and how water is used in their agricultural supply chains, organisations can begin to prioritise actions towards areas with the greatest opportunity for savings in water use and/or highest water stress and set KPIs for improvement.

An incremental approach to reducing water risk over time

Whilst the idea of a full “water footprint” of all supply chains may seem a daunting task, businesses can start by prioritising key supply chains and using basic data and assumptions to give an initial indication of their green and blue water use and start to identify any opportunities for savings. Data can then be added to this over time as it becomes available, improving the accuracy and scope of the model. Not all supply chains have to be assessed at once, a couple of core supply chains could be initially assessed and this process could be expanded at a later date. This incremental approached can be shaped to meet specific concerns and the information available (Figure 1).

Green water footprint is the amount of water from rain that is used by the crop. It includes the total rainwater evapotranspiration (from fields / plantations) plus the water incorporated into the harvested crop

Blue water footprint is the amount of water applied to a crop not from rainwater (i.e. fresh surface or groundwater). In some situations a crop may get its entire water requirement for growth from rainwater so no blue water is required (as is the case for most UK grown cereals).

 

Figure 1 Depending on the level of information that you know bout your raw material supply chain (the crops) you can investigate water needs and water use at different levels

 

 

 

 

 

At a high level you can use crop volumes and location of production - combined with default climate data and crop data to estimate crop need for blue vs green water for it to be grown under optimal conditions. This can be refined if more regional procurement information is available. 

For those with detailed knowledge of suppliers and their production practices, it is possible to investigate the influence of irrigation type or practices on blue water use.

It is important that water use by the crop is also put into context of the overall water demand / availability in the location where the crop is produced – the water stress. And so, geographic water stress indicators can be included.

Understanding the balance of green water (rain) to blue water (irrigation) use in a location (at which ever level of detail is assessed) and the associated water stress in that location will help businesses to understand the water risks associated with the raw materials that they are purchasing.  For example, if they procuring a high water use crop in a location of high water stress, there is a high level of risk associated with the production of that crop and actions need to be put in place to mitigate that risk.

By adopting this approach, organisations can make use of the information already available to formulate an informed water strategy, identify if there are additional areas of data they need to capture to refine the strategy, set achievable targets (e.g. the increased adoption of more efficient types of irrigation) and establish a set of KPIs to monitor performance.  This approach can then be followed by more targeted risk assessments into areas that were identified as having an increased operational and reputational risk to the business, to help establish specific mitigation plans for each - protecting the security of supply of agricultural raw materials, whilst respecting the needs of the people and ecosystems at the scale of the local water/river catchment.


ADAS helps food businesses understand and mitigate the growing risk that water use poses their business. We tailor our approach to match specific company requirements and data availability. Our incremental approach helps businesses to:

  • Identifying water risks in the supply chain
  • Demonstrates company is taking a pro-active approach to water management
  • Gives a quantifiable metric which can be used for KPIs

For more information on the ADAS approach to reducing water risk in agricultural supply chains, please contact Sarah Wynn, sarah.wynn@adas.co.uk.


i http://reports.weforum.org/global-risks-2015/
ii http://www.bitc.org.uk/system/files/bitc-smart-water-web.pdf
iii http://www.businessgreen.com/bg/news/2409036/wwf-80-per-cent-of-uk-imports-sourced-from-water-risk-areas
iv http://www.oecd.org/agriculture/wateruseinagriculture.htm
v https://www.cdp.net/water
vi http://79.170.40.182/iukdirectory.com/iuk/pdfs/Climate%20change.pdf
vii http://www.ukia.org/
viii http://www.farming.co.uk/news/article/5677

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