This Water Policy Briefing is based on the CA Research Report 4: Does International Cereal Trade Save Water? The Impact of Virtual Water Trade on Global Water Use (CA Research Report 4) by Charlotte de Fraiture, Ximing Cai, Upali Amarasinghe, Mark Rosegrant and David Molden; and on Investing in Water for Food, Ecosystems and Livelihoods (BLUE PAPER, Stockholm 2004, Discussion Draft) by David Molden and Charlotte de Fraiture; and on Is Virtual Water Trade a Solution for Water Scarce Countries? by Charlotte de Fraiture and David Molden, Bridges 2004. By the year 2050 there will be an additional 3 billion people to feed. Food production may need to increase by 70-90 percent from levels in 2000 to meet this global food demand. Without improvements in the efficiency and productivity of agricultural water use, crop water consumption would have to grow by the same order of magnitude. A big challenge in water management is to grow sufficient food for a growing and more affluent population while meeting the many other demands on limited water resources—household needs, industrial requirements and environmental functions. Already, an estimated 20% of the global population lives in river basins that are characterized by physical water scarcity. International food trade can have significant impacts on national water demand. The term ‘virtual water’, first introduced by Allan (1998), refers to the volume of water used to produce traded crops. By importing food a country ‘saves’ the amount of water it would have required to produce it on its own soil. Thus, international food trade can have important mpacts on how and where water is used. Food trade reduces water use at two levels. At a national level, a country reduces water use by importing food rather than producing it. At a global level, trade reduces water use because, at present, production in exporting countries is more water efficient than in importing countries. Moreover, four of the five major grain exporters produce under highly productive rainfed conditions while importing countries would have relied more on irrigation. In fact, without cereal trade, global irrigation water demand would have been higher by 11%. Some researchers have suggested that international food trade can and should be used as an active policy instrument to mitigate local and regional water scarcity. They contend that, instead of striving for food self-sufficiency, water short countries should import food from water abundant countries. Indeed, food trade has a large potential to alleviate water scarcity, but in practice there are many reasons why this is unlikely to happen in the near future.

Food aid is a critical component of the global food system, particularly when emergency situations arise. For the first time, we evaluate the water footprint of food aid. To do this, we draw on food aid data from theWorld Food Programme and virtual water content estimates from WaterStat. We find that the total water footprint of food aid was 10 km3 in 2005, which represents approximately 0.5% of the water footprint of food trade and 2.0% of the water footprint of land grabbing (i.e., water appropriation associated with large agricultural land deals). The United States is by far the largest food aid donor and contributes 82% of the water footprint of food aid. The countries that receive the most water embodied in aid are Ethiopia, Sudan, North Korea, Bangladesh and Afghanistan. Notably, we find that there is significant overlap between countries that receive food aid and those that have their land grabbed. Multivariate regression results indicate that donor water footprints are driven by political and environmental variables, whereas recipient water footprints are driven by land grabbing and food indicators.

We present a network model of interstate food trade and report comprehensive estimates of embodied irrigation energy and greenhouse gas (GHG) emissions in virtual water trade for the United States (U.S.). We consider trade of 29 food commodities including 14 grains and livestock products between 51 states. A total of 643 million tons of food with a corresponding 322 billion m³ of virtual water, 584 billion MJ of embodied irrigation energy, and 42 billion kg CO₂-equivalent GHG emissions were traded across the U.S. in 2012. The estimated embodied GHG emissions in irrigation water are similar to CO₂ emissions from the U.S. cement industry, highlighting the importance of reducing environmental impacts of irrigation. While animal-based commodities represented 12% of food trade, they accounted for 38% of the embodied energy and GHG emissions from virtual irrigation water transfers due to the high irrigation embodied energy and emissions intensity of animal-based products. From a network perspective, the food trade network is a robust, well-connected network with the majority of states participating in food trade. When the magnitude of embodied energy and GHG emissions associated with virtual water are considered, a few key states emerge controlling high throughput in the network.

One possible approach for addressing water and food insecurity involves food production, trade, and water used elsewhere. In this study, we introduce a water footprint for Korean rice products and focus on the impacts of localized cultivation and water supply systems on the water footprint. In addition, we discuss several studies on the application of water footprint and virtual water trade in water and food management in Korea. Finally, we suggest the role of water footprint and virtual water trade in sustainable resource management through a water-energy-food nexus approach.

Food, energy, and water (FEW) systems are inexorably linked. Earth's changing climate and increasing competition for finite land resources are creating and amplifying challenges at the FEW nexus. Managing FEW systems to mitigate these negative impacts and stresses is a pressing policy issue. The FEW interface is often managed as three independent systems, missing disruptive opportunities for streamlined integrated management. We contend that existing technologies can be reframed and emerging technologies can be harnessed for integrated FEW management, changing the way that each resource system operates within the broader system. We discuss solutions to three main challenges to integrating FEW system management: resolving spatiotemporal disconnections over multiple scales; closing resource loops; and creating actionable information. Sustainable resource management is critical for humanity, as well as for functioning trade systems and ecological health. Embracing integrated management in FEW systems would enable policy makers and managers to more efficiently and effectively secure critical resource systems in the face of global change.

Recent years have shown increased awareness that the use of the basic resources water, food, and energy are highly interconnected (referred to as a ‘nexus’). Spatial scales play a major role in nexus analyses, and can be related to the physical characteristics and dependencies between nexus resources. In fact, water, food and energy are very different in terms of absolute magnitude of production, as well as in the extent to which they are traded. The differences in trade extent can partly be explained by physical differences: high value, high density, geographically concentrated resources are traded more. We show how input-output dependencies are more relevant at local to national scales, whereas the continental and global scales are important due to physical and virtual trade. We combined various insights into an overview of which spatial scales are most relevant for each nexus resource, based on physical characteristics, input-output dependencies, virtual trade, and potential future changes due to socio-economic trends, climate change impacts and climate change mitigation.

Water rights trading is an important way to solve the problem of water shortage by market mechanism. The allocation of water rights among ecological water, energy water, and grain planting water are the basis of the regional water rights trade. In this paper, the concept of coordinated development of water–ecology–energy–food is proposed. We build a water rights allocation model with fairness, efficiency, and coordinated development as the goal, to achieve water security for various industries. Taking Yinchuan city as an example, the results showed that compared with the current water rights the water rights of life increased by 1.07%, the water rights of ecology increased by 1.85%, the water rights of energy industry decreased by 1.09%, the water rights of food planting decreased by 3.27%, the water rights of other agriculture increased by 0.83%, and the water rights of the general industry increased by 0.65%. After the allocation of water rights, the cooperativity of water–ecology–energy–food increased by 7.56%, and the total value of water resources in various industries increased by 2.31 × 10⁸ CNY. A new water rights allocation model is developed in this paper, which can provide a reference for the allocation of water rights among regional industries.

In this study, the water footprint (blue, green and grey WF) and virtual water theory were used to uniform measure the new challenges (population growth, population urbanization, dietary structure change, energy industry development, grain trade and climate change) of food security in Northwest China. Moreover, this study quantified the demand for new challenges to water resources from 2000 to 2016, and then evaluated their impact on water resources and food security in Northwest China. The results showed that in 2000–2016, population growth caused the food consumption WF to increase from 153.8 Gm³ to 159.6 Gm³, with an average annual growth rate of 0.4%. The ratio of per capita consumption of WF of urban residents to rural areas has increased from 80.3% to 120%. The per capita food consumption in the region increased by 1.3% annually due to changes in dietary structure. However, with the increase of water use efficiency, the WF decreased by 0.3% per year. Among them, the total consumption WF of food rations decreased by 51.9%, with an average annual decrease of 4.4%, and that of meat, dairy products and aquatic products increased by 2.4%, 10.8% and 3.0% per year, respectively. From the economic point of view, the development of the energy industry has increased the competition index of energy-grain to water resources from 0.22 to 0.49. Due to climate change, although the precipitation increased at a rate of 3.2 mm/yr, the increase in ET₀ was 3.3 mm/yr, and thus the demand for water resources in agricultural production increased. Based on the results, this paper suggests to carry out measures such as optimizes crop planting structure, adopts effective biological, agricultural technologies, guides healthy food consumption structure, strengthens international food trade and biofuel use and so on to reduce the WF of grain crops and energy industry. Ultimately, the goal of reducing regional water stress and ensuring food security is achieved.

A spatial mismatch in water and arable land availability results in large virtual water transfers through interprovincial food trade in China. Accurately identifying and measuring water-saving links in interprovincial food trade can help to relieve water resources pressure in main grain-producing areas. We use a multiregional input-output table combined with the CROPWAT model to build China's interprovincial virtual water transfer network embedded in food trade in 2012. Then, water saving and scarce water saving are measured. Both consider the difference in water productivity among provinces, but the latter also pays attention to the scarcity of water resources. Finally, we adopt a water footprint to recalculate the scarce water savings without precipitation (green water). Our results indicate that the amount of virtual water transfer embedded in food trade is 74.9 billion m³, which is equivalent to 12.22% of the total water use in 2012. We observe large variations in the relationship between water resources abundance and agricultural water-use efficiency across provinces. Especially, there is a virtual water transfer from provinces with high water productivity but a lack of water to provinces with low water productivity but an abundance of water. The scarce water saving can identify sustainable food trade links, which can alleviate water scarcity in consuming provinces without exacerbating water shortage in producing provinces. In addition, interprovincial food trade results in 15 billion m³ of scarce gray water saving, which is equivalent to 59.76% of the scarce blue water saving. Scarce water saving based on blue water and gray water provides a basis for establishing an interprovincial compensation mechanism to balance the cost of water redistribution caused by food trade.