Food and biofuels likely to be hit by rising water risks to corn supplies
High water stress is jeopardising one-third of the world's corn crop, sparking food and biofuel security fears within the agricultural industry and related supply chains.
A report just out from sustainability think-tank Ceres highlights how US corn farmers, suppliers and investors are particularly vulnerable from water-related risks that could disrupt this $65bn industry. The US accounts for nearly 40% of global corn production.
These risks include unchecked groundwater withdrawals, nutrient pollution, shifting precipitation patterns from climate change, and increasing demand from cities and industries.
The World Resources Institute (WRI) fed into the study with its Aqueduct water risk atlas. It went beyond Ceres' domestic report to analyse the world's six largest corn producing countries: the US, China, Brazil, Mexico, Argentina and India. It found that one-third of the world's corn production occurs in highly or extremely highly water-stressed regions.
Corn is one of the largest sources of food calories, feeds the world's livestock, and is used extensively for ethanol production. About 15% of corn produced globally is consumed in other countries, with Japan, South Korea, and developing nations relying most on imports.
According to two of WRI's water analysts - Francis Gassert and Andrew Maddocks - this makes the crop a critical link between food security and the global economy.
Writing in a blog, they observed: "Each of the world's major corn-producing regions depends on the others. Any negative impacts that hit one country will likely have ripple effects globally, so regional environmental risks - particularly water-related risks - deserve close attention."
WRI's analysis shows that China, Mexico and India have the largest portions of their corn production coming from highly water-stressed areas. In highly water-stressed areas, more than 40% of renewable water supply is withdrawn for human use, leaving little buffer for inevitable dry years.
Major South American producers, on the other hand, are not as limited by water supply. Only 1% of Brazil's corn crop and 7% of Argentina's face high water stress. But WRI warns this situation may change as water limits for corn production are likely to be exacerbated as climate change alters global precipitation patterns.
"Global food production will need to rise 70% by 2050 to sustainably feed more than nine billion people," Gassert and Maddocks noted. "The strain on water security could be profound. Developing countries' increasing demand for energy will require billions of gallons of cooling water for power plants, diverting water formerly used by corn producers and other farmers."
Both WRI and Ceres offer some optimism, advising companies and investors to work together to build more resilient supply chains and to engage in multi-stakeholder efforts to undertake better water management practices. These include incentivising farmers to use water-friendly methods and taking public policy positions to support sustainable agriculture.
WRI further recommends that water stakeholders engage in participatory watershed development, practice conservation agriculture, and look to reduce food waste and corn demand for biofuels.