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Tuesday 29 March 2022 11:42 am  |  Updated:  Wednesday 28 September 2022 2:26 pm

Why agriculture holds the key to tackling water waste

By: Felix Odey

Portfolio Manager, Global Resource Equities - Schroders

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Water companies have faced fierce backlash for presiding over a massive increase in sewage dumping into British rivers.
Water companies have faced fierce backlash for presiding over a massive increase in sewage dumping into British rivers.

Water is a precious resource. Ensuring we have enough water for a growing global population in a time of climate change is one of the most important challenges of our time.

But in our view it’s impossible to talk about water without also talking about food. Agriculture uses 65% of the world’s fresh water, but almost half of it is currently wasted. Making our food and water systems sustainable requires a holistic approach.

604412-World-Water-Day-Chart-01.png

The growing global population also puts pressure on the food system. Irrigation is one way to solve this; agricultural yields double when irrigation is used, rather than relying on rainfall. But the challenge is to ensure that this is done efficiently so that water is not wasted.

This is where technology has a crucial role to play. Greater investment is needed in irrigation and drainage systems. It’s not enough just to build such systems; making sure they are adequately maintained is crucial to keeping them running efficiently.

Meanwhile, investment in desalination plants is also critical given the limited supply of fresh water in many regions globally.

Then there are more advanced technologies. For example, soil moisture sensors can be used to check exactly how much water is needed, and when, for crops.

Discover more by visiting Schroders’ insights or click the links below:
– Follow: Live blog: what does Russia’s invasion of Ukraine mean for markets
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Learn: How climate leaders will trump complacent companies

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The whole water management system is one where we expect demand to increase substantially. Recycling the 45% of water that is currently wasted will help the global food and water system become more sustainable.

And it’s not just water that is wasted. Food waste is a huge problem and, of course, when food is wasted, the water that was used in its production is also wasted. Around 44% of harvested crops are lost before they reach the consumer. Again, technology is a crucial enabler in reducing that waste.

Using water more efficiently is clearly part of the answer to making our water system more sustainable. There are also ways to simply use less water in agriculture, and this can happen via changes to diets. Consumers, rather than food producers, can be the driving force here.

It’s increasingly well understood that livestock farming – especially for beef – is extremely resource intensive in terms of the amount of land required. Beef cattle are also responsible for a large amount of the harmful gas emissions from the food industry. But beef production additionally consumes a vastly higher amount of fresh water than other sources of protein, such as pulses, as the green bars on the chart below show.

604412-World-Water-Day-Chart-02.png

Again, this just goes to show how the problem of water usage cannot be seen in isolation but has to be tackled alongside food. Both systems need to be made more sustainable as demand grows.

Felix was also a guest on the Investor Download podcast speaking about the food and water crisis. You can subscribe to the Investor Download on Apple, Spotify, Google or wherever you get your podcasts. New shows drop every Thursday at 1700 GMT.


Topics:

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  • Felix Odey
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Important Information: This communication is marketing material. The views and opinions contained herein are those of the author(s) on this page, and may not necessarily represent views expressed or reflected in other Schroders communications, strategies or funds. This material is intended to be for information purposes only and is not intended as promotional material in any respect. The material is not intended as an offer or solicitation for the purchase or sale of any financial instrument. It is not intended to provide and should not be relied on for accounting, legal or tax advice, or investment recommendations. Reliance should not be placed on the views and information in this document when taking individual investment and/or strategic decisions. Past performance is not a reliable indicator of future results. The value of an investment can go down as well as up and is not guaranteed. All investments involve risks including the risk of possible loss of principal. Information herein is believed to be reliable but Schroders does not warrant its completeness or accuracy. Some information quoted was obtained from external sources we consider to be reliable. No responsibility can be accepted for errors of fact obtained from third parties, and this data may change with market conditions. This does not exclude any duty or liability that Schroders has to its customers under any regulatory system. Regions/ sectors shown for illustrative purposes only and should not be viewed as a recommendation to buy/sell. The opinions in this material include some forecasted views. We believe we are basing our expectations and beliefs on reasonable assumptions within the bounds of what we currently know. However, there is no guarantee than any forecasts or opinions will be realised. These views and opinions may change.  To the extent that you are in North America, this content is issued by Schroder Investment Management North America Inc., an indirect wholly owned subsidiary of Schroders plc and SEC registered adviser providing asset management products and services to clients in the US and Canada. For all other users, this content is issued by Schroder Investment Management Limited, 1 London Wall Place, London EC2Y 5AU. Registered No. 1893220 England. Authorised and regulated by the Financial Conduct Authority.

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