International agricultural trade plays a central role in balancing global food supply and demand, but with every shipment of crops crossing borders, the water used to produce them is “virtually transferred” as well, reshaping the distribution of water resources worldwide.
But to what extent?
A new report by the UN University Institute for Water, Environment and Health (UNU-INWEH) reveals that virtual water transfers through food trade generally reduce water scarcity for much of the global population, while at the same time deepening shortages for millions of others, particularly those in low-income communities.
The authors of the report write: “When food is imported, countries effectively save the water that would have been needed to produce it domestically, easing pressure on their own supplies. This option is most accessible to high-income countries, which can afford to source crops internationally. By contrast, when food is exported, the water embedded in those crops flows abroad. For many developing countries, these exports generate revenue but also deplete limited local resources, leaving less water available for their own populations.”
For example, 75% of the population in high-income countries and 62% in low-income countries experience reduced water scarcity as a result of virtual water transfers. On the other hand, food trade exacerbates water scarcity for 22% of the population in high-income countries, while this share rises to 37% in low-income countries.
“This form of ‘virtual water trade’ reflects a broader pattern of environmental injustice around the world, where the environmental costs and risks are increasingly shifted from those who can afford to absorb them to those who cannot,” said Professor Kaveh Madani, director of UNU-INWEH and the co-author of the report.
Madani said the findings are a “wake-up call about another inequity problem the rich nations are mainly accountable for. The existing global food trade system continues to make the world’s most vulnerable people and nations more vulnerable.”
The analysis also reveals that international agricultural trade “almost never produces outcomes that are purely positive or negative. Instead, it creates trade-offs that reveal sharp contrasts across regions and income levels.”
The authors called for policies that focus on how trade outcomes affect lower-income populations, and not only on overall water availability.
