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Chapter 2. Emerging Water Shortages: Farmers Losing to Cities
In the competition for water among agriculture, cities, and industry, the economics of water use do not favor farmers, simply because it takes so much water to produce food. For example, while it takes 1,000 tons of water to grow a ton of wheat, it takes only 14 tons to make a ton of steel. In China, where water scarcity is a national security issue, 1,000 tons of water can be used either to produce 1 ton of wheat worth, at most, $200, or to expand industrial output by $14,000—70 times as much. In a country preoccupied with expanding the economy and creating jobs, the policy decision to make agriculture the residual claimant comes as no surprise.40
Many of the world's largest cities are located in closed basins. Cities in these watersheds, such as Mexico City, Los Angeles, Cairo, and Beijing, can increase their water consumption only by importing water from other basins or taking it from agriculture.
In a world of water scarcity, literally hundreds of cities are now taking water from agriculture. Among the U.S. cities that are likely to satisfy future growth in water demands by taking irrigation water from farmers are San Diego, Los Angeles, Las Vegas, Denver, and El Paso. A USDA study of 11 western states for 1996 and 1997 found that during these two years, annual sales of water rights averaged 1.65 billion tons or roughly 1 percent of the underground water used for irrigation nationwide.41
When the federal government reduced the flow of Colorado River water into California by 765 million tons on January 1, 2003, in accordance with a longstanding agreement that allocated the river's water among several states, it immediately set off a flurry of urban water purchases from farmers in California, including a 120-million-ton water purchase from the Sacramento Valley Irrigation District by San Diego's Municipal Water District. This purchase meant that farmers would idle riceland, reducing rice production by an estimated 120,000 tons or 3 percent of U.S. consumption.42
Literally hundreds of cities in other countries are meeting their growing water needs by taking some of the water that farmers count on. In western Turkey, for example, Ismir now relies heavily on well fields from the neighboring agricultural district of Manisa.43
Although reliable projections of rural-urban transfers do not yet exist for many countries, World Bank calculations for South Korea, a relatively well watered country, indicate that growth in residential and industrial water use there could reduce the supply available for agriculture from 13 billion tons at present to 7 billion tons in 2025.44
Between 2000 and 2010, the World Bank projects that China's urban water demand will increase from 50 billion cubic meters (50 billion tons) to 80 billion, a growth of 60 percent as the country's population is projected to grow by 90 million. Industrial water demand, meanwhile, will go from 127 billion cubic meters to 206 billion, up 62 percent. Several hundred cities are looking to the countryside to satisfy their future water needs. In the region around Beijing, this shift has been under way since 1994, when farmers were banned from the reservoirs that supplied the city.45
As China attempts to accelerate the economic development of the upper Yellow River basin, emerging industries upstream get priority in the use of water. And as more water is used upstream, less reaches farmers downstream. In most recent years, the Yellow River not only has failed to reach the sea for part of the year, but sometimes it has failed to reach Shandong, the last province that it flows through en route to the sea.46
Farmers in Shandong have traditionally received roughly half of their irrigation water from the Yellow River and half from wells. Now they are losing water from both sources as the downstream river flow shrinks and as overpumping depletes local aquifers. Losses of irrigation water in a province that produces a fifth of China's corn and a seventh of its wheat help explain why China's grain production is declining. As a supplier of grain, Shandong is more important to China than Iowa and Kansas together are to the United States.47
Although there is no worldwide monitoring system for the diversion of irrigation water to cities and industry, the trend is clear. Slowly but surely cities are siphoning water from agriculture even as the world's farmers try to feed 70 million more people each year.48
40. Water for steel production from Postel, op. cit. note 31, p. 137.
41. Noel Gollehon and William Quinby, "Irrigation in the American West: Area, Water and Economic Activity," Water Resources Development, vol. 16, no. 2 (2000), pp. 187-95.
42. John Krist, "Water Issues Will Dominate California's Agenda This Year," Environmental News Service, 21 February 2003.
43. Shah et al., op. cit. note 17.
44. Gershon Feder and Andrew Keck, Increasing Competition for Land and Water Resources: A Global Perspective (Washington, DC: World Bank, March 1995), pp. 28-29.
45. Population projections from United Nations, op. cit. note 8; China water demand from World Bank, op. cit. note 1; Brown and Halweil, op. cit. note 35.
46. Postel, op. cit. note 3, pp. 65-66.
47. Brown and Halweil, op. cit. note 35.
48. Population estimates from United Nations, op. cit. note 8.
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