The global dynamics of virtual water

Population growth, the improvement of economic conditions, and urbanization, combined with lack of water, have profound implications for the development of countries, as noted in the report "La infraestructura del desarrollo en América Latina" (CAF, 2012)(Development Infrastructure in Latin America). Increasingly, more water is used for consumption than for farming. High costs, droughts,  and increasing prices discourage the cultivation of food. As a consequence, many countries prefer to import food rather than produce it locally. 

Since 1993, the term "virtual water" is used to refer to the amount of water required for the production of commodities or agricultural products, and for industrial production (Allan, 1997). For example, the production of 1 kilogram of wheat needs 1 m³ of water, while the production of 1 kilogram of meat needs between 10 and 13 m³ of water. 

The volume of "exported virtual water" by all the countries is estimated at 650 Km³ per year, and the "imported virtual water" is estimated at  1,000 Km³ per year (Yang & Zehnder, 2008). For the case of Latin America, it may be observed that South America exports 96 Km³ of water per year, of which 18 Km³ are sent to the Middle East, where water is scarce; This import is equivalent to 35 Km³ due to the productivity differences resulting from the use of the water. 

Globalization and the markets themselves respond by offering agricultural goods where productivity in general and the availability of water for agriculture plays a determinant role. Globally, the volume of "virtual water" associated with the production of marketable agricultural products is close to 15 percent of the total amount of water used in agricultural production. This is why countries prefer to import rather than produce.