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A Farm Level View on Supply Chain Water Risk

WATSONVILLE, CA—Lettuce is a thirsty crop in parched California. It takes roughly 12 gallons to grow a single head, and Chris Willoughby, a mid-sized grower of leafy greens, broccoli and cabbage, is doing his best to cut back on that amount.

Lettuce crops at Chris Willoughby's farm in Watsonville, CA
Lettuce crops at Chris Willoughby’s farm in Watsonville, CA

When his wells ran salty 10 years ago, following decades of regional groundwater over pumping, he turned to Watsonville’s recycled wastewater plant, installing—at his own expense—the necessary piping and valves to tap into the more expensive recycled water.

It doubled his water costs.

Willoughby intensified his use of drip irrigation and changed his tillage practices “big time” to further conserve water. As a result, he’s managed to achieve a 15 percent reduction in his water use since 2013.

He may be ahead of the curve on water stewardship among California’s thousands of vegetable growers, but he wouldn’t know. Though his buyers ask him to report his water use, they don’t provide him feedback on how he compares to similar growers.

As California’s agricultural community faces mandatory water cutbacks, growers are bearing the brunt; yet, the entire supply chain, from farm to fork, has a stake in ensuring the long-term sustainability of water supplies. Ceres new report, Feeding Ourselves Thirsty: How Global Food Companies are Managing Water Risk, found that very few global food companies are assessing water risk in their agricultural supply chains, or working with their growers to improve water management.

Willoughby’s experience, at the base of the supply chain, provides a microcosm of some of the barriers—and opportunities—for better collaboration on water management.

Daniel Mountjoy, Sustainable Conservation (left) and Chris Willoughby, vegetable farmer
Daniel Mountjoy, Sustainable Conservation (left) and Chris Willoughby, vegetable farmer

It All Starts with Good Data

Managing any kind of risk starts with good information, but collecting and managing water use data up the supply chain can be a surprisingly tough nut to crack.

Agricultural supply chains are highly complex. Willoughby, for example, sells to four shippers who wash and bag his greens before moving them quickly up the supply chain to retailers like Walmart and food service companies that supply restaurants, colleges and other institutions all over the country.

At the end of this supply chain, Willoughby’s greens are sold as branded bag lettuces, comingled with other growers’ greens. That means his farm level water use data is averaged in with many other growers’ data.

“The longer the supply chain, the weaker the connection between the farmer’s management information and the ultimate consumer,” says Daniel Mountjoy, of Sustainable Conservation, which led a recent tour of Willoughby’s fields.

Inexact water use data is more of a problem in fragmented supply chains, like Willoughby’s, where each link acts independently and contracts are subject to change.

“My shipper may say I need five acres of red lettuce on May 30,” Willoughby explains, “but when May 30 comes around, they’ll say, ‘actually I only need half of what you grew.’”

That’s because his shippers are at the mercy of restaurants and grocery store chains’ forecasting models.

But it leaves growers like Willoughby scrambling to find another buyer who might be short on that date, and it can complicate their water use accounting.

Furthermore, though shippers typically draw on the same limited water resources when they wash—and in some cases triple wash—growers’ produce, farmers like Willoughby typically have no idea how that water use is reported up the chain, or how it compares to their own.

More vertically integrated supply chains, in contrast, can allow for better collaboration on water management. Take Olam Spices and Vegetable Ingredients, a global food company that grows, sources and processes onions, garlic, parsley and tomatoes throughout California’s Central Valley.

Sprinkler irrigation on Central Valley farm. Olam's vertical supply chain has allowed it to developed onion varieties that thrive with drip irrigation and rotate more easily with tomato crops to both save water and preserve soil health.
Traditional, water-intensive sprinkler irrigation on a Central Valley farm. Olam’s vertical supply chain has allowed it to developed onion varieties that thrive with drip irrigation and rotate more easily with tomato crops to both save water and preserve soil health.

Olam provides seeds, plantings and crop management assistance to its growers, who receive contracts one year in advance. Its close relationships with growers have enabled it to innovate water efficiency solutions at the farm level, according to Alejandra Sanchez, the sustainability lead at Olam. Olam is developing farm management practices that will allow their onion varieties to thrive with drip irrigation, and rotate more easily with tomato crops, to both save water and preserve soil health.

Better Metrics for Better Trust

Yet one of the thorniest issues in supply chain water risk management is what measurement to use, and for whose purposes.

“Metrics have value at each step of the supply chain, but they may be different metrics,” says Mountjoy. “What’s valuable to the grower has a lot more detail in it, but it ends up getting aggregated at the shipper level.”

Aggregating the standard measure for water management, water use per acre, loses important farm level context, such as weather or field conditions that affect water use. That leaves growers “with a lot of concerns about how data is used and tracked, and anxiety about sharing it with the supply chain,” says Mountjoy.

Growers who farm in the valley’s hotter inland region, and use more water by necessity than farmers on the cooler coast worry, that without their farm level context, buyers may drop them, even though they be more water efficient, says Mountjoy.

To better ensure that farm level context makes its way to the top of the supply chain, Sustainable Conservation is part of a collaborative initiative – the Stewardship Index for Specialty Crops – that’s piloting a metric to capture water efficiency. The measure, acre-feet of water per crop water demand, accounts for farm level weather conditions, ensuring that buyers get a more complete picture of farmers’ water use.

The group is testing the metric’s efficacy at all levels of the supply chain. If successful, it just may crack open communication between growers and buyers, and streamline data collection efforts.

Opportunities for Improving Collaboration

Beyond using better metrics to assess water use, there is much more that corporate buyers can do to improve water management in their supply chains, such as:

  • Provide growers with feedback, or peer comparison data on their water use (using metrics that allow for meaningful comparison). Let them know how their data will be used, and why disclosure can benefit, rather then penalize, them.
  • Participate in initiatives to standardize collection of water use data to streamline data gathering efforts.
  • Engage in, or financially support, dialogue and planning at the watershed level with key stakeholders, communities and other industries. Efficient use of water by an individual farmer may not achieve sustainability of a watershed if other farmers, or other supply chain partners or industries, are not managing water from that watershed wisely.
  • Help finance the necessary equipment to help improve water efficiency, such as monitors that measure soil moisture conditions and wireless towers that allow for real time access to field data.

In the end, corporate buyers can go a long way by letting growers know that they recognize water is a shared resource and that farmers are not the only ones responsible for conserving water.

As Olam’s Sanchez says, “We all have straws going into the same glass of water.”

About the Author

Meg Wilcox is a Senior Manager, Communications at Ceres, a nonprofit organization mobilizing business and investor leadership on global sustainability challenges. Connect with her on Twitter @WilcoxMeg or by email wilcox@ceres.org. Learn more about Ceres at www.ceres.org/valuingeverydrop.

Comments

  1. Larry Jacobs
    Pescadero, California
    July 10, 2015, 10:42 pm

    Paul and Ceres,
    The Stewardship Index for Specialty Crop’s water metric hasn’t consider the increased costs in the water metric associated with excess rainfall. I don’t see a clean way to incorporate this into the metric.

  2. Tom Reynolds
    Tempe, AZ
    June 24, 2015, 10:44 am

    It is so refreshing to see Ceres working to move food companies towards higher accountability and sensitivity to grower’s risks in being efficient….all in the face of utterly profound risks of unsafe foods getting upon consumer’s tables.
    I work with growers who are very, very challenged getting even close to managed deficit irrigation (and N nutrition), complicated by the facts you already pointed out. I stand in awe of one particular grower that leads Maricopa County in production of leafy crops destined for distant outlets. He primarily sprinkle irrigates and compost feeds. His water use per crop water demand could be registered, but he won’t likely sacrifice quality, volume, safety, and harvest date just to know what that metric is, which then would position him to dial it back.
    System design which enables discreet (8-10 acre blocks) system monitoring and control, distribution uniformity’s over 90%, and crop ecology monitoring for statistically calculated irrigation timing are feasible for his high-value products. A model system, not unlike CAFE standards is probably on the horizon for these crops. But moving grain, cotton, and alfalfa growers there, moving homeowners and municipal institution system managers there, in near total unison….that is where the target needs to be. And the recalcitrant, bad actors need to to be ostracized.

  3. Stephan Becker
    Germany
    June 7, 2015, 11:12 am

    Hi,
    thanks for your very interesting report.

    Is this “used” water:
    “Furthermore, though shippers typically draw on the same limited water resources when they wash—and in some cases triple wash—growers’ produce, ”

    flowing back to the growers or it is transferred to the next canal or river?

    Isn’t shade another possibility to further reduce the necessary amount of water in agriculture?

    • Ceres
      June 8, 2015, 10:36 am

      Good question, Stephan. We believe that the recycled water is used for irrigation purposes only. The point was more that if shippers are using regional groundwater resources to wash produce, they’re tapping into the same supplies available to farmers, and contributing to the overdraft problem in the region that has resulted in some farmers’ wells going salty — and hence their need to rely on the city’s recycled water for irrigation. Yet the larger point of the article is that there’s a need for all members of the supply chain to communicate about and share the responsibility for management of limited water resources. For more info on Watsonville’s recycled water system see: http://cityofwatsonville.org/public-works-utilities/wastewater-treatment-plant/recycled-water

  4. Paul Underhill
    California
    June 4, 2015, 11:38 pm

    I am curious if you are going to come up with a metric to acknowledge that certain growing regions of California have higher natural rainfall and more sustainable water supplies (ground and surface). Growers in higher rainfall areas have higher associated costs due to disease and other wet-weather related problems compared to growers in drier areas. Historically, this has aided growers in drier regions and shifted crops to those areas irregardless of potential water supply problems. It would be nice to see some credit given to farmers who have persisted in growing crops in wetter regions despite the clear economic disadvantages of doing so.

    • Ceres
      June 5, 2015, 1:52 pm

      Paul, you raise a great point and a challenging issue. We don’t know of water use metrics that factor in excess rainfall and the impact on plant health, but it’s certainly a metric worth developing. While Ceres does not develop metrics to measure water use, other organizations like Field to Market and the Stewardship Index for Speciality Crops are doing great work on metrics, and may be able to help you. Ceres focuses on moving food companies to support growers’ improvement of on farm practices.