New policies to conserve water and plan irrigation are needed to meet soaring food demand, according to a recent Kansas City Federal Reserve report.
Agricultural production must grow by 50 to 100 percent to meet expected demand by 2050, but rates of yield growth have been linear for the last 60 years. If that continues, demand cannot be met from the amount of land currently in use.
Click to enlarge. Source: FAOSTAT.
With limited land available to convert to agricultural production, high-yield irrigated crops offer a source of growth. Irrigated corn, for example, can achieve double the yield of rain-fed crops. But irrigation already accounts for roughly 70 percent of strained water supplies.
Improvements in irrigation are therefore crucial. In developed regions, surface irrigation is giving way to pivot and drip methods. Conservation tillage and crop rotations planned to minimise water use could improve efficiency on irrigated farmland.
Improved drought resistance in crops could also be a solution. The report points out that photosynthetic efficiency and respiration, which could affect water consumption, are complex traits might require the editing of hundreds of genes. Most genetically modified crops on the market today rely on the manipulation of a single gene. However, a number of agtech and biotech start-ups see gene editing technologies like CRISPR (clustered regularly-interspaced short palindromic repeat) as an opportunity to engineer crops with more complicated traits.
Water policy experts and investors have told Agri Investor the development of water markets could also play an important role in improving efficient use of water in agriculture.
“As soon as you ascribe a value to a unit of water, and you regulate the use of that water, the community will then appropriately use it for whatever attains the highest economic value,” Michael Blakeney, investment director at Blue Sky Investments told Agri Investor in November.
Blue Sky targets investments in Australia’s Murray Darling Basin, which is held up by many as an example of an effective water market in a drought-prone agricultural region.