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Are virtual water "flows" in Spanish grain trade consistent with relative water scarcity?

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  • Novo, P.
  • Garrido, A.
  • Varela-Ortega, C.

Abstract

Virtual water adds a new dimension to international trade, and brings along a new perspective about water scarcity and water resource management. Most virtual water literature has focused on quantifying virtual water "flows" and on its application to ensure water and food security. Nevertheless, the analysis of the potential gains from international trade, at least from a water resources perspective, needs to take into account both spatial and temporal variations of blue (groundwater and stream flow) and green (soil moisture) water, as well as the socioeconomic and policy conditions. This paper evaluates whether Spanish international trade with grains is consistent with relative water scarcity. For this purpose, the study estimates the volume and economic value of virtual water "flow" through international grain trade for the period 1997-2005, which includes 3years with different rainfall levels. The calculations show that Spain is a net virtual water "importer" through international grain trade. The volume of net virtual water "imports" amounts to 3420, 4383 and 8415million m3 in wet (1997), medium (1999) and dry (2005) years, respectively. Valuing blue water at its shadow price or scarcity value, blue water "exports" oscillate between 0.7 and 34.2million Euros for a wet and dry year, respectively. Overall, grain trade is apparently consistent with relative water scarcity as net imports increase in dry years. However, the evolution of grain exports, expressed as a variation in quantity and volume, does not match the variations in resource scarcity. A disaggregated crop analysis reveals that there are other factors, such as quality, product specialization or the demand for a standardized product, which also influence trade decisions and are not included in the notion of virtual water. These facts, among others, can therefore create potential distortions in the application of virtual water to the analysis of specific trade patterns. Nevertheless, from a water resources perspective, virtual water can bring important insights across countries for improving water and land management globally, fostering adaptation strategies to climate change and to transboundary resource management.

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  • Novo, P. & Garrido, A. & Varela-Ortega, C., 2009. "Are virtual water "flows" in Spanish grain trade consistent with relative water scarcity?," Ecological Economics, Elsevier, vol. 68(5), pages 1454-1464, March.
    • Handle: RePEc:eee:ecolec:v:68:y:2009:i:5:p:1454-1464
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    Cited by:

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    2. Huang, Feng & Li, Baoguo, 2010. "Assessing grain crop water productivity of China using a hydro-model-coupled-statistics approach: Part I: Method development and validation," Agricultural Water Management, Elsevier, vol. 97(7), pages 1077-1092, July.
    3. Marta Antonelli & Martina Sartori, 2014. "Unfolding the Potential of the Virtual Water Concept. What is still under debate?," IEFE Working Papers 74, IEFE, Center for Research on Energy and Environmental Economics and Policy, Universita' Bocconi, Milano, Italy.
    4. Zhaodan Wu & Yi Zhang & Yu Hua & Quanliang Ye & Lixiao Xu & Shiqi Wang, 2020. "An Improved System Dynamics Model to Evaluate Regional Water Scarcity from a Virtual Water Perspective: A Case Study of Henan Province, China," Sustainability, MDPI, vol. 12(18), pages 1-35, September.
    5. Fracasso, Andrea, 2014. "A gravity model of virtual water trade," Ecological Economics, Elsevier, vol. 108(C), pages 215-228.
    6. Abdeslam Boudhar & Said Boudhar & Mohamed Oudgou & Aomar Ibourk, 2023. "Assessment of Virtual Water Flows in Morocco’s Foreign Trade of Crop Products," Resources, MDPI, vol. 12(4), pages 1-23, April.
    7. Yu Zhang & Jin-he Zhang & Qing Tian, 2021. "Virtual Water Trade in the Service Sector: China’s Inbound Tourism as a Case Study," IJERPH, MDPI, vol. 18(4), pages 1-20, February.
    8. Esther Velázquez & Cristina Madrid & María Beltrán, 2011. "Rethinking the Concepts of Virtual Water and Water Footprint in Relation to the Production–Consumption Binomial and the Water–Energy Nexus," Water Resources Management: An International Journal, Published for the European Water Resources Association (EWRA), Springer;European Water Resources Association (EWRA), vol. 25(2), pages 743-761, January.
    9. Saida Elfkih & Olfa Hadiji & Saker Ben Abdallah & Olfa Boussadia, 2023. "Water Accounting for Food Security: Virtual Water and Water Productivity in the Case of Tunisian Olive Oil Value Chain," Agriculture, MDPI, vol. 13(6), pages 1-16, June.
    10. Angela Cheptea & Catherine Laroche-Dupraz, 2019. "Is irrigation driven by the economic value of internationally traded agricultural products?," Working Papers hal-02154603, HAL.
    11. Dennis Wichelns, 2010. "Virtual Water: A Helpful Perspective, but not a Sufficient Policy Criterion," Water Resources Management: An International Journal, Published for the European Water Resources Association (EWRA), Springer;European Water Resources Association (EWRA), vol. 24(10), pages 2203-2219, August.
    12. Andrea Fracasso & Martina Sartori & Stefano Schiavo, 2014. "Determinants of Virtual Water Flows in the Mediterranean," IEFE Working Papers 75, IEFE, Center for Research on Energy and Environmental Economics and Policy, Universita' Bocconi, Milano, Italy.
    13. Fabien Martinez, 2015. "A Three-Dimensional Conceptual Framework of Corporate Water Responsibility," Post-Print hal-02887624, HAL.
    14. Roberto Roson & Martina Sartori, 2013. "Trade-offs in water policy: System-wide implications of changing water availability and agricultural productivity in the Mediterranean economies by 2050," Working Papers 2013:21, Department of Economics, University of Venice "Ca' Foscari".
    15. Mubako, Stanley & Lahiri, Sajal & Lant, Christopher, 2013. "Input–output analysis of virtual water transfers: Case study of California and Illinois," Ecological Economics, Elsevier, vol. 93(C), pages 230-238.
    16. Ansink, Erik, 2010. "Refuting two claims about virtual water trade," Ecological Economics, Elsevier, vol. 69(10), pages 2027-2032, August.
    17. Chen, Rui & Wilson, Norbert L.W., 2017. "Virtual Water Trade: Do Bilateral Tariffs Matter?," 2017 Annual Meeting, July 30-August 1, Chicago, Illinois 258279, Agricultural and Applied Economics Association.
    18. Catherine Laroche-Dupraz & Angela Cheptea, 2021. "Is irrigation driven by the price of internationally traded agricultural products?," Post-Print hal-03227465, HAL.
    19. Delbourg, Esther & Dinar, Shlomi, 2020. "The globalization of virtual water flows: Explaining trade patterns of a scarce resource," World Development, Elsevier, vol. 131(C).

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