Water as a Self-organizing Force in Agricultural Production and Trade: Past, Present, and Future

Water is a crucial factor in agricultural production. Still being mostly a free factor of agricultural production, water nevertheless becomes increasingly scarce in many parts of the world. This scarcity cannot be easily tracked based on the current data on the value of global trade in food and agricultural products, because the latter is dominated by high value-added commodities rather than those crucial for the survival of people and combating hunger (like wheat, rice, and other crops). Still, disproportions could be observed. Brazil, the world’s largest net exporter of agricultural products, enjoys a high water endowment, while China, the biggest importer of food, suffers from water scarcity. In the past, when agricultural trade was relatively small due to high transportation costs, local water endowment affected not only agricultural production but also the settlement of people. Thus, water is a self-organizing force in agricultural production and trade, and this chapter aims to analyze the evolution of this role of water. Water scarcity is growing across the globe. It is caused by population growth, deforestation, and climate change. It influences agricultural production and global trade in food and it is likely to gain importance in the future.