Virtual water

Virtual water (also known as embedded water, embodied water, or hidden water) refers, in the context of trade, to the water used in the production of a good or service. For instance, it takes 1,300 cubic meters of water on average to produce one metric tonne of wheat. The precise volume can be more or less depending on climatic conditions and agricultural practice. Hoekstra and Chapagain have defined the virtual-water content of a product (a commodity, good or service) as "the volume of freshwater used to produce the product, measured at the place where the product was actually produced". It refers to the sum of the water use in the various steps of the production chain.

Professor John Anthony Allan from King’s College London and the School of Oriental and African Studies was the creator of the virtual water concept, which measures how water is embedded in the production and trade of food and consumer products. For his contributions he was awarded the 2008 Stockholm Water Prize. In his awarding, the Stockholm International Water Institute (SIWI) stated that "Virtual water has major impacts on global trade policy and research, especially in water-scarce regions, and has redefined discourse in water policy and management. By explaining how and why nations such as the US, Argentina and Brazil ‘export’ billions of litres of water each year, while others like Japan, Egypt and Italy ‘import’ billions, the virtual water concept has opened the door to more productive water use."

Allan (2005) stated: "The water is said to be virtual because once the wheat is grown, the real water used to grow it is no longer actually contained in the wheat. The concept of virtual water helps us realize how much water is needed to produce different goods and services. In semi-arid and arid areas, knowing the virtual water value of a good or service can be useful towards determining how best to use the scarce water available."

There are, however, significant deficiencies with the concept of virtual water that mean there is a significant risk in relying on these measures to guide policy conclusions. Accordingly, Australia's National Water Commission considers that the measurement of virtual water has little practical value in decision making regarding the best allocation of scarce water resources.

Agricultural products

It is essential to recognize that virtual water is cumulative. To produce one kilogram of wheat about 1000 liters of water are needed, but for beef about 15 times as much is required. The majority of the water that we consume is embedded in food:

• the production of 1 kg wheat costs 1,300 L water
• the production of 1 kg eggs costs 3,300 L water
• the production of 1 kg broken rice costs 3,400 L water
• the production of 1 kg beef costs 15,500 L water

Household products

Not only is there virtual water in food, but it is in various products in common use:

• Jeans (1000g) contain 10,850 liters of embedded virtual water
• A cotton shirt (medium sized, 500 gram) contains 4,100 liters of water
• A disposable diaper (75g) contains 810 liters of water
• A bed sheet (900g) contains 9,750 liters of water

Industrial products

Industrial goods also contain embodied water. One needs to understand how internal water resources are being used to produce cars, bicycles, teacups, and the like - particularly because industry usually uses only blue water for production (though rainwater harvesting is becoming more common). On average, a 1.1 tonne passenger car has about 400,000 liters of water embedded in it. This fact is compiled from several different resources including the UNESCO-IHE study and the Australian Food & Grocery 2003. Another source suggests Australian cars require one million litres of water, though this is from using a different method. The construction of a house, using a combination of methods, requires about 6 million litres of water.