This posting is the first of a series examining the current state of China’s agricultural water sector. I look to see what challenges and opportunities agricultural water users face. This posting lays out the basic facts and figures for agricultural water use in the nation.
Massive growth in urban and industrial water use in the past decade increased competition over water resources, particularly in China’s arid northern plain. Industry, the second largest water user in China (after agriculture), comprised 23 percent of total water use in 2009. Over the past ten years, industrial water consumption as a percentage of all water use has increased steadily, from 113.9 bcm in 2000 to 139.1 bcm in 2009, at an annual growth rate of 2.5 percent. The municipal sector, although the smallest user as a percentage of total, increased the most dramatically during the nine-year time frame, by an annual growth rate of 3.3 percent, from 57.5 bcm in 2000 to 74.8 percent in 2009. Although allocations for agriculture have remained stable over the past 5 years, there is increasing concern over the agricultural sector’s ability to keep up production given sporadic and polluted water supply deliveries.
Figure 1 Water allocation per sector in China (2000 – 2009)
Source: National Bureau of Statistics (2010) China Statistical Yearbook 2009. Beijing, China.
China’s agricultural sector consumes the greatest share of China’s water resources, using around 62 percent of the total in 2009. The sector’s share has steadily declined since 2000, using 378.4 bcm in 2000 (68 percent), and 372.3 bcm (62.4 percent) in 2009. Although directing water to meet industrial and domestic demand is a higher value use in terms of economic output per unit of water, rising concerns over rural social cohesion and grain self sufficiency ensure that agriculture receives adequate apportionment.
Over the next five to ten years, allocations for agriculture will remain stable at about 62 percent of total supply as agricultural modernization efforts focus on ramping up the sector’s water-use efficiency. Efficiency gains will be driven by technical advancement, as there is little indication that the government will allow agricultural water prices to rise. Industrial and urban water users will also be under pressure to make do with their apportionments; even as industrial and urban sectors grow they will face mandated water use efficiency requirements and market-based incentives to conserve.
Presently, over 245 million households in China engage in small-plot farming, and rely on irrigation water to supplement rainfall for crops such as wheat, corn, rice, and cotton. Irrigation currently supports about 80 percent of China’s total agricultural output, with rice, vegetables and wheat accounting for 66 percent of irrigated crops. The agricultural sector’s high water use is driven in part by the nation’s overwhelming reliance on low-efficiency, traditional irrigation methods. Flood irrigation is still the main irrigation method in China. Farms using sprinkler and drip-irrigation technologies comprise a mere 5 percent of the irrigating farms producing wheat, corn, vegetables, and oil crops. [ 1]
Where surface water quantities fall short, farmers have resorted to exploiting groundwater resources. Chinese experts estimate that the past few decades have seen groundwater extraction increasing by about 2.5 billion cubic metres per year. At 19 million hectares, China has the largest area equipped for irrigation using groundwater, second only to India. Yet, groundwater sources are relatively finite and expensive to access as the water table falls, limiting this as a viable long-term water source.
Although recent droughts in central and southeast China have sparked concern over water supply nationwide, northern China’s water supply is particularly low, with per capita water supply estimated at 454 m3 [ 2] in 2009, far below the 1000m3 per capita threshold for acute scarcity. . Such shortages pose a threat to economic development and agricultural viability and are of great concern to policy makers concerned with maintaining China’s grain supplies. Due to shortages in both surface and groundwater supply, wide speculation exists as to whether northern China will have sufficient water to support agriculture in the long term.
In response to pressure on China’s agricultural sector to use less water– while continuing to sustain or increase crop yields– recent policy efforts have focused on increasing water use efficiency. The most recent Five Year Plan (FYP) includes an ambitious goal of achieving an irrigation utilization rate of 0.50, an 11 percent increase over the current rate (0.45), by the year 2020. However, despite widespread policies and initiatives to promote irrigation efficiency, and large investments in infrastructure to improve water distribution, China’s record in achieving water-use efficiency in agriculture remains poor.
It has been estimated that only 53 percent of water from main canals is actually delivered to the fields due to poor management of the nation’s canal network. Until water efficiency gains are realized at a national level, water supply shortages will remain a threat to agriculture. In the short term, those regions that transition quickly to water use efficiency will emerge as market leaders within the agricultural sector due to more profitable farms and less risk of crop failure due to water shortages. Gradually, farms throughout the nation will adopt water-saving technologies to hedge against drought and water shortages, but widespread adoption of such techniques will spread over ten to fifteen years.
 National Bureau of Statistics (2010) China Statistical Yearbook 2009. Beijing, China.
 McKinsey Global Institute (2009) “Charting Our Water Future” 2030 Water Resources Group: New York, pg. 58
 McKinsey&Company, From bread basket to dust bowl, November 2009.
 The Food and Agriculture Organisation, et al, Groundwater use for irrigation– a global inventory, 12 October 2010.
 Addressing China’s water scarcity: Recommendations for selected water resources management issues, World Bank, 2009.
 Cai, Ximing (2008) “water stress, water transfer and social equity in Northern China– Implications for policy reforms” Journal of Environmental Management 87 14-25