World-wide there is an enormous challenge to produce almost 50% more food up to 2030, and double production by 2050. This will probably have to be achieved with less water, mainly because of pressures from growing urbanisation, industrialisation and climate change. Consequently it will be important in future that farmers face the right signals to increase water use efficiency and improve water management, especially as agriculture is the major user of water, accounting for about 70% of the world’s freshwater withdrawals and over 40% of OECD countries’ total water withdrawals.

Until the 1980s, water resource management in agriculture in most OECD countries focused on the physical supply of water. Emphasis was on infrastructure “supply-side” technical solutions and harvesting the maximum amount from the resource. This technical-based path to water resource management is now being complemented with the accent on sustainable based water resource management and greater reliance on “demandside” economic solutions. A turning point in this shift in the policy agenda was the Dublin International Conference on Water in 1992, where it was stressed that “managing water as an economic good is an important way of achieving efficient and equitable use, and of encouraging conservation and protection of water resources”.

Water serves a range of productive, environmental and social purposes in the agricultural sector and wider economy. Governments, water managers and consumers/users have a role to ensure that mechanisms and actions are in place to make certain that water is allocated and used to achieve socially and economically beneficial and efficient outcomes in a manner that is environmentally effective and sustainable. But management of water resources in agriculture is being severely tested with rising food and energy prices, growing competition for water resources between different users, an expanding global population, and concerns related to climate change.

There is a high level of diversity in hydrological conditions and farming systems operating in a greatly varying set of political, cultural legal and institutional contexts, both across and within OECD countries. Management of water resources in agriculture includes a spectrum of options (Figure 1.1). These include totally rain-fed dependent farming systems, where on-farm conservation practices focus on storing water in the soil. As climatic conditions become drier and dry season shortages more frequent (moving from left to right along the spectrum in Figure 1.1), increasing use is made of supplemental surface water and groundwater sources to enhance crop production, and in some cases other water sources (e.g. recycled wastewater and desalinated water).

The key trends in OECD agriculture’s use of water resources since 1990, include: • Use of freshwater resources by agriculture and non-agricultural users has changed little; • Agriculture accounts for the major share of total water use; • The area irrigated has been increasing, while the total agricultural land area has decreased; and, • Abstractions from groundwater resources by agriculture have been increasing.

All OECD countries have policy strategies to address broad water management issues – water resources, quality and ecosystems – and in terms of the more specific objectives for managing water resources in agriculture they broadly share a common strategic vision to: • Establish a long-term plan for the sustainable management of water resources in agriculture taking into account climate change impacts, including protection from flood and drought risks; • Contribute to raising agricultural incomes and achieving broader rural development goals; • Protect ecosystems on agricultural land or affected by farming activities; • Balance consumptive water uses across the economy with environmental needs; and, • Improve water resource use efficiency, management and technologies on-farm and ensure the financing to maintain and upgrade the infrastructure supplying water to farms (and other users).

This document, An Economic Analysis of the Virtual Water Concept in Relation to the Agri-food Sector, by Dennis Wichelns, of Hanover College, Indiana, is one of the background reports supporting the OECD study (2010) Sustainable Management of Water Resources in Agriculture.

This document, Agriculture's Role in Flood Adaptation and Mitigation: Policy Issues and Approaches, by Joe Morris, Tim Hess and Helena Posthumus, of Cranfield University, Bedfordshire, United Kingdom, is one of the background reports supporting the OECD study (2010) Sustainable Management of Water Resources in Agriculture.

This document, Environmental Effectiveness and Economic Efficiency of Water Use in Agriculture: The Experience of and Lessons from the Australian Water Reform Programme, by Michael D. Young, of The University of Adelaide, Australia, is one of the background reports supporting the OECD study (2010) Sustainable Management of Water Resources in Agriculture.

This document, Financing Water Management and Infrastructure related to Agriculture across OECD Countries, by Frank A. Ward, of New Mexico State University, Las Cruces, United States, is one of the background reports supporting the OECD study (2010) Sustainable Management of Water Resources in Agriculture.

This document, Agricultural Water Pricing: EU and Mexico, by Alberto Garrido of the Universidad Politécnica de Madrid, and Javier Calatrava, of the Universidad Politécnica de Cartagena, Spain, is one of the background reports supporting the OECD study (2010) Sustainable Management of Water Resources in Agriculture.

This document, Agricultural Water Pricing in Japan and Korea, by James E. Nickum and Chisa Ogura, of the Japan Office of the Asian Water and Resources Institute, is one of the background reports supporting the OECD study (2010) Sustainable Management of Water Resources in Agriculture.

This document, Agricultural Water Pricing: Turkey, by Erol H. Cakmak, of the Middle East Technical University in Ankara, is one of the background reports supporting the OECD study (2010) Sustainable Management of Water Resources in Agriculture.

This document, Agricultural Water Pricing: Australia, by Seamus Parker, Council of Mayors (South- East Queensland) and Robert Speed, Freelance Consultant, Brisbane, Australia, is one of the background reports supporting the OECD study (2010) Sustainable Management of Water Resources in Agriculture.

This document, Agricultural Water Pricing: United States, by Dennis Wichelns, of Hanover College, Indiana, is one of the background reports supporting the OECD study (2010) Sustainable Management of Water Resources in Agriculture.