Reports from long shipping delays for ships transiting the Panama Canal this yr have highlighted the crucial but often neglected role that freshwater plays in global supply chains. Panama is experiencing drier than normal conditions on account of El Niño left the drought-stricken region and the water level within the locks feeding the canal is lower than usual. This led to fewer ships having the ability to go through the canal every day: only 31 ships now in comparison with 36-38 under normal conditions. This means longer waits for products to maneuver through the channel and onto store shelves.
The slowdown within the Panama Canal shows how access to fresh water is crucial to how goods are made and shipped. influencing the whole lot from grocery prices to retail forecasts for the upcoming holiday shopping season. How professor of supply chain managementI feel it will be clever for firms to pay more attention to this issue.
But first, you might ask: what does freshwater should do with ocean freight? It seems a lot.
Water, water in every single place and not enough to share
The Panama Canal is a freshwater connection between two oceans, not a saltwater connection as you may assume. A series of locks on either side of the canal raise freighters nearly 100 feet into artificial lakes stretching across the Isthmus of Panama and lower them to sea level on the opposite side.
Each passage of the ship requires 52 million gallons fresh water from the lakes, rivers and streams on this small country. This creates a trade-off between saving water for local needs and using it to enable ships to go through the canal. Less water allocated to the canal means fewer ships can go through it.
This is not an isolated phenomenon. Periodic low water levels in Mississippi River and Rhine River in Germany have been hampering barge traffic for years, disrupting supply chains while fueling debate over the allocation of limited amounts of fresh water. The latest community plans in northern Colorado construct your individual tanks on Colorado River tributaries draw attention to questions on who owns access to local waterways and how this resource is managed.
An ancient challenge
The need to administer water resources is nothing recent, as water management systems are complex dates back to the times of the Roman Empire AND even earlier. Over the centuries, humanity has made great progress in water management, but lately the difficulty has often taken a backseat to other pressing environmental issues resembling global warming.
Water management is complicated by the proven fact that businesses and communities sometimes find themselves in conflict: businesses need to use water for their operations, while communities need to protect water resources to be certain that the fundamental needs of residents are met. At the identical time, communities also need jobs and services provided by businesses. Examples resembling the Panama Canal highlight this tension.
Balancing these seemingly conflicting needs requires a deeper examination of how much water is used to supply the products that folks buy and use each day.
As my colleagues and I showed in a recent journal article: water is a very important ingredient almost the whole lot people buy. For example, kind of 2,600 liters of water produces material for one pair of jeans. From growing cotton for the fibers it needs, to producing jeans and putting those jeans on the shelves at The Gap, as steam moves through the supply chain, more and more water enters each pair.
Basically, firms use water to move the water contained in virtually all of the products they sell. That’s why firms have greater than purely altruistic reasons to resolve water problems: it isn’t only good for society, but in addition for their very own business. Water shortages can hamper production and disrupt the supply chains on which businesses rely.
Enterprise solutions
There are some ways businesses can improve their water management to cut back their very own consumption – and costs – while reducing their exposure to water-related hazards.
First, firms should realize that not the whole lot requires clean water. Wastewater from one process will be utilized in one other that doesn’t require clean water. Similarly, not every process pollutes water, so reusing wastewater from these processes, resembling water used for cooling, is easy.
Second, firms can share wastewater between facilities for reuse, a concept called industrial ecology. For example, nutrient-rich water from food production will be used to irrigate farms as a substitute of being discharged.
And third, because water is a superb medium for heat transfer, as a substitute of attempting to cool one area and heat one other, firms can mix systems. For example, global aluminum giant Novelis uses the recent water utilized in the casting process at considered one of its plants in Europe heat the neighboring constructing.
There are many opportunities to enhance management of freshwater – considered one of our most precious resources. While tighter government regulation and expanded reporting requirements will help, decisions made by firms themselves could move the needle even further.
Those who achieve this will definitely profit from their position within the communities by which they operate – as will their profits.
