Water as a Commodity?

The oil price headed higher again yesterday. This time the excuse was violence in Nigeria following elections of dubious democratic merit. The fear is that the unrest may delay oil production in the Nigerian delta. The price of a barrel of Brent headed over $68, while in New York, it rose to more than $65 a barrel.
But vital though it may be, oil is not the most precious commodity. At this price, alternatives become much more viable. Everything from corn-based ethanol to engines that run on lard is being touted as the new petrol.

However, there’s one commodity for which there is no replacement at any price - water.

“The global water industry combines the best underlying business model with the most inexorable future demand of any existent industry, and this fundamental fact is not likely to change”, said an analyst.

Populations are growing rapidly. They are also moving en masse from country to cities. More people need more water - for food, drink and hygiene. Wealthier, urbanized people use more water. We use way more per head in the West than in developing countries - in the US, the population has grown by just 50% in the past 30 years, but water use has tripled.
Meanwhile, supply is finite, and we are polluting supplies and using them up faster than they can replenish themselves. Nowhere are these problems more obvious - or more pressing - than in China. China, the world’s next economic superpower, is also one of the 13 countries in the world with the lowest amount of water per head. The Chinese know they won’t get far on the world stage if most of their population is dying of thirst - so they’re looking to spend $128bn on the problem by 2010.

As another analyst says: “Any company that can help solve this China crisis is looking at a bright future.”

Cheers!