Punishing Droughts Put Fresh Pressure on Meat and Dairy Production

Droughts have hit countries around the globe from Spain to Syria this year and parts of the U.S., including farm-heavy North Carolina. Worries about increasingly high temperatures have investors wondering how farming businesses are dealing with water shortages.

Meat and dairy farms rely on water to hydrate their animals, grow crops to feed them and even to cool them off in extreme heat. Two-thirds of livestock companies surveyed by an investor group aren’t properly managing potential water shortages, “indicating widespread failure to manage water-related risks effectively,” according to a report published on Tuesday.

The report, by the Farm Animal Investment Risk and Return Initiative, a global investor network representing $80 trillion in assets, analyzed water risk for 60 large global meat, dairy and aquaculture companies. The FAIRR initiative provides investors with research on risk to the animal agriculture industry.