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Investor Relations

Water

Water plays a crucial role in global food security and is essential for the resilience of Olam’s international agri-supply chains. Water scarcity is already an issue in many world regions. Successful companies of the future will be those which plan ongoing operations and investments with water at the centre – costing it into their business plans, modelling future availability and collaborating with local stakeholders for equitable access and usage.

Key 2016 focus areas

  • Mapping exposure to water stress
  • Supporting smallholders vulnerable to water scarcity
  • Implementing processing plant improvement plans

Key sector collaborations and commitments

  • Appointed to the Board and Technical Committee of the Alliance for Water Stewardship
  • Member of UN CEO Water Mandate and California Water Action Collaborative
  • Completed 4th year Carbon Disclosure Project (CDP) Water Module: B- (Ind ave: C)

We are guided by

In this section we cover:

FY16 value chain water footprint

Mapping our wider water risks

In 2016, we mapped our exposure to current water stress. Using the World Resources Institute Aqueduct risk mapping tool, we screened OLC programmes, our upstream farming and plantations operations and our secondary processing facilities. This enables us to implement enhanced water management and water stewardship approaches. Globally, we aim to implement the Alliance for Water Stewardship Standard at all processing sites and their supply chains in medium to extremely high water risk locations, and continue to manage low to medium risk sites through ISO 14001.

Helping smallholders reduce water while improving yields

Although many smallholder crops are naturally rain fed such as cocoa and cotton, others such as rice and sugar are renowned for water consumption, either because they are thirsty or because water is used liberally in production methods. And with weather impacts (either from climate change or (El Nino) bringing much drier weather in certain areas in 2016, the rain fed crops require extra moisture.

Water risk screening of top tier processing and manufacturing plants using the World Resources Institute Aqueduct Water Risk Atlas tool

Water reduction in India sugarcane production

In India, cultivating 1 kg of sugar cane can require between 1,500 and 3,000 litres of water. With the support of partners IFC, Hindustan Unilever Foundation, Solidaridad and New Holland, Olam’s smallholder OLC programme in Maharastra and Madhya Pradesh, which began in 2013, has reached around 20,500 farmers across 22,500 ha of land. Overall productivity has increased by 15% while thanks to water stewardship programmes, about 62 billion litres have been saved (water avoidance) over 3 years. In 2016, the initiative was awarded the Most Notable Project of the Year by the Confederation of Indian Industry.

Ensuring our operations do not impact on the water security of others, Olam is the first agri-business globally to achieve AWS certification

In 2016, our Aviv coffee plantation in southern Tanzania became the first agri-business site in the world to achieve Alliance for Water Stewardship (AWS) certification. This strengthened our existing efforts to adhere to global best practice in collaborative water management, and helped to ensure long-term water security for the 300,000 people living in the Ruvuma River Basin.

With the assistance of Water Witness International, the International Water Stewardship Programme (IWaSP), GIZ and SGS, we have worked in partnership with water users including communities in the Ruvuma River Basin. Collaboratively, we developed a scenario plan for extreme weather events such as droughts, ensuring the fair use of water in times of scarcity or water stress. The process helped increase transparency, providing added reassurance on quality and water‑footprinting for customers. Additionally, we provided further Water, Hygiene and Sanitation (WASH) facilities for coffee plantation workers.

Precision irrigation through cutting edge technology

In our almond orchards in the USA and Australia, technology helps us monitor plant health and needs in real-time, enabling optimum irrigation efficiency. In 2016, this technology helped to reduce water use by up to 10% while maximising growth rate and maintaining non-stress conditions for the tree.

We use Phytech Plantbeat technology which combines sensor hardware installed in the field with data analysis and algorithms to predict exact irrigation requirements across the farm, up to 5 days in advance. Instead of having to wait to see water stress impacting the tree, we can irrigate at the first sign of stress, thus protecting the tree and improving water efficiency.

Minimising water in California processing

At our Lemoore tomato processing plant:

  • 584,830 metric tonnes of tomatoes produce 92,942 metric tonnes of tomato paste and 56,831 metric tonnes of diced tomato per season
  • This requires about 596,744,593 litres of water per year
  • During the paste evaporation process, 6,042,658 litres of water a day are removed from the tomatoes, and used in the factory to reduce demand for further water inputs
  • A closed-loop condensate return and cooling system reduces water and energy consumption
  • This water is discharged to Westlake Farms and used to grow alfalfa
  • Zero landfill for food waste – all tomato pomace and vine material is received by Gilton Resource Recovery.

Improving wastewater management for farms and factories

In our farms and plantations, water can run off the surface of the land, washing away valuable top soil, nutrients, fertilisers and insecticide, which in turn can then impact on the quality of nearby watercourses. We incorporate all activities that could affect wastewater quality into our Integrated Water Resource Management plans and our Soil Management plans.

In our plantations, we use remote sensing, sophisticated modelling and ground surveys to map streams, rivers and seasonal wetlands, which we protect with a system of interconnected buffer zones.

In our factories we have wastewater quality standards for the water we discharge. It goes without saying that all Olam locations must comply with their legal licence to operate. In 2016, we did not receive any environmental fines for water management.

The full report is available to download here.

1 AWS – Alliance for Water Stewardship.