ABSTRACT
The fundamental question about what conditions ensure sustainable water security must be understood having in mind the crucial nexus between water, energy and food production. Future water security will depend on the behaviour of several economic actors that interact mainly within the mechanism of international commodity markets. One of the common complaints about markets as allocation mechanism is their inability to correctly assess the sustainability of certain economic activities. The value of the water resources consumed to produce important staples, for instance, is not reflected in market prices, with the consequence of ignoring the risks related with an excessive use of water resources (Allan, 2011). Despite most of the virtual water included in food commodities remains within the national borders of the producers, an increasing portion is now being internationally traded, which has helped provide water security in regions in need but has not guaranteed its sustainability. On the other hand, a crucial role is played by consumer preferences with respect to water consumption, which is a function of demographic trends, food behaviour and diets. For all these reasons it becomes fundamental to understand how the very place of interactions among all these players actually work, and how its features have changed over time. Therefore, to fully understand the implications that the nexus has for current important global issues we cannot transcend from analysing the characteristics of international commodity markets.
