So you think you have a cool app on your smart phone? Meet Gary Beck, an Idaho barley farmer who, from the comfort of his living room couch, can control giant irrigation systems miles away, turning sprinklers on and off or adjusting their spray.
Every drop counts. “Right now, we’re in a huge drought,” Beck says. “Some of the old timers have never seen it this dry before.”
Beck manages a farm that grows about 2,500 acres of barley for MillerCoors, the US’s second-largest beer company (behind Anheuser-Busch InBev), with revenues of nearly $9bn last year. His thorough water conservation efforts – including redesigning equipment, abandoning some fields and using more compost – have paid off big time, saving water, energy and money.
Even more notable, they have been guided – and partly financed – by his biggest customer, MillerCoors, with a nudge from its biggest customer, Walmart; by local utility Idaho Power, which wants to help its customers save energy; and by The Nature Conservancy, which owns the Silver Creek Preserve, a nearby high-desert fly-fishing destination that attracts an abundance of wildlife, including eagles, hawks, coyotes, bobcats and mountain lions – all of which, of course, need water.
It’s an example of how companies such as MillerCoors are reaching beyond their own boundaries to help solve environmental problems. It’s also illustrates a market failure: After all, competition ought to drive efficiency throughout the economy, but it hasn’t done so on barley farms – at least not until big business came along to kick-start the process.
How did all this come to pass? Water has long been a reputational issue for the beverage industry, leading the big beer companies to focus on the efficiency of their operations. MillerCoors has achieved an average water-to-beer ratio of 3.82 to 1 across its major breweries, according to its new sustainability report. Its rival AB InBev reportedly does better, with a water-to-beer production ratio of 3.5 to 1. Meanwhile, New Belgium, a craft brewery reputed to be an environmental leader, trails the big guys with a ratio of 4.2 to 1, according to its latest metrics.
More beer, less water
As it turns out, though, the brewing process accounts for only a small fraction of the water footprint of a six pack, as MillerCoors learned when it took a comprehensive look at the lifecycle impact of its beer. This broader review was prompted, at least in part, by Walmart, which has asked its major suppliers for full-fledged product lifecycle assessments as part of its supplier sustainability initiative.
MillerCoors found that about 90% of its water usage occurred on farms, says Kim Marotta, the company’s director of sustainability. Now the company is tracking its water footprint “from grain to glass,” Marotta says. “We needed to look outside of our four walls, and into our agricultural supply chain.”
Barley was the obvious place to start. As Marotta puts it: “Barley is to beer as wine is to grapes.” While many food and beverage companies contract for ingredients on commodity markets, MillerCoors has good visibility into its barley supply chain: It buys about 70% of its barley directly from about 850 growers, many of whom have long relationships with Bill and Pete Coors, the company’s patriarchs. So its farmers were ready to talk about water stewardship.
The trouble is, MillerCoors buys barley from farmers in four states – Idaho, Colorado, Wyoming and Montana – where water conditions differ. Stresses are most intense in the San Luis Valley of southeastern Colorado, as well as in the watersheds around Huntley, Montana, and Worland, Wyoming, Marotta told me. Besides that, she acknowledged: “We’re not farming experts.”
So MillerCoors decided to tap (pun intended!) the expertise of The Nature Conservancy, which owns about 900 acres of land in Idaho, some of which it leases to barley farmers. “We’re surrounded by barley farmers,” says Dayna Gross, who manages the Silver Creek Preserve. “One of our priorities is protecting ground water.” TNC did a watershed analysis and developed a set of best practices for water conservation.
The effort expanded in 2010 to what the company calls its “showcase farm,” the farm managed by Gary Beck and owned by longtime Coors’ suppliers John and Elizabeth Stevenson. They took a variety of steps, including adjusting irrigation pivots so that they spew less water in places where soil quality (and water retention) is high, lowering pivots so they drop water closer to the ground to reduce evaporation, using more compost so the soil retains moisture and eliminating pivot “end guns” that can spray water as far as 100 feet away.