(Bloomberg) — Food and beverage producers face rising costs that could curtail growth as water shortages and pollution become more severe, a group of investors warned in a new report.

Water scarcity is already impacting companies in drought-stricken regions such as California and Brazil, according to the report Thursday from Ceres, a Boston-based coalition of investors with more than $13 trillion in assets. While some producers are taking steps to manage water risks, most have fallen short, Ceres said.

"It definitely is a growing threat," Nick Martin, sustainability practice lead for Antea Group, an engineering and environmental consultant, said in an interview. "It's being taken a lot more seriously now than maybe it was 5 to 10 years ago."

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