“Cannibal” is a fairly cutting insult to someone from Water Country, but only if it’s said by somebody from the same place. The other nations don’t understand it like you do.
But before we get into that we have to think about what that means in terms of the Naruto world. Would you say it extends to eating ANY sentient being, or just specifically other humans? What if you aren’t entirely human yourself, but just close enough? There’s plenty of creatures that can think and talk, that have identities and histories and lives separate from the human world. Take the toads for example. A toad the size of an ox could feed a village for a long long time. Maybe all winter if they were the smart sort who use every single piece of the animal. But it’s a talking ninja toad that wears clothes and everything, so how much of an animal do you consider it to be?
How hungry would you have to be to eat an animal that begged in words you could understand?
Then there’s the ‘humanity’ of the person doing the eating. Would you consider it cannibalism if Kisame ate a human? Was it cannibalism when his shark summons ate him? What about is a jinchuuriki ate someone? Would it matter if they had control of themselves at the time? Perhaps other nations ascribe the title of Cannibal to ‘any time a sentient humanoid being consumes another sentient humanoid being’.
Put all that aside and Water Country is still a place with a vicious wealth disparity. The rich stay rich but the poor can always get more poor. There’s not a lot of arable land for crops and the knowledge to farm in the first place is few and far between. Trade is the name of the game, having connections. It means doing things you would, under better circumstances, find deeply morally reprehensible, or turning a blind eye to those same things. All meat is mystery meat and if you’re fortunate enough to get a protein at all you don’t question it too much. Even fish meat could be from a talking fish, a magic fish, a mermaid. Living in Water Country below the poverty line means it’s entirely possible at some point you ate something that had once been able to talk.
But that doesn’t make you a cannibal.
Emergency situations then, you’re on a ship that’s been completely frozen over miles and miles and miles from any other people. (Again, depending on who you consider to be ‘people’) You’re out of provisions. The ship is the only shelter for a long way so you can’t leave, but the ice is too thick to break out of, and too deep to make a hole to fish through. Some of your crewmates die of frostbite or sickness or hopelessness. What do you do about it?
Even in that situation, most times you’d only be called a cannibal by people being assholes about it. Jerks trying to rile you up by poking at your sore spots. You wouldn’t be the first to survive something like that and be thrown right back into active duty.
So then, what is cannibalism in Water Country? There’s two conditions. One, you ate someone when you didn’t have to. It wasn’t about survival, it was about something else. Maybe you thought it was fun or maybe you were in a berserker rage and weren’t thinking anything at all. (It’s worth noting that if you’re in a berserker rage in combat and you eat an enemy it’s considered an honorable, or sometimes impressive act, depending on who it was.) Maybe you were high at the time.
So that’s rule one, it’s not being done for survival. The second part is about familiarity. The person you ate had been your family, or one of your squad mates. A spouse or a lover. Your own beast summon. You’ve done this terrible thing not out of need but out of some kind of selfishness to someone that was supposed to have your protection. That’s the part that matters most, right there. The familiarity and level of intimacy with the person you ate.
In this sense cannibalism is the considered one of the greatest taboos of Water Country. It’s not an accusation that gets thrown around lightly, not even by the rich and powerful.