Regenerative farming must triple its rate of growth to deliver against the world’s need to limit climate change to 1.5 degrees. Research by Systemiq for the Sustainable Markets Initiative (SMI) showed that regenerative farming needs to make up at least 40% of global cropland by 2030, up from around 15% today.
Many food businesses are adopting regenerative approaches within their supply chains as part of their net-zero commitments. However, rates of adoption are not fast enough, said SMI’s agribusiness task force in a new report.
Three key barriers to adoption were identified: the short-term economic case is not compelling enough for the average farmer; there is a knowledge gap in how to implement regenerative farming; and drivers in the value chain aren’t aligned to encourage regenerative farming.
The biggest constraint is economic, the task force concluded. “Farmers are rational business people,” the report reads. “They farm the way they do as a result of the market dynamics we have created through the food system. As leaders of companies that play a key role in that system, we can alter those dynamics in such a way that more farmers can and will want to farm in a more sustainable way.”
Those to have signed the report include Bayer, Mars, McDonald’s, Olam, PepsiCo, the Sustainable Food Trust and Waitrose. They admitted that a “shift in mindset” is needed, from focusing on what the farmer needs to do to what their companies can do to make it easier and more attractive to adopt regenerative farming.
They also said it’s not worth wasting timing debating a narrow definition of regenerative agriculture. “[…] energy will be better spent agreeing common [environmental] outcome metrics” to be used by the whole food system, they said. Finance and insurance should also be provided to farmers on “terms that decrease the financial burden of transitioning to and maintaining a regenerative system”.
Some research has showed yields can fall in the initial years following this transition, for example. Farmers are mindful of this, and the noises made by some of the big food companies suggest they are too. Tesco has been working with Santander and Anthesis, a consultancy, on a new sustainability-linked supply chain finance product that gives suppliers preferential financing rates based on their disclosure of emissions, setting of reduction targets and delivering on them.
Industry can’t do this alone, however. There also needs to be targeted government policy and an overhaul of food sourcing – all of which will help make regenerative agriculture a ‘no brainer’ business decision for farmers, the task force said.
