Use regenerative practices to reduce agricultural emissions

The global food system is responsible for 26% of global emissions (1). Approximately 5 billion hectares are used as agricultural land globally, or 38% of the global land surface (2). Every year, 6 million hectares of forestland and 7 million hectares of other land is converted for agricultural use (3). This growth in agriculture is putting pressure on the environment and depleting natural resources.

However, agriculture can also be the biggest solution to its own problem. According to the IPCC, the Agriculture, Forestry and Other Land Use (AFOLU) sector can provide 20-30% of the global mitigation needed to limit warming to 1.5°C (4). This global transformation of food systems can be driven by a transition to regenerative agriculture, along with other actions, like implementing other nature-based solutions and switching to alternative proteins.

The adoption of regenerative agriculture at the farm level can contribute to improving farm resilience, reducing farming costs, increasing farmers’ profitability, and enhancing local and regional food security, leading to climate and nature benefits.

Agriculture-related emissions reductions are essential to reaching global net zero by 2050, and regenerative agriculture can be among the top contributors in this sector (5). Estimates of the reduction potential of regenerative agriculture vary, with some claiming that nine gigatons of CO2 could be sequestered through these practices, or ~20% of all annual anthropogenic emissions, while others express strong disagreement, suggesting a far more limited ability to reduce atmospheric carbon (6).

Regenerative agriculture is a farming management system based on principles and practices that generate agricultural products while regenerating ecological processes and providing sustainable livelihoods to farmers. These practices are implemented by farmers, but, importantly, can be incentivized by any company that procures products from agricultural businesses.

Regenerative agriculture – with the concepts of soil health and ecosystem restoration at its heart, and leveraging agroecological knowledge and innovative technologies – can be considered a nature-based solution. It is a holistic farming approach that considers the interconnection of all components of a farming system (including livestock, dairy, annual crops, and perennial crops like olives and asparagus). It is based on the following specific principles:

• Promoting above- and below-ground carbon sequestration

• Reducing GHG emissions

• Protecting and enhancing biodiversity in and around farms

• Improving water retention in the soil

• Reducing the use of pesticides

• Improving nutrient use efficiency

• Supporting farming livelihoods

Since regenerative agriculture is a systemic approach, its principles are not to be taken individually. The ambition of this farming approach is to find a balance between the different outcomes, adapting to differences in soil culture, landscapes, pedoclimatic conditions (i), and farm structure. Additional principles may apply for specific farming systems, such as animal welfare for livestock and dairy farming. Regeneration requires a holistic shift, integrating farming practices that positively affect the climate, biodiversity, soil, water, and farmers' livelihoods.

Figure 1: Regenerative agriculture involves a range of actions that drive environmental and livelihood outcomes

Source: BCG, OP2B, WBCSD. Cultivating farmer prosperity: Investing in Regenerative Agriculture (7)

CPG companies: Globally, many CPG companies want to transition their suppliers to regenerative agriculture. For example, General Mills has launched a series of pilots to observe how regenerative farming functions compare to conventional methods and has committed to using regenerative agriculture on 1 million acres of land by 2030 (8). Danone has defined regenerative best practices and created guidance for implementation for its farmer partners. Danone France has committed to using regenerative agriculture to source 100% of ingredients by 2025 (9). Similar commitments have been made by Kellogg’s, Mars, Nestlé, and many others.

Clothing and textile manufacturers: Clothing and textile manufacturers can benefit from regenerative agriculture due to their agricultural inputs. For example, Kering, the owner of Gucci and Yves Saint Laurent, started the Regenerative Fund for Nature, which aims to transform 1 million hectares of land to regenerative agricultural spaces (10). Additionally, the New Zealand Merino Company has created the first platform for 100% regenerative wool, and both North Face and Patagonia are dedicated to increasing the use of regenerative cotton (11).

Climate impact

Targeted emissions sources

Scope 1 (farm owners): Avoided emissions from direct activities, fertilizer use, and crops.

Scope 2 (farm owners): Reductions in energy and heat usage as processes become more efficient.

Scope 3 (companies purchasing agricultural products):

• Category 1 (Purchased goods and services)

• Category 3 (Fuel- and energy-related activities not included in scope 1 or scope 2)

Decarbonization impact

Regenerative practices can both reduce GHG emissions associated with farming activities (abatement) and store atmospheric CO2 as soil organic carbon (sequestration). Some studies have found that regenerative practices can decrease a farm’s GHG emissions by 50% compared to conventional farming (12) As mentioned above, there is scientific debate around the full potential of regenerative agriculture in reducing global GHG emissions (13).

Business impact

Benefits

The transition to regenerative agriculture can also generate sustained competitive advantages, such as improved supply chain resilience (e.g., reduced dependence on external inputs like fertilizers), lower costs of inputs, higher yields, and improved efficiency. There is also a real "first mover advantage" in the transition to regenerative agriculture, with early movers having priority access to scarce sustainable inputs.

Costs

• Impact on operating costs: Operating costs are likely to increase initially but are also likely to return to previous (normalized) levels or lower in a few years. Regenerative agriculture can increase profitability after 3-5 years (14). However, farmers could face significant early financial risk and may require transition support (ideally from companies).

  Investment required: The cost of regenerative agriculture practices can vary depending on regional differences and the specific practices implemented. Investments in additional land, specialized equipment, farmer training, and certifications may be required.

  Subsidies used: Regional and country-specific subsidies apply.

  Other dependencies: Cost is mostly dependent on local factors, like sustainable input costs, specialized equipment availability, etc.

Indicative abatement cost

A brief selection of regenerative agriculture practices with indicative abatement costs follows below:

• Employing conservation agriculture, which uses minimal mechanical soil disturbance, permanent soil organic cover, and species diversification, to increase water and nutrient efficiency, decreasing water use and fertilizer-based emissions: ~<€20/tCO2e

• Using silvopasture, the practice of integrating trees, forage, and grazing on the same land, which reduces water use and emissions from fertilizers: ~<€20/tCO2e

• Using intercropping, the practice of cultivating multiple crops simultaneously on the same land, which reduces emissions from fertilizers: <~€20/tCO2e

• Growing seaweed to sequester carbon and reduce emissions from livestock feed: ~€30-50/tCO2e

• Blending biochar into soil to improve water and nutrient retention, decreasing water use and fertilizer emissions: ~€60-80/tCO2e

Impact beyond climate and business

Co-benefits

• Enhancements in overall biodiversity through agroforestry and other practices.

• Improved water quality through diminished erosion, runoff, and risk of flooding.

• Improved farmer livelihoods through enhanced cropland and grazing land productivity, increasing yields and reducing input costs.

Typical business profile

Regenerative agricultural processes can benefit agricultural commodity producers, CPG food brands, food retailers, the restaurant industry, organic textiles, and fashion businesses. Food and beverage companies that source agricultural ingredients consider regenerative agriculture a critical part of the toolkit to decarbonize their supply chains and address Scope 3 (upstream) emissions. Fashion companies are also considering the emissions from these inputs and have committed to implementing regenerative practices in their supply chains. Additional industries that might use regenerative agricultural practices include tobacco and healthcare.

Approach

1. Assess emissions: Conduct a comprehensive assessment to understand the emissions and environmental footprint of agricultural operations, focusing on identifying the major products that contribute most to emissions.

2. Prioritize practices: Evaluate different crops based on their suitability for regenerative agriculture practices, prioritizing those where implementation is feasible and likely to have the greatest positive impact.

3. Implement solutions: Develop a regenerative agriculture framework tailored to the specific needs and conditions of the prioritized crops. This framework should include a set of practices based on the regenerative agriculture principles described earlier. Rely on existing regenerative agriculture frameworks and established institutions, as well as strategic partnerships.

   1. Collaborate with suppliers: Implement procurement standards and incentivize suppliers, including seed companies, fertilizer providers, and equipment manufacturers; ensure the availability and accessibility of regenerative agriculture inputs and technologies.

   2. Engage directly with farmers: Influence the widespread adoption of regenerative agriculture practices; develop partnerships that involve co-investment in research, infrastructure development, and farmer education; incentivize farmers through technical training, generalized climate education, and financial aid.

   3. Provide training: Distribute resources to farmers to ensure proper implementation of these practices and monitor progress through regular assessments.

Stakeholders involved

An array of internal stakeholders must be involved to transition to regenerative agriculture:

• Executive Management: To set goals and decide how to invest and/or incentivize regenerative efforts.

• Product Development: To adjust product design to make best use of outputs from regenerative sources.

• Farm Suppliers: To implement regenerative practices first-hand.

• Sustainability Team: To conceptualize, develop, and communicate strategies for implementing regenerative practices, and to provide technical expertise.

• Marketing: To develop marketing campaigns that target customers’ desire to support sustainability efforts and farmers.

Key parameters to consider

Solution maturity

The extensive implementation of regenerative agriculture is a relatively new approach to farming. However, many common regenerative practices are being tried and tested and are gaining popularity as more sustainable ways to produce food. These practices are generally regarded as effective in improving soil health, reducing greenhouse gas emissions, and increasing biodiversity.

Technical constraints or pre-requisites

The ability to design a new model to scale regenerative agriculture (tailored by crop and geography), data collection systems, financing the transition, and engaging with stakeholders to influence farming practices.

Implementation and operations tips

From the perspective of a company purchasing agricultural products from suppliers, there are a few implementation tips to consider:

Prioritize regenerative agriculture principles: Take a system change approach to scaling regenerative agriculture and prioritize practices that address their own sustainability goals. Strategies can align with Science-Based Targets more broadly, the goals of the EU’s Farm to Fork strategy, or other regional or global ambitions. Purchasing companies must ensure and support the implementation of these practices across their supply chains.

Create a region-specific strategy: Design and activate a transformation roadmap grounded in local/regional agronomic and economic feasibility. Ensure the flexibility of strategy and operations, piloting, testing, learning, and scaling with farmers.

Establish measurement: Establish a clear measuring, reporting, and verification system. The outcomes derived from regenerative agricultural systems can be measured using a combination of relevant KPIs (e.g., soil carbon content, percentage of semi-natural habitats, [specific indicators in the Read more section]).

Give farmers transition support: Provide financing and activate ground-level partnerships to implement regenerative practices. To assess progress, regular measurement and monitoring will be required. Farmers should be supported in measuring outcomes with necessary training on methodology and documentation at the farm level. It will also require long-term follow up (e.g., ~5 years for soil organic carbon content and percentage of semi-natural habitats).

Partner with other organizations: Though what qualifies as regenerative agriculture is not standardized, companies can work with partners to verify and/or enhance their efforts. This includes tagging products with labels for regenerative products, such as those of the Regenerative Organic Alliance (ROA) (15), verifying goals through a third-party Life-Cycle Assessment (LCA) by a firm like Quantis (16), or partnering directly with large corporations that can help organizations farm sustianably. For example companies like Anthesis (17), Truterra (18), and Regrow (19) have partnered with large CPG companies, including Kellogg’s (20) and Mars (21).

Targets

There is still no scientific agreement on thresholds for the outcome areas to which regenerative agriculture positively contributes. However, it is worth highlighting that the European Union’s Farm to Fork Strategy (22) has the target of reducing the overall use and risk of chemical and hazardous pesticides by 50% by 2030, and to reduce nutrient losses by at least 50%, while ensuring that there is no deterioration in soil fertility. This will involve a reduction in the use of fertilizers by at least 20% by 2030. Additionally, the Kunming-Montreal Global Biodiversity Framework (23) sets similar global targets for 2030: reducing excess nutrients lost to the environment by at least half, as well as reducing the overall risk from pesticides and highly hazardous chemicals by at least half.

Measurement

Outcomes derived from regenerative agricultural systems can be measured through the following non-exhaustive indicators to assess progress:

• Soil organic carbon content (tons of carbon/ha)

• Blue water withdrawals (m3/ha)

• Number of crops per ha per crop cycle

• Percentage of semi-natural habitats (% per km2)

• Pesticide risk – Environmental Impact Quotient (EIQ)

• Fertilizer usage – Nutrient Use Efficiency (NUE)

• Farming livelihoods expressed in € / year

Examples: Representative examples of how regenerative agriculture practices can be implemented:

• Kansas: A small proportion of wheat farmers in Kansas integrate multiple crops into their rotation, but many conventional farmers in drier regions of Kansas are currently restricted to a monoculture system due to water constraints (24). However, there are practices that can alleviate these constraints. Though mulching crop residue has a negative economic impact in the short run, the regenerative practice increases water retention and nutrient fixation which can enable the success of expanded crop rotation. This ability to introduce crop rotation has been used in Kansas to add intercropped soy and corn as cash crops that supplement the wheat harvest, improving both sustainability and overall profit.

• Philippines: Resilient Coconut Farming in the Philippines” is a 10-year (2018-2028) initiative on the island of Mindanao, Philippines that has been spearheaded by Mars, Inc. in partnership with the Livelihoods Fund for Family Farming, the Integrated Rural Development Foundation and coconut manufacturer and exporter Franklin Baker (25). The initiative aims to help smallholder farmers on Mindanao learn regenerative agriculture techniques, improve their yields, diversify the crops they grow, and secure better prices for their products. Its goal is to train 6k farmers in regenerative agriculture practices, empower cooperatives, and transition 10k hectares to regenerative agriculture.

Footnotes:

(i) Pedo-climatic zones are areas of relatively homogenous soil type and climate conditions