Climate Change

Issue Overview

Although climate change is likely to affect agriculture differently from region to region, there is scientific consensus that global climate change will have major, generally negative impacts on food systems. Erratic weather, the effects of temperature shifts and sea level rise threaten current agricultural systems.

Climate change creates more erratic weather patterns, resulting in more instances of prolonged drought as well as severe flooding which can degrade and inundate farms and livestock operations.  

  • Variations in seasonal temperatures and changing rainfall patterns increase crop stress and reduce livestock yield.
  • Warmer temperatures impact the timing of snow melt, which is a major contributor to water supply for growing regions.
  • Crop and animal loss from disease, pests, and weeds, intensify as temperatures rise.
  • In some coastal regions of the world, the rise in sea levels reduces usable cropland.

At the same time, the conversion of natural habitats and practices used in agricultural and livestock operations contribute to climate change. Direct contributions from food production include:

  • Greenhouse gas emissions (GHG) generated during livestock production and manure management
  • Production of nitrous oxide from synthetic fertilizer use (to grow crops and livestock feed)
  • Methane produced during the cultivation of rice in flooded conditions
  • Fossil fuel emissions from powering machinery and irrigation pumps.

Agricultural producers can play an active role in mitigating greenhouse gas emissions through shifts in their management choices. Common examples include improving the management of soils, optimizing use of fuel/ fertilizer inputs, and reducing methane emissions from livestock production. Proactive strategies to address GHG emissions within food production make good business sense. These strategies enable companies to identify opportunities to bolster their bottom line and improve planning for potential future climate change regulations. Agriculture’s environmental and social challenges are all interrelated, and understanding them requires a system-wide view. Climate change, for example, affects water availability, but land management practices affect water quality and contribute to climate change.

Climate Change and Agricultural Greenhouse Gas Emissions

Agricultural Emissions

Annual greenhouse gas emissions linked to human activity reached 49 million tons (49 gigatons) of carbon dioxide equivalents (GtCO2e) in 2010, the highest annual amount ever recorded and an increase of 10 GtCO2e (or about 25%) since 2000. The agriculture, forestry and land use sector was responsible for 24% of emissions in 2010 (11.8 GtCO2e); second only to the energy sector. 

In the agriculture sector, emissions from “crop and livestock production” exceeded emissions from “land use, land use change, and forestry, including deforestation.” The contribution of agriculture as a source of emissions varies widely by country due to the efficiency and type of agricultural system. For example, in 2010, emissions from agriculture accounted for 9% of greenhouse gas emissions in the United States; yet accounted for 29% of emissions in developing countries. 

Projected Agricultural Emissions Growth

Population growth and income-driven dietary shifts are projected to increase agricultural emissions by 80% by 2050.

Population Growth- Feeding 2.2 billion more people in 2050

The world population was 7.6 billion in 2017, an increase of one billion people over the last 12 years. Though fertility rates are declining, and are expected to continue declining, the global population is nonetheless expected to grow to 8.6 billion in 2030, 9.8 billion in 2050, and 11.2 billion in 2100. Most of the predicted population increase will be concentrated in Africa and Asia: by 2050, it is estimated that compared to 2017, there will be 1.3 billion more people living in Africa, 750 million more in Asia, and modest growth everywhere else but Europe, where population may decline slightly. To meet food demand, increases in agricultural production are expected to increase emissions from agriculture if production continues along the same emissions trajectory. 

Income-Driven Dietary Changes

Changes in diet will strongly affect future greenhouse gas emissions from food production. Globally, per capita food supply increased from 1961 to 2002; though food supply in developing countries increased by 31%, food supply in developing countries was still lower than in developed countries. Compared to average diet in 2009, the average diet in 2050 will have 15% more total calories, a shift predicated on global economic growth and associated increase in household income. Dietary shifts toward higher calorie consumption, particularly from meat, sugar and fat, would increase per capita greenhouse gas emissions by 32%. 

In developing countries, the rate of growth in consumption of calories from animal-based protein is projected to increase much more quickly than overall calorie consumption (123% compared to 31%). While livestock products provide protein and a wide range of essential micronutrients, production of animal products, especially ruminants, is more emission-intensive than other food sources. Livestock-related greenhouse gas emissions stem largely from enteric fermentation (digestion in ruminants) and manure (manure management on farms and manure left in pastures). Fertilizers and energy used for growing livestock feed also contribute to greenhouse gas emissions. Increased livestock production due to growing demand for meat also has been linked to the destruction of forests and grasslands.

Food Loss and Waste

Approximately 30–40% of all food produced is lost or wasted in the supply chain. In developing countries, most food is lost on farm or during distribution due to poor storage, transportation, and conservation. In developed countries, much more food is wasted in service sectors and at the consumer level.  Food losses occurring at agricultural production phases appear homogenous across regions, representing about one-third of each region’s total food loss and waste, but waste at the consumption end of the supply chain is much more variable; 31–39% of food is wasted in middle- and high-income regions and 4–16% of food is wasted in low-income regions.

Food wasted at the consumer level in industrialized countries (222 million tons) is almost as high as the total net food production in sub- Saharan Africa (230 million tons). The global economic, environmental, and social cost of food wastage is estimated at USD$2.6 trillion, which is nearly equal to the GDP of France. Food loss and waste represents lost income, generates unnecessary greenhouse gas emissions, and wastes both water and land, negatively impacting natural ecosystems. Food loss and waste accounted for about 4.4 GtCO2e/yr., or about 9% of all emissions, according to a 2013 study. This amount includes emissions from the agriculture sector, industry (production of fertilizer), transportation (moving food around), buildings (storage), and energy (refrigeration). 

Reducing food loss and waste can reduce GHG emissions by 0.6–6.0 GtCO2e/yr. A goal of reducing food waste along the food supply chain by about 50% is considered feasible. By comparing food availability and food requirements country by country, experts estimated that up to 14% of emissions from agriculture in 2050 could be avoided by managing food use and distribution better.

Company Investment in Agricultural GHG Mitigation

A trajectory with increasing agricultural emissions will not limit global warming to less than 2°C above pre-industrial levels. To limit global warming to less than 2°C, global greenhouse gas emissions will need to be 40% to 70% lower in 2050 than in 2010, combined with large increases in carbon sequestration. Delay in implementing mitigation efforts will substantially decrease policy and economic options and increase the difficulties of transitioning to a low-emission economy.

Major investments in systemic change to supply chains are necessary to achieve substantial reductions in emissions in agriculture. While public financing is often discussed as a solution in the international community, the private sector was responsible for two-thirds and three-fourths of all mitigation finance globally between 2010–2012. Most likely, both public and private financing will be necessary.

Until recently, many food companies focused on measuring and reducing emissions from operations, for example by reducing their electricity consumption or fuel emissions from transportation and distribution. However, for most food companies, the biggest source of greenhouse gas emissions occurs in the agricultural production portion of the supply chain. In order to meet our collective commitment to limiting warming to 2 degrees, food companies must widen their focus beyond direct operations to work with their suppliers to report and reduce greenhouse gas emissions across supply chains. Reducing emissions from agriculture is both necessary and achievable.

Opportunities to Reduce Greenhouse Gas Emissions and Sequester Carbon Through Agricultural Practices

Around the globe there is strong support across food supply chains for adopting agricultural practices that reduce greenhouse gas emissions. In many cases, producers willingly embrace these climate change mitigation practices because they also increase yields and profitability and contribute to more efficient utilization of resources. In developing countries, many of these practices also contribute to national food security and economic development goals. 

Managing Livestock Feed, Herds, Manure and Grazing Land

Livestock emissions account for a third of agriculture and land use emissions. Ruminant meat, especially, is emission-intensive, but it is even more intensive in developing countries because production and supply chains tend to be inefficient. Mitigation in livestock is a focus in developing countries because of the high emissions per unit of production and because livestock numbers are increasing dramatically. Mitigation options for livestock production in developing countries include improved feeding practices, dietary additives, animal breeding, improved manure storage and handling, anaerobic digestion of manure, more efficient use of manure as nutrient for crops, and sustainable intensification. In many areas, livestock producers also have the opportunity to reduce emissions through improved management of grazing lands for nutrients, fire management, and biodiversity / fodder species. Globally, animal science is producing innovations in feed, rumen, and breeding that could reduce emissions further.

Reducing Methane in Irrigated Rice

Rice is the staple food for more than 3.5 billion people worldwide, around half of the world's population, and the second most produced cereal crop in the world.  Most rice is grown in flooded conditions that cause high methane emissions. (Methane is a greenhouse gas that is 25 times more potent than carbon dioxide over a 100-year period.) Simple changes to production, such as alternate wetting and drying of irrigated rice, switching to short duration varieties of rice, and improving nutrient use efficiency through urea deep placement can significantly reduce methane emissions, while preserving yields and saving growers money on fertilizer and water inputs. 

Improved Soil and Nutrient Management

There are many low-emission soil management practices that can reduce greenhouse gas emissions and sequester carbon. For example, optimizing nutrient use by applying the right type of fertilizer at the right rate, time and place, contributes to higher yields and reduces the amount of greenhouse gas emissions. Soil management practices are described in packages of techniques that include conservation agriculture, no-till cultivation and rotational agriculture. Low emission practices include diversification of annual crops, avoidance of crop residues burning, integration of crop and livestock systems, and utilization of improved seed varieties that are resilient to certain diseases, pests or climate fluctuation.

Expanding Agroforesty and Conserving Forested Lands

Managing fires on croplands and in forests, investing in sustainable tree crops, and adding an agroforestry component to annual cropping systems contribute to soil and biomass carbon sequestration. Adding trees on farms can increase yields of annual crops, add income and nutrition from yields of tree crops, and sometimes provide fodder for animals.

Reducing Food Loss and Waste

The impact of the food system on climate change can also be decreased by reducing the amount of food lost and wasted and shifting the diets of populations who consume high amounts of calories, protein, and animal-based foods.

Food loss and waste: It is estimated that 30-40% of all food produced globally is never eaten – it is either discarded or lost at some point along the food value chain. Food loss and waste is estimated to be responsible for about 8% of annual greenhouse gas emissions. The global economic, environmental, and social cost of food wastage is estimated at USD$2.6 trillion. The Intergovenmental Panel on Climate Change recognizes that reducing food loss and waste has major greenhouse gas mitigation potential (0.6–6.0 GtCO2e/yr). 

Food preferences: As incomes increase, people tend to increase calorie intake and resource intensive foods such as meats. It is estimated that such dietary changes will increase total emissions from agriculture by 32% by 2050, as well as have deleterious impacts on health. Diet preferences combined with expected population increases would lead to an 80% increase in greenhouse gas emission from agriculture. In the U.S., the carrying capacity of existing agricultural land can support 402 million people given the current average U.S. diet, but could feed twice as many (807 million) if a dairy-friendly vegetarian diet was followed. The IPCC estimates that changes in diet towards more plant-based and less emission-intensive foods could result in emission savings of 0.7–7.3 GtCO2e/yr by 2050, depending on diets.

The Intergovernmental Panel on Climate Change (2014) estimates that the mitigation potential of supply-side agriculture in 2030 is 0.5–10.6 GtCO2eq/yr. While reaching this potential would contribute significantly to meeting global greenhouse gas reduction goals, scientists have determined that additional innovation will be necessary to limit global warming to less than 2°C. 

Business Risks from Climate Change

Operational

Beginning in 2012, GlaxoSmithKline found that more extreme and variable weather caused by climate change was having a major impact on British blackcurrant harvests.

IMPACTS

  • Reduced agricultural productivity

Operational

Campbell’s Soup Company has struggled with extreme weather in California, a key growing region for its carrot supplies. In 2014, California's record-setting drought followed by intense rains led to a 28% decline in profits for its carrot division.

IMPACTS

  • R&D spending for more resilient varieties

Litigation

In late 2015, a Peruvian farmer filed suit against RWE, a large European energy company, for its alleged contributions to global warming based on its total emissions over two centuries. The complaint claims that global warming is causing glaciers near the farmer's home to melt, which in turn is causing lakes in the area to flood and threaten his property.

IMPACTS

  • Legal fees and monetary settlements for violating laws and regulations

Priority Commodities

Among the most commonly sourced commodities profiled in Engage the Chain, climate change impacts are most significant in the production of beef and dairy. Of note, deforestation and land use change related to the production of beef, palm oil, and soybean also contributes to global climate change. This is addressed in the section on “deforestation and land use change.” 

The following summarizes how the production of beef and dairy contribute worldwide to climate change. It is important to consider that the scale of the impacts depends on the practices used by individual livestock operations and feed growers, as well as regional and local conditions.

Beef

Beef production has a significant impact on climate change, accounting for 5.9 percent of total manmade greenhouse gas emissions.

  • Cattle contribute directly to greenhouse gas emissions when they digest their feed and produce manure. Fertilizers and energy used for growing the animal’s feed also contribute to total greenhouse gas emissions.
  • More than half of the global emissions from the livestock sector are related to beef and cattle milk (beef accounts for 41 percent; dairy cows for 20 percent).

Dairy

Dairy production has a significant impact on climate change.

  • Dairy cows release greenhouse gases when they digest their feed (enteric fermentation).
  • Dairy operations contribute greenhouse gases during manure management (anaerobic decomposition of organic matter in manure). 
  • Fertilizers and energy used to grow feed also contribute to greenhouse gas emissions.

More than half of the global emissions from the livestock sector are related to beef and cattle milk (dairy cows account for 20 percent; beef for 41 percent). Globally, cattle milk produces 1.42 gigatonnes of CO2 eq per annum, representing 2.9 percent of human-induced GHG emissions.

When calculating a “greenhouse gas footprint” for beef or dairy in any particular operation, it is important to take into account how the animals are raised as changes in their type of feed and other management practices affect the amount and type of greenhouse gas emissions. 

Priorities for Investor Engagement

Ceres Investor Network on Climate Risk and Sustainability: The Ceres Investor Network on Climate Risk and Sustainability comprises more than 130 institutional investors, collectively managing more than $17 trillion in assets, advancing leading investment practices, corporate engagement strategies and policy solutions to build an equitable, sustainable global economy and planet.

Explore Ceres' Climate and Sustainability Shareholder Resolution Database