Difference between revisions of "The changing nature of farm financialization (Safaa)"

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(Created page with "==Regenerative business practices influence of agriculture:== Safaa Al-Adwan Team 1. ==Description:== By definition, regeneration simply means that something is brought into a renewed existence. A regenerative business acknowledges its place in the entire system where it operates—its community, its industry, its resources— and uses that knowledge of interdependence in their strategic decision-making, it is also about identifying one’s footprint and then moving awa...")
 
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==Regenerative business practices influence of agriculture:==
==Name==
Safaa Al-Adwan Team 1.
The changing nature of farm financialization:  
==Description:==
- Farming of subsidies
By definition, regeneration simply means that something is brought into a renewed existence. A regenerative business acknowledges its place in the entire system where it operates—its community, its industry, its resources— and uses that knowledge of interdependence in their strategic decision-making, it is also about identifying one’s footprint and then moving away from linear systems towards circular ones. It’s about managing natural assets in a way that allows and enables them to restore themselves sustainably. Regenerative business Agriculture is a broad understanding of different practices that contribute to regeneration in agriculture, one of them is developing it, there is no industry standard definition of what exactly mean when companies refer to regenerative business in agriculture, but there is indeed a clearer and supportive definition of what regenerative business mean in agricultural aspect, like PepsiCo, Unilever, Nestle', and Walmart stress that their companies is eager to act now regarding farming (Agriculture) rather than waiting for a consensus to be developed by governmental institutions.The practices these companies use to influence agriculture are as following:
- Direct to consumer sales
1. Growing more and using less of food production.
- Growth of carbon accounting
2. Creating and active management system for the chemicals.
3. Finding more sustainable agricultural supply chain for water management.
4. Improving the livelihood of supply chain. 
5. Focusing on sustainable resourcing.


==Enablers:==
==Description==
Businesses are already adopting regenerative agriculture in response to current and anticipated challenges, seeing yield impacts ranging from 68% up to 300%. Companies seeing changes to production as a result of degraded land are beginning to understand the potential impacts of inaction. Businesses such as AB InBev, LEAF Africa, Nespresso, Olam, Touton, and Twiga Foods have already implemented programs in the SSA region in programs reaching over 100,000 farmers. They are seeing success in the form of increased yields, greater output, and a more resilient and sustainable supply chain. With success driven by demonstration of evidence, engagement with communities and holistic integration.Three categories have been identified as broad success factors in these business programs:
Agriculture finance empowers poor farmers to increase their wealth and food production to be able to feed 9 billion people by 2050. The work in agriculture finance helps clients provide market-based safety nets, and fund long-term investments to support sustainable economic growth. Demand for food will increase by 70% by 2050; at least $80 billion annual investments will be needed to meet this demand.
1. Demonstrate evidence to scale up uptake: This could be implemented by; Using demonstration plots to build farmer trust, Training programs to support independent implementation, and Showing farmers the value of regenerative practices.
There is an ever increasing need to invest in agriculture due to a drastic rise in global population and changing dietary preferences of the growing middle class in emerging markets towards higher value agricultural products. In addition, climate risks increase the need for investments to make agriculture more resilient to such risks. Estimates suggest that demand for food will increase by 70% by 2050 and at least $80 billion annual investments will be needed to meet this demand, most of which needs to come from the private sector. Financial sector institutions in developing countries lend a disproportionately lower share of their loan portfolios to agriculture compared to the agriculture sector’s share of GDP.  
2. Engage with local communities: The above mentioned companies did that by; Tailoring engagement to local context, Fostering equitable gender participation, Building stronger local governance.
3. Consider the broader context: It could be done through; Extend investment across the supply chain, Leverage digital access, and Align public and private finance streams.  


==Inhibitors:==
==Enablers==
Understanding the psychological, economic, and cultural motivations behind farmer decision-making is a crucial first step in designing future investment and market strategies that are rooted in reality and reflect the on-the-ground needs of the people who will ultimately carry out this transition (farmers themselves):
There is an ever increasing need to invest in agriculture due to a drastic rise in global population and changing dietary preferences of the growing middle class in emerging markets towards higher value agricultural products. In addition, climate risks increase the need for investments to make agriculture more resilient to such risks. Estimates suggest that demand for food will increase by 70% by 2050 and at least $80 billion annual investments will be needed to meet this demand, most of which needs to come from the private sector. Financial sector institutions in developing countries lend a disproportionately lower share of their loan portfolios to agriculture compared to the agriculture sector’s share of GDP.
1. The cost (or perceived cost) remains a commonly cited obstacle amongst farmers and organisations serving farmers.
2. Behavior and cultural change: farmers enter into, navigate, and, importantly, sustain the required paradigm shift in their approach to managing their properties, farm businesses, and personal lives.
3. Land access: The cost of farmland is high—so high that it is often impossible for new farmers and ranchers to get started in farming without a family connection or renting it from company owners.
4. Trusted Technical Assistance: Farmers and ranchers are extraordinarily busy people, managing complex businesses in a risky, low-margin, and ever-changing business environment. This reality makes taking time to learn about and experiment with new management practices a slow and time-consuming process. Without technical assistance, many farmers do not have the resources, time, or energy to learn about, plan, implement, and monitor climate smart practices on their own, much less do the paperwork associated with applying for and tracking government incentive grants.  


==Paradigms:==
==Inhibitors==
- Extractive agriculture: The significant financial cost of mechanisation and high levels of off-farm inputs has led to mounting debt, along with the consolidation of farm and infrastructure ownership in the hands of fewer and fewer large companies.
Agriculture is the mainstay of the economy: 70 percent of the active population is engaged in the sector that generates nearly one-third of the national gross domestic product (GDP). The GoN has prioritised agriculture in its periodic plans and annual development programmes, but these remain to be strengthened in terms of implementation. The majority of farmers, who are increasingly likely to be women as males have been migrating in search of more remunerative work, are poor and climate-vulnerable. The women workers’ share in agriculture has remained significant and dropped only marginally as compared to male workers.Agriculture has already been adversely impacted
- Conservative agriculture: Efficiency is paramount in this paradigm. Practices like precision agriculture, integrated pest management, and high-efficiency irrigation enable farms to ‘do more with less.’ More efficient machinery is used to plant and manage more efficient crops. Combining digital field monitoring, fine-tuned fertiliser application, and more targeted biocides allows farmers to reduce their inputs and costs
- Net-positive agriculture: This paradigm explicitly aims to build soil, improve water cycle health, and increase biodiversity while producing food for communities and economic wellbeing for farmers.




==Experts:==
==Paradigms==
1. Nespresso works with over 37,000 farmers and 300 local wet mills to source coffee from Ethiopia. Since 2013, the business’ coffee sourcing program has been operated locally and is supported by a range of expert partners on agroforestry. At the heart of the program is a commitment to empower farmers with sustainable agricultural practices (Nespresso, 2021). (The business is working with coffee farmers in Ethiopia to improve coffee yields, reduce poverty and increase long term climate resilience).
- It creates a lack of transparency of land ownership and production units.
2. Olam This business sources its cotton from Côte d’Ivoire through its subsidiary, Société d’Exploitation Cotonnière Olam (SECO), which implements best practices across the supply chain. 20% of Olam's cotton is sourced from Côte d’Ivoire (Olam, 2017a), with the subsidiary established in 2008 with the aim of organising supply chain activities efficiently and to create an integrated supply chain. (Cotton yields have increased by 80% in Cote d‘Ivoire through training farmers to implement regenerative agricultural practices).  
- It makes it possible to circumvent existing regulations.
3. Touton: is applying regenerative agriculture techniques to cocoa production in the Bia-Juabeso region in Ghana. In May 2017, the company announced its commitment to ending deforestation in its supply chain, signing up to the Cocoa and Forests Initiative and embarking on a pilot for the Partnership for Productivity Protection and Resilience in Cocoa Landscapes (3PRCL) project (Touton, 2018). The Bia-Juabeso-based project aims to restore forests while reducing carbon emissions in the cocoa sector. As part of this, Touton has promoted regenerative agriculture practices such as mulching, pruning and shade trees.
- It undermines farmers’ independence
4. Twiga: An online food distribution platform is used to increase supply chain efficiency and for sustainable practice. This Nairobi-based business-to-business food distribution company connects farmers to food vendors through an online platform. A mobile-based platform serves around 3,000 outlets a day, through a network of 17,000 farmers and 8,000 vendors (Bright, 2019). As part of its commitment to implement best practices in agriculture, the business encourages the use of regenerative agriculture on its partner farms.
- It impedes the generational transition
- It fosters the development of farm corporations operating solely on the basis of salaried work


==Timing:==
==Experts==
- 1980s: Started with Climate change- Costs were $18 billion.
- Bruno Larue: Agricultural economics, agricultural policies: bruno.larue@eac.ulaval.ca
- 1990s: Cost got more expensive to spend in Climate change and agriculture.  
- John Reilly: Agriculture economics. Air pollution and emissions Biofuels Climate change policy
- 2012: There are also significant public health costs associated with climate change. According to one study, climate change caused $10 billion in health-related expenses.
- Between 2017 and 2019, natural disasters cost the U.S. an average of $153.5 billion each year.
- 2018: economic costs $149 billion
- 2019: Cost of public health associated with climate change is on current increase (Limaye, Max, Constible, & Knowlton, 2019).  
- Greater costs are likely in the future as climate change worsens. Low-income and minority communities suffer this burden most heavily. If society will bear the economic costs of climate change regardless, markets should be arranged so that that money is spent proactively in preventing greater future costs. Otherwise, we will continue to passively pay the ever-increasing costs that come from inaction, which will far eclipse the costs of prevention now.


==Web Resources:==
==Timing==
- https://growensemble.com/regenerative-business/
- 1800-1870: Level of carbon dioxide gas (CO2) in the atmosphere, as later measured in ancient ice, is about 290 ppm (parts per million).
- https://sustainablebrands.com/read/defining-the-next-economy/regeneration-and-business-the-challenges-of-implementation
- 1960: Mitchell reports downturn of global temperatures since the early 1940s.=>Modern temp's
- https://www.foodnavigator.com/Article/2021/04/26/Regenerative-farming-practices-can-help-restore-the-earth-PepsiCo-discusses-its-Positive-Agriculture-Programme
Keeling accurately measures CO2 in the Earth's atmosphere and detects an annual rise. =>CO2 greenhouse
- https://www.iucn.org/sites/dev/files/regnererative_agriculture_in_africa_report_2021.pdf
- 1985: Ramanathan and collaborators announce that global warming may come twice as fast as expected, from rise of methane and other trace greenhouse gases.
- https://forainitiative.org/wp-content/uploads/Barriers-to-Adopt-Regnerative-Agriculture-Interactive.pdf
 
- https://www.conservationfinancenetwork.org/2020/04/15/farmers-on-the-frontlines-of-the-regenerative-agriculture-transition
==Web Resources==
- https://www.foodunfolded.com/article/regenerative-farming-ask-the-expert
- https://www.worldbank.org/en/topic/financialsector/brief/agriculture-finance
- https://e2.org/wp-content/uploads/2021/03/Jock-Final-Report-The-Promise-of-Regenerative-Agriculture.pdf
- https://legal-dictionary.thefreedictionary.com/Agriculture+Subsidies 
- https://history.aip.org/climate/timeline.htm
- https://reliefweb.int/sites/reliefweb.int/files/resources/UNDP_NP-Impact-of-Climate-Change-Finance-in-Agriculture-on-the-Poor.pdf
- https://www.arc2020.eu/combating-the-financialisation-of-agriculture-your-land-my-land-our-land/

Revision as of 17:09, 8 December 2021

Name

The changing nature of farm financialization: - Farming of subsidies - Direct to consumer sales - Growth of carbon accounting

Description

Agriculture finance empowers poor farmers to increase their wealth and food production to be able to feed 9 billion people by 2050. The work in agriculture finance helps clients provide market-based safety nets, and fund long-term investments to support sustainable economic growth. Demand for food will increase by 70% by 2050; at least $80 billion annual investments will be needed to meet this demand. There is an ever increasing need to invest in agriculture due to a drastic rise in global population and changing dietary preferences of the growing middle class in emerging markets towards higher value agricultural products. In addition, climate risks increase the need for investments to make agriculture more resilient to such risks. Estimates suggest that demand for food will increase by 70% by 2050 and at least $80 billion annual investments will be needed to meet this demand, most of which needs to come from the private sector. Financial sector institutions in developing countries lend a disproportionately lower share of their loan portfolios to agriculture compared to the agriculture sector’s share of GDP.

Enablers

There is an ever increasing need to invest in agriculture due to a drastic rise in global population and changing dietary preferences of the growing middle class in emerging markets towards higher value agricultural products. In addition, climate risks increase the need for investments to make agriculture more resilient to such risks. Estimates suggest that demand for food will increase by 70% by 2050 and at least $80 billion annual investments will be needed to meet this demand, most of which needs to come from the private sector. Financial sector institutions in developing countries lend a disproportionately lower share of their loan portfolios to agriculture compared to the agriculture sector’s share of GDP.

Inhibitors

Agriculture is the mainstay of the economy: 70 percent of the active population is engaged in the sector that generates nearly one-third of the national gross domestic product (GDP). The GoN has prioritised agriculture in its periodic plans and annual development programmes, but these remain to be strengthened in terms of implementation. The majority of farmers, who are increasingly likely to be women as males have been migrating in search of more remunerative work, are poor and climate-vulnerable. The women workers’ share in agriculture has remained significant and dropped only marginally as compared to male workers.Agriculture has already been adversely impacted


Paradigms

- It creates a lack of transparency of land ownership and production units. - It makes it possible to circumvent existing regulations. - It undermines farmers’ independence - It impedes the generational transition - It fosters the development of farm corporations operating solely on the basis of salaried work

Experts

- Bruno Larue: Agricultural economics, agricultural policies: bruno.larue@eac.ulaval.ca - John Reilly: Agriculture economics. Air pollution and emissions Biofuels Climate change policy

Timing

- 1800-1870: Level of carbon dioxide gas (CO2) in the atmosphere, as later measured in ancient ice, is about 290 ppm (parts per million). - 1960: Mitchell reports downturn of global temperatures since the early 1940s.=>Modern temp's 

Keeling accurately measures CO2 in the Earth's atmosphere and detects an annual rise. =>CO2 greenhouse

- 1985: Ramanathan and collaborators announce that global warming may come twice as fast as expected, from rise of methane and other trace greenhouse gases.

Web Resources

- https://www.worldbank.org/en/topic/financialsector/brief/agriculture-finance - https://legal-dictionary.thefreedictionary.com/Agriculture+Subsidies - https://history.aip.org/climate/timeline.htm - https://reliefweb.int/sites/reliefweb.int/files/resources/UNDP_NP-Impact-of-Climate-Change-Finance-in-Agriculture-on-the-Poor.pdf - https://www.arc2020.eu/combating-the-financialisation-of-agriculture-your-land-my-land-our-land/

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