North America’s Role in Future Proofing Tomorrow’s Food Supply
North America’s Role in Future Proofing Tomorrow’s Food Supply
Senior Advisor, Climate Modelling, BMO Climate Institute
Alma leads the Climate Institute’s economic analysis of low and zero emissions technologies and sector decarbonization roadmaps, as well as the cost-benefit o…
Senior Advisor, Climate Change & Sustainability
George Sutherland is a Senior Advisor with the BMO Climate Institute, working at the intersection of climate science, policy, and finance to understand and man…
Associate, Sustainable Finance
Katie supports the Sustainable Finance Group in providing clients with ESG and climate related advisory, the structuring of sustainable products, and access to conc…
Alma leads the Climate Institute’s economic analysis of low and zero emissions technologies and sector decarbonization roadmaps, as well as the cost-benefit o…
VIEW FULL PROFILEGeorge Sutherland is a Senior Advisor with the BMO Climate Institute, working at the intersection of climate science, policy, and finance to understand and man…
VIEW FULL PROFILEKatie supports the Sustainable Finance Group in providing clients with ESG and climate related advisory, the structuring of sustainable products, and access to conc…
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With the global population forecast to grow to more than nine billion by 2050, it came as little surprise that food security was a key theme at the Biodiversity COP15 in Montreal and had a full day dedicated to it at the COP27 Climate Conference in Egypt last month.
The Adaptation and Agriculture Day at COP27 saw the introduction of the Initiative on Climate Action and Nutrition (I-CAN), which seeks to accelerate the role of national climate policies in shifting our entire food systems to achieve net-zero emissions and improved health outcomes.
It also saw the introduction of the Food and Agriculture Sustainable Transformation (FAST) Initiative, launched by the COP27 Presidency and UN Food and Agriculture Organization, which aims to scale climate finance flows to transform food and agriculture systems.
Be it the war in Ukraine, some of the worst droughts in recent memory and numerous other global extreme weather events, or rising protests from farmers who say climate policy will strangle their ability to produce affordable food, 2022 underscored the challenges of feeding a growing world population while reducing greenhouse gas (GHG) emissions.
Those challenges mean the countries that will lead global food production tomorrow will need to find ways to produce more food while reducing emissions and keeping their farmers in business.
Canadian and U.S. governments are broadly opting for strategies that help farmers shift toward sustainable agriculture rather than mandating GHG reductions and putting the costs onto producers. Instead of specific emission reduction targets, policy makers have signalled billions in expanded support—through the Inflation Reduction Act and Emission Reduction Plan, in the United States and Canada respectively—to advance farmers’ continued effort to reduce emissions. On top of existing grants and incentives, governments are committing incremental funds to scale adoption of precision agriculture and low- or zero-emission farming technologies, to deploy on-farm renewable energy production, to grow an R&D system that will provide the next generation of low carbon solutions, and to increase the ability of farmlands to store carbon.
Against this backdrop, to meet the increasing expectation for continued abatement in the sector, governments are also testing the waters with targets to reduce emission from key sources. Canada, for example, recently completed consultation on a proposed voluntary target to reduce nitrogen emissions from fertilizer by 30% below 2020 levels.
Stable Emissions
Emissions from the agriculture sector have remained stable in both Canada and the United States as efficiencies have balanced increased output, but as global food demand grows, governments in both counties are expecting emissions in the agriculture sector to increase. Methane and nitrogen use, which are the largest contributors to the sector’s GHG emissions, are anticipated to climb to 625 Mt CO₂ eq by 2030, for example.
Reducing these emissions will not be cheap. According to McKinsey & Company, reaching net-zero goals by 2050 will require some USD$840 billion in annual investment. It will also depend on farmers’ ability to realize the potential of soil carbon sequestration so that they can monetize emission reductions.
Approximately ~1,500 Mt CO2 eq is stored in the top 30cm of agriculture soils in Canada and the US—equivalent to more than 2x the annual emissions from both countries’ agriculture sectors. This pool of stored carbon represents a significant removal of GHGs from the atmosphere, and there is further potential to be unlocked from the sector’s agriculture soils.
Monetizing this potential will require a strong demand pull from voluntary carbon markets that have yet to mature. Key enablers to these market conditions include a rising price on carbon, policy certainty through industry-specific offset protocols, and expertise from companies that support farmers in GHG calculations and carbon credit generation and monitoring.
Advancing food system security
A low-carbon world requires more than just a revolution in how we produce and consume energy, but also in our food systems.
In early 2023, the BMO Climate Institute will release an in-depth analysis of opportunities to reduce GHG emissions while enhancing security and resilience of food systems. Decision-useful insights on the potential impacts of climate change to key agriculture regions will be reported, along with the financing strategies required to crowd-in private capital.
Canadian and US policy makers are currently drafting their next five-year agriculture strategies, and we see tremendous opportunity for North American producers to become global leaders in climate-aligned agricultural systems and exporters of low carbon and sustainable food products.
