“We support our clients in decarbonization, knowing that one size does not fit all”
Huib-Jan de Ruijter | Co-CIO at FMO
Agriculture is often considered an art. Traveling with colleagues and partners from the Dutch Fund for Climate and Development (DFCD) in Vietnam and Cambodia recently, I saw again how nourishing crops, cultivating soil and animal welfare all need the keen eye of the farmer as well as hands-on technical skills. At the same time, agriculture is surely a science as well. These farmers are also introducing more climate resilient crop varieties and looking for methods to use less fertilizer. This needs data, research and knowledge, necessities for any farm – big or small - to flourish. So, let’s agree on agriculture being an artful science. Both sides of the coin – the how and the why - will be necessary given the pressure agriculture is facing: an ever-growing global population in need of proper nutrition on the one side, scrutiny for its contribution to climate change on the other, both combined with the fact that farmers, mostly so in emerging economies, are among the first to suffer from changing weather patterns and deteriorating soil, water and biodiversity conditions.
Therefore, it is not a surprise that the focus on sustainable agriculture has significantly increased in recent years, a trend that will only intensify. This is especially the case in European markets, where the EU has set specific emission-reduction goals for 2030 and 2050. But while a company may be located in Europe, its agricultural value chain may stem from anywhere in the world. The EU is increasingly calling for all European companies to take responsibility for the emissions in their value chains, which will also impact FMO’s clients.
This edition of our Future-minded magazine focuses on how companies in the agriculture and food sector are advancing their decarbonization journey and how they look beyond their own production to reduce emissions along their value chain. This is even more challenging since we know that food production needs to grow by 60% to feed a world population of over 9 billion by 2050 (source: FAO). FMO supports its customers in this journey, knowing that one size does not necessarily fit all.
growth of food production needed by 2050 to feed 9 billion
In this edition, FMO’s Pieternel Boogaard (Director of the Agribusiness, Food & Water department) and Carrie Walczak (Senior Advisor Sustainability Strategy & Policy) are interviewed together, to give more insight into how FMO is working with clients on climate action, taking their specific needs, contexts, and resources into account. The interview shows that there are still some topics that we need to get our head around at FMO, for instance the speed of decarbonization required in light of our other social and environmental impact objectives.
FMO’s aim is to work towards a just and inclusive transition to global net zero goals in 2050. We introduced this with our 2030 Strategy Pioneer - Develop - Scale in 2022.
But where to start, if decarbonization is new on your agenda? The answer is to start with data, says Piet van Asten, head of Sustainable Production Systems for ofi, a global supplier of sustainable, natural, value-added cocoa, coffee, dairy, nut, and spice ingredients. Only when you know what your carbon footprint is - not just for your production but also along the supply chain - can you start taking proper reduction measures. He gives an example on the use of fertilizers. "Fertilizer choice has an impact on carbon footprints. Our field teams collect detailed information on which inputs farmers are using and how they’re applying them. Applying a fertiliser uniformly, you’re basically giving the high-performing trees too little fertiliser and the low performers too much."
Zooming in on FMO’s clients, United Exports - a blueberry producer (amongst other things) in South Africa - shares how the company is executing its climate action plan. Energy assessments for all production sites for example (data!) and managing water as efficiently as possible, since moving water around takes energy. Kiliç Deniz, Türkiye’s leading aquaculture producer for various types of fish, already had oversight of its entire value chain, producing their own fish feed and owning its own hatcheries. Now, after co-operating with FMO, it is one of the most carbon-friendly animal protein producers worldwide.
I hope you enjoy reading the magazine. But most of all, I hope you will be inspired by the stories of our partners and the many opportunities the agricultural sector offers, not only to secure food production, but also to contribute to climate action, as the artful science it is.