The Low Carbon Kid: Post COP21 agro-industrial companies are sitting on massive "stranded land-use assets"

Saturday, December 12, 2015

Post COP21 agro-industrial companies are sitting on massive "stranded land-use assets"

Now an agreement has been reached by the world's nations in Paris this week to tackle climate change, what will the world look like in 2100?

That depends on how well it is implemented, but if we peer into the future, we find that whatever happens there are crucial implications for land use and, therefore, feeding humanity.

As a result, the world's big agro-industrial companies are relying on massive land-use models that will become obsolete in the same way that oil companies' carbon assets will be stranded. They must, in short, adapt or die.

The evidence: caught in a double bind

Either the world fails to tackle climate change, and desertification renders these models useless, or it succeeds, and this necessitates a new approach to feeding the world. Below is my reasoning.

A new computer simulation peer-reviewed in the journal Nature using the UN IPCC AR5's Fifth Coupled Model Intercomparison Project (CMIP5) shows that drylands (the world's deserts) could well expand from covering 38% of the world's land surface – as they do at the moment – to around one half, if the agreement reached does not achieve the full 1.5^oC target.

The exact amount of desertification will depend upon the degree to which the concentration of greenhouse gases in the upper atmosphere can be constrained.

Here are three possible scenarios, relative to a 1961–1990 baseline for total dryland area across the world:

1. As projected under a business-as-usual scenario, where we just carry on as we are doing, dryland area will increase by around 23% to cover 56% of land surface. This corresponds to the IPCC's representative concentration pathway (RCP) 8.5, in which we reach a global-mean warming level of about 4°C above pre-industrial levels by the 2080s.

2. If we attain the approximate measures represented by the pledges currently made by the world's nations in their INDCs, dryland will increase by 11% to 50% of total land surface. Global average temperatures will increase by around 2.5°C from preindustrial levels. (We have already reached just over 1°C rise.) This corresponds roughly to the IPCC's RCP4.5.

Both of these scenarios would see a negative feedback effect, meaning that things would get progressively worse, as drylands are able to sequester less carbon from the atmosphere compared to healthy soil, and regional warming would increase, as it is generally twice that of humid regions.

3. Only by enacting measures roughly in agreement with RCP2.6 would this increase in desert land area slow down. This is a 'peak-and-decline' scenario, where the radiative forcing level first would reach a value of around 3.1 W/m2 by mid-century, then returning to 2.6 W/m2 by 2100, with 490 CO2 equivalent parts per million atmospheric concentration and a global average temperature increase of 1.5°C.

How do we achieve 'peak-and-decline'?

This will require stringent policies to limit emissions. Primary energy use will still double, but by 2100 coal and natural gas burning would be at around twice the level in the year 2000, oil around one third of the level in that year, the main increases being in bioenergy, nuclear and solar/wind/geothermal/tidal energy. Some means of sequestering carbon is also required to meet the safe targets.

But that is only half the story: land-use must also change. The dominant agro-industrial model on the planet contributes at least one third of global anthropogenic greenhouse gas emissions.

A major driver for change to reduce these emissions is that the agricultural companies, which have so far been amongst the worst offenders for not changing their policies to adjust for climate change, will have to change their business models or face ruin – and the sooner the better.

We have now got used to the phrases "carbon bubble" and "stranded carbon assets" vis-a-vis the oil industry. By analogy, agro-industrial companies are sitting on massive "stranded land-use assets". Their company value will plummet unless they change their practices.

To change their business models they will need help, but modelling of emissions as a result of land use has lagged behind that of emissions from energy use in terms of sophistication.

Emissions from the agro-industrial sector

About 29% of global emissions are associated with food production – about 13.5 billion tonnes CO2 equivalent per year, roughly the same as the annual emissions of China and India combined, or 10 times the emissions of the aviation sector.

A report ‘Silent but Deadly - Estimating the real climate impact of agribusiness companies’ released this week, publishes estimations of unreported ‘scope 3' greenhouse gas emissions for three companies – Cargill, Yara and Tyson. These are amongst the world’s biggest firms in the cattle feed, nitrous fertiliser and beef industries respectively.

In the negotiations in Paris emissions Scope 3 emissions cover indirect emissions, such as those associated with the upstream and downstream supply chains of operations.

These companies have been in denial. The report finds that their declared emissions are way below their actual emissions as seen in the following table:

Company	Declared annual emissions million tonnes CO2e	Actual annual estimated emissions million tonnes CO2e
Cargill	15	145
Yara	12.5	74.5
Tyson	5.2	34.22
Monsanto	2

Monsanto is not covered by this survey, which is why there is no figure for actual estimated emissions in the table above. However, it is a major player in the sector.

Monsanto in particular promotes through intense lobbying, lawsuits and aggressive marketing the above agro-industrial model; it is also largely responsible for the depletion of soil and water resources, species extinction and declining biodiversity, and the displacement of millions of small farmers worldwide.

Can agro-industry reform itself?

But now it seems that Monsanto has at least recognised the need for change. It announced last week that it plans to make its operations carbon neutral by 2021, in part by working with farmers who use its products to help them reduce carbon emissions, the company's CEO told The Associated Press.

To be carbon neutral means that Monsanto must reduce its net emissions of greenhouse gases to zero.

Farmers "have an opportunity and a part to play in mitigation around climate change," said its CEO Hugh Grant. "Rather than being the problem, I think there's a growing realization they can be a big part of the solution."

Let's hope so, but the record doesn't look good. Many of these big agribusiness companies have, this and last year, joined forces with the UN Food and Agriculture Organisation and the World Bank to promote Climate Smart Agriculture under the Global Alliance for Climate Smart Agriculture (GACSA). Members include Walmart, Monsanto and Yara.

Climate Smart Agriculture sounds great, but in fact there are very few significant social or environmental preconditions for joining GACSA21 or calling a particular agricultural practice 'climate smart'.

For example Yara promotes itself as a practitioner of Climate Smart Agriculture, but remains among the world’s biggest producers of nitrogen-based fertilisers (the worst type of fertiliser for its impact upon the climate).

Furthermore, Monsanto is due to go on trial for ecocide. The Monsanto Tribunal, which will be held in The Hague from 12 to 16 October 2016, will research and evaluate all of the many allegations made against Monsanto about the damages its products have caused to human health and the environment over the decades.

The tribunal, which is appealing for funds from the public, will also assess potential criminal liability on the basis of the Rome Statue that created the International Criminal Court in The Hague in 2002, and it will consider whether a reform of international criminal law is warranted to include crimes against the environment, known popularly as ecocide, or ecocide, as a prosecutable criminal offense.

Observers are therefore sceptical of GACSA.

Proven alternatives

The majority of civil society groups active on climate change support proven alternatives such as agroecology, changes of diet to include less meat, and food sovereignty as the only sure way to reduce emissions from the sector equitably. This means more organic growing, which nurtures healthy soil, and more vegetarianism.

Ultimately it means a shift to One Planet Living (as described in my book, see below) and an agro-ecological not agro-industrial food production and land/biodiversity/soil management strategy throughout the world.

But it's easier to change the behaviour of a handful of companies than millions of famers and consumers. Compared to changing agriculture, changing air travel to reduce emissions seems a doddle.

So what about air travel? It turns out according to an article in the journal Nature, that it is possible to reduce emissions from the majority of passenger aircraft by around 2% per year up to 2050 at zero marginal costs for per barrel oil prices between US$50-100. Larger reductions are possible but could impose extra costs and require using synthetic fuels. The industry will still need encouragement to change, however.

Whatever agreement is reached in Paris this week, there is no doubt that the lives of our children and grandchildren will be hugely different from ours. Whether that is by design or disaster is in the hands this week of our political and business leaders.

David Thorpe is the author of: