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Large-scale farming and environmental sustainability

28 August 2019

Large corporate farms are often accused of having a damaging impact on ecology and contributing heavily to climate change. Industrial farming, in particular livestock farming, is increasingly associated with global warming, soil and water contamination, overproduction of waste and deforestation. However, in recent years, fostered by heavy social pressure and the development of innovative technologies, agroholdings in different countries have been investing in minimizing the harmful effects of large-scale operations on the environment and reducing resource use intensity. Although many of these projects are in their fledgling stage or require further scaling-up, has collected publicly available evidences of agroholdings’ activity in ensuring environmental sustainability and efficiency of resource use. 

Energy efficiency

One of the activity areas in optimizing resource use is the reduction of electricity and natural gas use intensity in conjunction with switching to renewable energy sources. The measures that agroholdings implement in this area help to reduce both their dependency on fossil fuels and production costs. For example, Brazil’s largest meat producer BRF reports that 93.79% of energy consumed by its subsidiaries in 2018 came from renewable sources. Another Brazil-based meat producer Marfrig installed a wind generator at its subsidiary Tacuarembó Production Unit in Uruguay in order to replace part of the thermoelectric power purchased from the public supply company. The plant currently generates up to 16% of the electricity it consumes.

Another example is Russian agroholding Rusagro, which managed to decrease electricity consumption 10% and heat energy consumption 17% in 2018 as compared to 2017. The company links such reduction to a new energy saving equipment and LED-based lighting it installed at its production and processing facilities.

Waste management

Construction of biogas facilities has become the way to address the problem of waste utilization in agriculture. However, it is not always technically possible and cost-effective to produce biogas from waste. An alternative way of waste utilization is solid fuel production. Large-scale farms often use animal and plant-based waste to produce biogas and fuel bricks for further electricity and thermal energy production. For example, Ukrainian poultry-producing agroholdings MHP and Gals Agro have invested $ 31 million and $ 24 million, respectively, in the construction of biogas plants on their premises over the past three years. Another Ukrainian agroholding Nibulon produces fuel bricks from oilseed residues. Argentinian agroholding Adecoagro uses sugarcane bagasse and cow manure to generate renewable energies. Another example of waste management is brought about by Russia-based pork producer Cherkizovo, which prevents soil contamination from animal wastes by using monolithic floor at its pig farms.

Water management

Cases of large-scale farms being accused in mass media of over-exploitation of water resources and polluting the neighboring waters by, e.g., discharging untreated effluents into them are not infrequent. In response, more industrial farms are searching for ways to reduce water use and the volume of wastewater, as well as to improve the quality of effluent treatment. For instance, a large Brazil-based meat producer and processor JBS reports to have invested over $ 16 million in improving its effluent efficiency in 2018. Currently, 81% of the water used by JBS’s subsidiaries is treated. Ukraine-based world’s largest sunflower oil producer Kernel intends to build a thermal power plant on the premises of its new oil refinery plant. The power plant will transform effluent into steam with further energy production. This way, the company expects to completely prevent wastewater discharge.

GHG emissions management

FAO’s report on greenhouse gas emissions in 2014 showed that emissions from agriculture, forestry and fisheries operations nearly doubled over the past fifty years and might grow by an additional 30% until 2050, unless joint action is taken.  Except for the abovementioned measures like introducing energy saving technologies or installing innovative equipment that also contribute to the reduction of greenhouse gas emissions, several agroholdings report to have made additional steps in this direction. For instance, the logistics subsidiaries of JBS, JBS Transportadora and JBS USA Carriers, as well as the pork, poultry and beef businesses of JBS use a specific software program for route optimization in order to reduce GHG emissions. As reported by JBS, correct routing can reduce the number of vehicles used, the distance traveled, fuel spending and freight costs by about 40%. Meanwhile, another Brazilian meat manufacturer, BRF, has planted 31,802 hectares of renewable forest across Brazil in order to mitigate its impact on environment.

Soil resources management

The latest research from the University of Toronto suggests there is a global trend towards declining the diversity of crops cultivated by large farms worldwide. Agroholdings are blamed for violating crop rotation schemes and cultivating the same, most profitable crops on the same farmland from year to year. So far, 50% of the world’s farmland area, operated by large farms, is dominated by just four cash crops - soybeans, wheat, rice and corn. Monoculture farming is believed to cause soil depletion, reducing yields and increasing the risk of susceptibility to pests or diseases among crops.

In response, agroholdings report of introducing precision farming technologies like GPS, self-driving machinery equipped with sensors, drones performing aerial surveys, preparation of crop yield maps and soil analysis. Although the role of these technologies in reducing the effects of monoculture farming on ecology is still under-researched, they help agroholdings to increase efficiency and reduce the use of resources such as fuel, chemicals and fertilizers. For instance, Ukraine-based agroholding IMC developed crop yield maps for 43% of its farmland area and conducted an agrochemical analysis for the area of 9,000 hectares in 2018, being now able to precisely calculate the fertilizer input for this area. Meanwhile, Argentinian agroholding Adecoagro uses biofertilizers in sugarcane and feed crops production to improve the balance of soil nutrients and reduce fertilization costs. In addition, the Ministry of Agriculture and Rural Affairs of China reports that 84% of Chinese family farms, which are larger than the traditional household farms, use less fertilizer per hectare than the smaller farms in the same region due to better control procedures.

Staff training

Implementation of efficiency and environmental projects requires investing in staff development. Informing staff of a company’s environmental protection strategy or training of employees, who are going to operate equipment at a newly launched biogas plant or effluent treatment plant, are obvious processes that minimize the risks associated with introduction of new technologies. Some agroholdings go even further and create specialized departments within their organizational structures to deal with environmental issues. For instance, Ukraine’s MHP employs a team of 15 environmental specialists, responsible for preventing possible environmental incidents related to the company’s activities. Ukraine’s Nibulon has its own department of environmental protection that deals with efficiency of resource use, production of renewable energy and introducing environmental policy to the company’s subsidiaries.

A constantly growing global population implies an increased demand for food in the upcoming years, which cannot be fulfilled solely by smaller farms. In coexistence with small and medium farms, large farms can be viewed as essential factor of ensuring global food security. However, numerous alarming reports of scientific, voluntary, mass media and international donor organizations draw attention to the impact that intensive agriculture has on environment. In this situation, a substantial effort should be put into the development and realization of adequate environmental sustainability policies as well as into reasonable reconsideration of existing farming practices by all involved parties.