Argentina’s farmers go ‘carbon neutral’ to retain agriculture markets

“We are facing an important change for the entire Argentine productive sector. The challenge now is that at the end of an agricultural season we not only ask ourselves ‘How did your soybeans do?’ but also, ‘How did this year go with your carbon balance?'”

This is how Eduardo Serantes, representative of South American agribusiness organisation the Group of Southern Producing Countries (GPS), introduced the new Argentine Carbon Neutral Programme for agriculture, an ambitious private sector initiative that he hopes will give Argentina an advantage in international markets.

The Argentine carbon neutral agriculture programme aims to export food, beverages and bioenergies that will reduce and compensate for the amount of greenhouse gases (GHG) emitted during their life cycle.

It is not about selling an additional value, but about being on par with the new global demands

Created by associations of Argentina’s agricultural producers, the carbon neutral programme calculates the carbon footprint of each sector, and certifies the ‘carbon balance’ of their exports.

“There is a new productive paradigm that we have to start considering if we want to sell more,” said Sabine Papendieck, a business consultant. “Public and private standards have an impact on market access, our competitiveness, our production costs and the perception that consumers and marketing chains have.”

Papendieck acknowledged that rather than winning new markets, the programme designed to help Argentina keep its market share “Ten years ago, [environmental standards] were a plus, but today it’s about not losing markets. They are a condition of access demanded by European markets, but which is also beginning to be seen in countries like China,” she said.

Argentina finds itself in competition with neighbouring countries with an agricultural production such as Uruguay and Mexico, whose farmers have begun to adhere to stricter conditions on carbon emissions in the production chain.

José Martins, president of the Buenos Aires Cereal Exchange, agreed: “It’s not about selling an additional value, but about being on par with the new global demands for environmental certification.”

Although participation in the programme is voluntary, Martins is optimistic about the challenge its signatories are setting themselves.

“We managed to align the entire agribusiness chain and all the country’s exchanges in pursuit of one aim: to work to look after the environment, an issue that we are very worried about,” he told Diálogo Chino.

How to achieve “carbon neutral” food

A producer can generate greater efficiency through investment in clean technology, implementing direct compensation for its emissions via activities such as afforesting, or changing land use. Countries can also buy bonds that compensate for the carbon emitted. For Ramiro Costa, executive subdirector of the Buenos Aires cereal exchange, it is an opportunity for companies.

“We believe that there are clear benefits because consumer demand points towards this,” he said.

Companies that reduce their emissions can begin to be included in investment banks’ lists of green companies and receive financing at different rates, Costa said. “It’s not just about entering an international market, but also about productive and financial efficiency.”

New consumers

Be it the countries of the EU, the US or China, entrepreneurs must increasingly take into account environmental responsibility as a factor in the production, transport, storage and distribution chain of their products.

“Consumers in the vast majority of buyer countries are increasingly concerned about environmental issues and requests for environmental certifications are growing,” said Costa.

Even when developed countries reduce their territorial emissions, the import of incorporated carbon partially counteracts this

Miguel Ángel Cinquantini, coordinator of the Corporate Carbon Footprint Program of the Argentine Network of Municipalities against Climate Change (RAMCC), said: “Climate change is very present in consumers because it is a pressing problem.”

In China, many new consumers who care about the environmental impacts of the products they buy have emerged.

Ernesto Fernández Taboada, executive director of the Argentine-Chinese Chamber of Production, Industry and Commerce, told Diálogo Chino: “More than half of the Chinese population is already urban, the middle class grew and has a better quality of life. That allows them to try new products and broaden their diet. Those new consumers – young people – have a preference for organic products.”

For Fernández Taboada, products that are certified carbon neutral will soon be a reality for many producers. “The evolution of international markets, especially the Chinese one, is staggering.” 

The private sector and climate change

According to the latest national inventory of greenhouse gases, agriculture and livestock (along with forestry and other land uses) are responsible for about 40% of Argentina’s greenhouse gas emissions.

A reduction in emissions from these activities, as proposed by the programme, would help meet Argentina’s climate change mitigation objectives.

Likewise, countries that buy food and raw materials seek to reduce their “imported emissions”. 

The recent UN Environment Program’s Emissions Gap report noted: “The net flow of carbon incorporated goes from developing to developed countries. Even when developed countries reduce their territorial emissions, the import of incorporated carbon partially counteracts this effect”.

For Cinquantini, the 2015 Paris Agreement clarified that the private sector has a strong role in tackling climate change and the task can’t be left to national, local and provincial governments.

A total of 177 companies have pledged at COP25 climate summit to set ambitious emissions reduction targets to help limit the effects of climate change. The companies represent over 5.8 million employees, spanning 36 sectors and with headquarters in 36 countries.

Jorge Segura Mora, president of Planeta Carbon Neutral, a consultancy firm that grants environmental certificates to companies in Latin America, praised the initiative in Argentina: “In a world increasingly concerned about the future of the planet, we hope this programme will make Argentine products more attractive internationally.”

Argentina’s government has also praised the programme. Carlos Gentile, former secretary of climate change and sustainable development, said: “These are the kind of initiatives that the private sector has to promote. It is the way to show an x-ray of what the sector is and isn’t in terms of emissions.”