On November 8, Fonterra introduced a goal of 30% depth discount in on-farm emissions – so-called scope 3 – by 2030, from a 2018 baseline. At 86%, on-farm emissions make up essentially the most sizable a part of Fonterra’s GHG footprint, and the brand new goal is in search of to cut back their depth by ton of fats and protein-corrected milk collected by the co-operative. This will likely be carried out in a number of methods – by means of improved herd efficiency and feed high quality, novel applied sciences to sort out methane, carbon removals from vegetation, and land-use change conversions.
In highlighting a few of the challenges to bettering on-farm GHG emissions footprint, Fonterra chairman Peter McBride stated there was ‘important variation inside and throughout farming techniques in terms of emissions depth’. “There’s nobody answer to lowering on-farm emissions,” he stated. “It can require a mix of sharing finest farming practices and expertise to cut back emissions – it’s each our largest alternative and our largest problem.”
Fonterra’s scope 3 goal comes after near a yr of discussions with farmers about why it was wanted within the first place, and the way it may be achieved. On one hand, the co-op wants to satisfy market expectations, with CEO Miles Hurrell stating that “the co-op must maintain making progress to verify it doesn’t fall behind”.
However, a scope 3 emissions goal is essential to reaching any net-zero targets. As Kite Consulting sustainability skilled Hayley Campbell-Gibbons instructed DairyReporter, “Web zero targets are an end-goal to scope 3 discount targets and efforts. What’s essential is that any firm’s web zero goal should embrace all emissions scopes. The overwhelming majority of any massive meals firm’s emissions lie of their scope 3, so any goal that doesn’t search to handle that is largely pointless.”
There’s one other caveat – reporting on-farm emissions knowledge in depth phrases means tackling emissions per unit of output, i.e. kilogram of milk collected, moderately than setting one blanket, ‘absolute’ discount goal.
Requested why Fonterra selected to undertake an intensity-based goal for scope 3, a spokesperson for the co-op instructed us: “Absolute emissions check with the whole quantity of greenhouse gasoline being emitted. Depth compares the quantity of emissions to a unit of output, for instance per kilogram of milk solids. While we’re setting an depth goal, we’ll proceed to report yearly on our discount in absolute emissions, which have diminished by 1.85 million tonnes of CO2e (-6.9%) since 2018.”
The spokesperson added that Fonterra has submitted its targets for validation with the Science Primarily based Goal Initiative (SBTi) in alignment with the target of retaining international warming under 1.5°C.
“The intensity-based strategy isn’t novel or new with different comparative worldwide corporations equivalent to Cargill, Glanbia, Kerry and Tyson Meals having intensity-based approaches. In New Zealand, it is usually utilized by Synlait and Olam,” the spokesperson concluded.
Depth-based targets make enterprise sense – however are they formidable sufficient?
In line with the Intergovernmental Panel on Local weather Change (IPCC), restraining emissions in absolute phrases is what the planet wants. In its particular report entitled World Warming of 1.5°C, the IPCC concludes, leaning on present analysis, that “[m]ost interventions that enhance the productiveness of livestock techniques and improve adaptation to local weather adjustments would additionally cut back the emissions depth of meals manufacturing, with important co-benefits for rural livelihoods and the safety of meals provides (Gerber et al., 2013; FAO and NZAGRC, 2017a, b, c). Whether or not such reductions in emission depth end in decrease or larger absolute GHG emissions depends upon general demand for livestock merchandise, indicating the relevance of integrating supply-side with demand-side measures inside meals safety targets (Gerber et al., 2013; Bajželj et al., 2014).”
With demand for dairy projected to extend sooner or later, limiting manufacturing isn’t an possibility for processors, who’re aiming to satisfy this demand whereas lowering their environmental footprint on the similar time. In that sense, intensity-based targets can supply a balanced strategy, however are they environment friendly sufficient to sort out local weather change?
We contacted the Carbon Disclosure Venture (CDP) for some background data on the topic. CDP is a nonprofit group that runs a worldwide environmental disclosure system for companies and public organizations, and holds the biggest environmental database on the planet, having scored greater than 15,000 corporations, together with Fonterra, Danone and Yili.
Requested which sort of goal is perfect for the local weather, a CDP spokesperson instructed us: “Depth targets are an vital stepping stone in corporations’ decarbonization journeys, however they don’t all the time result in absolute reductions, subsequently absolute emissions reductions targets are higher for the ‘greater image’ by way of lowering emissions globally.”
They added that as a normal rule, depth targets are higher for homogeneous industries equivalent to cement or metal, because the merchandise and life cycle emissions are related and thus simpler to match. “These industries are inclined to have fewer massive gamers that dominate the market, thus if the business all strikes in a path to zero emissions depth it’s extra seemingly that absolute emissions reductions will comply with. Whichever targets are adopted (close to time period absolute and depth targets) they need to be formidable and allow the corporate’s transition to a net-zero [2050] future.”
This isn’t a lot the case for dairy, the place manufacturing strategies and product sorts differ. And why we confirmed with CDP that absolute targets can be extra formidable and make a better impression on emissions reductions, SBTi’s forest, land and agriculture steering (FLAG) has been designed particularly with land-intensive sectors in thoughts.
“For depth targets to make sure high-level of ambition comparability and to attenuate the prospect of inflated progress a corporations should use the proper metric,” the CDP spokesperson added. “In terms of corporations on this sector setting a goal, they need to comply with the steering from FLAG to help them in setting science-based targets.” To that finish, Fonterra’s scope 3 targets are FLAG-compliant.
“Since 2022 [the launch of SBTi’s FLAG guidance, ed.], there was a 1.5°C aligned, credible emissions depth pathway obtainable for the sector. Nevertheless, these depth convergence pathways require a minimal 3.1% annual absolute discount and are relevant to brief time period (2020-2030) targets solely. These commodity pathways – depth targets – are solely relevant to the corporate’s FLAG emissions; fossil emissions (e.g., from transport) can’t be included.”
“At present, it’s troublesome to eradicate greater than 80-90% of emissions throughout any business, so the remaining hard-to-abate emissions are a difficulty throughout all business/ sectors. This doesn’t imply that corporations ought to postpone beginning to measure and handle their scope 3 emissions. Corporations that report by means of CDP disclosed their provide chain emissions are the largest contributor to greenhouse gasoline emissions – accounting for a mean of 11.4x extra emissions as in comparison with operational emissions.”
An information-driven strategy
Fonterra instructed us it has been measuring every farm’s environmental with a view to supply farmers particular insights into how every producer can transfer the needle on sustainability, with out compromising their profitability and productiveness. “Yearly, our farmers obtain a Farm Insights report that’s customized to their farm and provides a view of their farm’s effectivity,” a spokesperson for the co-op instructed us. “We’ve been producing these reviews for the previous few seasons. The reviews flip knowledge from milk high quality and manufacturing, Farm Dairy Data, and business analysis into insights that farmers can use to fine-tune productiveness, profitability, and sustainability.
“The reviews may give farmers a greater understanding of their farm’s emissions, benchmarked in opposition to different related farms.”
There’s additionally a workforce of ‘on-farm sustainability daring advisors’ obtainable to help farmers in making environmental adjustments, we had been instructed. “This yr, we launched a brand new farm effectivity overview, in addition to a milk manufacturing web page that appears at manufacturing per cow. That is to provide farmers a greater thought of what’s taking place on farm, and the way their farm compares to others within the co-op. We’re working in direction of each farm having their very own Farm Surroundings Plan by 2025.”
The spokesperson added that on-farm emissions for the entire enterprise had been calculated yearly since 2004, utilizing a lifecycle evaluation mannequin that considers all emission scopes related to the co-op’s milk manufacturing. “This reporting is finished utilizing AgResearch so is impartial of Fonterra. Utilizing this reporting we can get an correct image of any change in emissions throughout milk provide base,” they defined.
Requested if farmers will obtain monetary incentives for embracing sustainable farming strategies, Fonterra’s spokesperson stated: “In the mean time, we gained’t be incentivising our farmers for emissions effectivity. Nevertheless, most of the good practices which are recognised by means of the Co-operative Distinction additionally end in emissions effectivity.”
The Co-operative Distinction is a company program Fonterra runs that rewards farmers for ‘practices that help the long-term success’ of the co-op, together with farming effectivity enhancements and actions related to regenerative agriculture practices, equivalent to pasture administration. “The Co-operative Distinction fee encourages farmers to undertake new and rising practices and is achieved by means of differentiating the value our farmers are paid for the milk based mostly on the practices adopted on every farm. A major variety of our farmers have been receiving this fee at some stage, which is a superb indication of the high-quality milk and good on-farm practices being carried out,” Fonterra’s consultant instructed us.
Apart from bettering farming effectivity, the co-op is relying on new applied sciences to assist it transfer the needle. This consists of growing its personal methane-inhibiting feed, Kowbucha, which was anticipated to launch in 2024 however Fonterra was coy on confirming this. “It has been proven in repeat trials that Kowbucha can cut back methane emissions whereas bettering feed effectivity in younger dairy cattle by as much as 20%,” the consultant instructed DairyReporter. “At present, we’re investigating if the results of Kowbucha prolong to lactating cattle whereas additionally making ready for the regulatory course of that’s required by the New Zealand authorities for all merchandise making methane claims. The time to succeed in market will likely be ruled by the regulatory approval course of.”
There’s additionally ongoing work on a so-called methane vaccine, which is being led by three way partnership AgriZeroNZ, additionally behind different long-term tech R&D. “AgriZeroNZ is a long-term partnership with business companions and over the subsequent three years we’ve dedicated to take a position $50 million,” the spokesperson instructed us. “Since being established lower than a yr in the past, it has made 4 investments into vaccines, inhibitors and probiotics. There are one other 59 initiatives on the radar.”
Along with discovering options, work within the regulatory house is ongoing to permit for brand spanking new options to be accessible to farmers and in addition the growth of Fonterra’s GHG testing amenities in New Zealand.
Concluding, the Fonterra spokesperson stated: “Proper now, Fonterra is without doubt one of the world’s lowest carbon suppliers of dairy at scale, nonetheless there may be a variety of exercise throughout different markets to cut back emissions to satisfy their targets.
“Our local weather roadmap outlines the actions we’ll take in direction of our 2030 targets and our ambition to be web zero in 2050. Alongside the best way we’ll sort out some important milestones together with phasing out of coal by 2037 and 100% of farmers having a Farm Surroundings Plan by 2025.
“It is usually our perception is that from New Zealand’s low emissions place to begin, our continued enhancements will make us the only option for our clients to speed up their journey to a web zero future.”