In the constant quest to improve the environmentthe health of the agricultural soils is an issue to take into account.
The revitalization of soils not only promotes a greater biodiversity y water conservationbut also contributes to mitigating climate change and strengthen crop resilience. This transformational change is known as regenerative agricultureThe Greg GoodwinDirector of Precision Conservation Management for the Illinois Corn Growers Association, and John StackhouseSenior Vice President, Office of the Chief Executive Officer, Royal Bank of Canada, in an article in World Economic Forum.
However, the transition to the regenerative agriculture faces a common but crucial challenge: the financing. For many farmers, this transition is not only an environmental issue, but also a business decision. The shift from conventional practices to regenerative agriculture involves a significant investment in time, labor and money.
“Los agricultores han adoptado prácticas agrícolas y de producción de alimentos climáticamente inteligentes durante décadas, pero ahora es el momento de que los líderes empresariales y los responsables políticos los apoyen plenamente”, expresa Dave McKay, presidente y director ejecutivo del Royal Bank of Canada.
This involves supporting coordinated initiatives that help the agri-food sector to reduce the emissions and find additional ways to financially reward farmers for their preservation efforts, not just for production, he stresses.
The report “100 millones de agricultores: modelos innovadores para financiar una transición sostenible”of World Economic Forum y Bain & CompanyThe report highlights how this short-term economic obstacle can represent a risk for rural men.
It indicates that during the early years of transition, costs may increase due to changes in technology and inputs, as well as temporary yield losses. However, as soil health improves, farmers may experience greater resilience and, in some cases, higher yields.
The report, which came out of the World Economic Forum's 2024 Annual Meeting at the World Economic Forum in Davosproposes a financing and collaboration model that benefits all stakeholders: farmers, financial institutions, agribusinesses and more.
To assist farmers in this transition, it is crucial to provide them with a network of financial security adequate. This could include down payments, guarantees, loans or insurance on favorable terms that reduce risk during the first few years of change.
In addition, this financial support should be part of a broader package of services that includes technical assistance and measurement, reporting and verification services.
It is essential, the document stresses, that this support be flexible and adapted to the individual needs of each farmer.
Source: World Economic Forum