In the new policy forum article, the authors explain how agricultural value chains can incentivize small- and medium-sized farmers to be climate smart.

EAST LANSING, Mich. — A newly published policy forum article in the journal Science from Michigan State University Distinguished Professor Thomas Reardon details how leveraging agricultural value chains can help farmers implement climate-smart practices.

The article was coauthored by Jo Swinnen, Director General of the International Food Policy Research Institute, and Loraine Ronchi, Global Lead for Science, Knowledge and Innovation in Agriculture and Food of the World Bank Group.

Reardon is an economist in the MSU Department of Agricultural, Food and Resource Economics whose work is supported in part by MSU AgBioResearch. He is a world-renowned expert on the transformation of agricultural and food value chains and how they affect food industry business strategies, farms, employment and nutrition.

In the article, the authors highlighted several aspects of agrifood value chains (AVCs), which they refer to as systems that move food from "farm to fork" — agriculture upstream to post-farmgate segments such as food distributors and processors to consumers.

The authors note that agrifood systems in general, and AVCs in particular, have been for decades at the margins of the world debate on mitigating climate challenges. The 2023 United Nations Climate Change Conference (Conference of Parties 28, or COP28) changed that by highlighting the central role of agrifood systems in fueling climate change via greenhouse gas emissions and other problems.

There is a need to help agriculture be "climate-smart," mitigating climate challenges and helping farmers to be resilient to climate shocks. The COP28 issued a declaration signed by 160 country leaders called the Emirates Declaration on Sustainable Agriculture, Resilient Food Systems and Climate Action.

"Despite the recent attention to agriculture and agrifood systems as a climate problem, there is widespread pessimism in international circles about agriculture becoming part of the solution," Reardon said. "There is a generalized fear that millions of small- and medium-sized farms that form the greater part of world agriculture will have the incentives and capacity to change their farming practices, even if governments enact regulations and world conferences make declarations."

Because of this, the focus of hope and action for climate change mitigation has been on non-agriculture sectors that are more concentrated, with large-scale actors such as transport and energy, that can be regulated more feasibly.

Reardon said the central point of the article is that AVCs can be harnessed to help — in terms of incentivizing and capacitating — small and medium farmers to adopt climate-smart practices.

"This point has two dimensions," Reardon said. "On the one hand, both large food companies and small and medium companies worldwide have the tools to help farms. For years companies have worked with small and medium farms, providing them with incentives and capacity building such as credit, training and information to supply what the companies want. In the past the latter has been focused on consistency of supply volumes, on product quality and on food safety. We note that companies already do and can do much more providing this same kind of help to farms to shift to climate-smart practices."

On the other hand, the authors contend that companies have business motivations to apply their tools of trade to help farmers to be climate smart. A relatively minor motivation is to meet requirements of rich-country markets where climate-conscious consumers and regulations reward companies to do this. But on a global scale, that market is small.

Much larger is the overall food market in both the Global South (low- and middle-income countries), as well as in richer countries where consistent supply of food at affordable prices is important not just to the vast majority of consumers but to the food companies.

The authors argue that it is not necessary for companies to work with their farmer-suppliers because the companies have explicit climate goals but because the companies have product volume and cost goals.

"Companies want dairy farmers to control methane emissions because that actually increases cows' milk yields and lowers dairy costs," Reardon said. "They want fruit producers to control water use because that lowers overall product costs. They want their farmers to use efficient irrigation systems for the same reasons. And because they have the tools to sway and help farmers, these companies in AVCs can be important actors. For example, a global company operating in California rewards growers for implementing drip irrigation in tomato production to improve water-use efficiency."

The article emphasizes that universities and national and international agricultural research institutes have a crucial role to play in supplying applied science solutions to help farmers comply with climate-smart practice requirements of companies in the AVCs.

They can make the technologies farmers use more affordable and in line with climate-smart practices such as breeding climate-resilient crop varieties and forages that increase efficiency of feeds and reduce greenhouse gases, inventing techniques that reduce erosion and increase flood control, and much more.

Finally, the authors provides policy recommendations focusing on aspects that have been so far neglected in climate policy discussions. For example, governments can regulate climate accountability and extend regulation to the whole value chains, much like what's being done with the European Union Deforestation Regulation. Governments can also fund de-risking of private sector investments in measures companies use to support farmer adoption of climate-smart practices, such as applied research and development, training and local infrastructure.

To read the full article, visit science.org/doi/10.1126/science.adr6193.

Michigan State University AgBioResearch scientists discover dynamic solutions for food systems and the environment. More than 300 MSU faculty conduct leading-edge research on a variety of topics, from health and climate to agriculture and natural resources. Originally formed in 1888 as the Michigan Agricultural Experiment Station, MSU AgBioResearch oversees numerous on-campus research facilities, as well as 15 outlying centers throughout Michigan. To learn more, visit agbioresearch.msu.edu.