Farmers need to take action now to meet green ambitions – HSBC

Farmers need to be prepared to take action now in order to achieve the green ambitions required for net zero in the agriculture sector by 2050, according to new research undertaken by UCL and released by HSBC UK today (April 15).

The report, UK Agriculture: Pathways to Net Zero which was led by Dr. Carole Dalin, examines the importance of reducing net agriculture emissions of greenhouse gases and how farmers can achieve this through changes to farm management.

The agricultural sector is both vulnerable to climate change and a strong lever for mitigation and adaptation.

The government, regulators and consumers are increasing demands to implement sustainable practices to reduce emissions.

This presents a unique challenge to farmers who need to maintain productivity and profitability from their core activity as food producers, while also navigating changes in support levels and regulations post Brexit.

The research shows that a long-term focus on sustainability matters is needed, and farmers must have a better understanding of their farms performance, including greenhouse gas (methane, nitrous oxide and carbon dioxide) emissions and carbon capture accounting.

A detailed investment plan is essential if farmers are to secure growth in the future, as well as reaching the government’s net zero goals.

Some of these changes will have an immediate impact on productivity as well as emissions, while others may take time to pay dividends on farm returns.

Actions should include targeted measures to reduce emissions, capture carbon and the shifting of operations towards renewable energy and bioenergy, including:
  • Measures to improve productivity and efficiency – such as more efficient use of fertilisers, improved manure management to reduce nitrogen loss or improvements to livestock and arable production practices;
  • Appropriate planting of trees, protecting and restoring habitats and soil;
  • Generating and utilising renewable energy;
  • Growing appropriate bioenergy crops to increase crop diversity and income;
  • Developing future technology and becoming societal leaders on changes to diets and reduction of food loss and waste.

The report finds that farmers are making progress with their green ambitions towards net zero, but to achieve these ambitions there needs to be a co-ordinated effort from the whole industry, government and financial institutions to make significant changes to the sector.

£1.2 billion fund for the agriculture sector

HSBC UK recently launched a £1.2 billion fund for the agriculture sector as part of its nationwide SME Fund to support businesses as they bounce back from the pandemic.

Martin Hanson, head of agriculture for HSBC UK commercial banking, said: “Farmers need to be prepared to make tough investment decisions in the short-term.

“That will put them in the best position to drive growth sustainably in the future.

A ‘wait and see’ approach puts them at risk of being left behind, as the wider food industry changes and higher standards are demanded.

“We have always taken a long-term view of our customers in the sector and understand that farming is cyclical and can be impacted by external factors beyond a farmer’s control.

“Although new environmental schemes for farmers are to be announced in the coming years, taking steps to incorporate green practices now will move producers in the right direction, allowing them to take advantage of this new support when it arrives,” he concluded.