Sustainability — Will It Change Agriculture

Kurt LawtonFarmers, Industry News, sustainability

Is sustainability reshaping agriculture? Will it affect your operation? That debate was front and center at a Case-IH sponsored forum during the recent Ag Connect Expo.

“We recognize sustainability is a huge buzz word, it means a lot of things to a lot of people, and one panel discussion won’t answer all the questions surrounding this issue,” said Jim Walker, Case IH vice president, North America. “But we need to have the conversation. Sustainability is at the core of a national debate about how we meet demand for food, feed and fuel while maintaining consumers’ trust in agriculture.

“At Case IH, we recognize that ag sustainability is a balance between agronomics, economics and the environment. And we’re committed to helping North American farmers create more value from sustainable farming systems,” Walker added. “That’s why we brought together a top-notch panel of nationally known experts to provide their unique perspectives on how sustainability will affect farmers.”

Expert panelists included: Annie Weber, Senior Vice President and General Manager, Roper Public Affairs of GfK Research North America; Bruce Knight, Principal and Founder, Strategic Conservation Solutions; and Jim Nussle, President and CEO, The Nussle Group.

The consumer perspective on sustainability
Weber, who specializes in helping food and farming clients track consumer trends and better understand consumer trust, began by saying that farmers need to view themselves as a consumer-facing business. “In the past decade, there’s been a technological revolution that has empowered consumers to communicate, capture images and share opinions,” she said. “We also have an environmental movement that’s gone mainstream, and it isn’t going away. And we have another huge consumer trend, which is Americans’ focus on health and wellness through diet and lifestyle choices. And fourth, there’s a low-grade chronic skepticism about the motivations of business, particularly big business and large institutions.”

Next, Weber explained what sustainability means to the average American consumer. “Environmentalism, the green movement, sustainability, even corporate social responsibility — it’s all kind of the same thing. It’s recycling, taking care of the environment, being good with resources, possibly eating organics, and locally grown food. That’s about the depth of their understanding, which is important when you’re communicating with consumers, to know what they do and don’t know yet,” she continued. “Americans’ brand of environmentalism is incredibly practical. It’s almost a mindset about being thrifty, and taking good care of my family, and being safe.”

Weber said the good news is, in terms of favorability, “Agriculture comes out on top. Americans hold farmers in a special place. You’re part of our heritage. They really are very favorable and positive about you.”

She recommended that farmers find shared values with consumers and focus on connecting with them. “You share a lot of values – in terms of thrift, hard work, taking care of resources. If you want them to support you and not have restrictions come down on you, it’s critical they know you as individuals, and know what agriculture is all about.”

Weber described two things the American public demands: “They want authenticity. They want to know who you are,” she explained. “You don’t have to be perfect, but you do have to be open, and show that you’re trying to be the best you can be. And you have to be transparent. Nothing today will set consumers off and make them more suspicious than a lack of transparency. It’s probably a losing battle to think you can batten down the hatches and not invite them in for a conversation.”

A view from the industry
A nationally recognized expert in conservation, agriculture, and the environment, Bruce Knight is a principal and founder of Strategic Conservation Solutions. Knight previously served as Chief of the U.S. Department of Agriculture’s (USDA) Natural Resources Conservation Service, and as USDA’s Undersecretary for Marketing and Regulatory Programs. He’s also a third-generation rancher and farmer, operating a diversified grain and cattle operation that uses no-till and rest rotation grazing systems and wildlife management.

Knight said over the last 25 years, the term sustainability has grown increasingly mainstream – and confusing. “There are many different sustainability claims, about environmental goods and services, about clean air and clean water. And because of the climate change debate, you’re seeing claims about carbon and carbon sequestration. There are sustainable claims on animal care and animal welfare, as well as labor and treatment of farm workers. Sustainability also has to do with ‘community attributes.’ That may be locally grown, or how one interacts with the community.”

He said checkoff leaders are heeding consumer demands for sustainability, and are starting to make investments and showcase sustainability efforts. Some organizations are taking a positive approach, some industries are playing defense. The furthest ahead are the U.S. dairy industry and the U.S. wine industry. “In the case of dairy, sustainability has been an industry-wide approach involving farmers, dairy cooperatives, processors and retailers,” Knight explained. “They’re poised to respond to consumer concerns about air quality, carbon, or water quality by having done that full value chain assessment.”

According to Knight, the organics movement 10 or 15 years ago had the same clutter of multiple definitions and claims. “They decided to go to Congress to legislate one nationwide organics standard. I’m not advocating that for sustainability,” he continued. “But there will undoubtedly be people pushing for that. The challenge for American farmers will be deciding if they want one government-based standard or standards, or industry-led, industry-defined standards.”

Knight said a group called Keystone is developing a sustainability initiative that commercial agriculture will be comfortable with. “In their emerging definitions of sustainability, things like biotechnology are okay. It’s not about reduced fertilizer use. It’s about fertilizer efficiency and wise use of fertilizer. Tools like precision agriculture would be allowed. They haven’t tackled the thorny issues, to my knowledge, on livestock. But for all of us, this is the challenge we’ll be wrestling with over the next few years.”

The political view of sustainability
President and CEO of The Nussle Group, Jim Nussle previously served as Director of the White House Office of Management and Budget for President George W. Bush. He also represented Iowa for 16 years in the U.S. House of Representatives. He began his introductory comments during the Case IH VIP sustainability panel discussion by warning, “You’re focused on your business, your bottom line – your farm. You’re not focused on public policy in Washington. But public policy is focused on you.

“And it’s not necessarily driven by fact,” he added. “It’s based on emotion. It’s based on, sometimes, fads and trends. We don’t know what perspective it’s going to carry. But public policy is coming after you next. And it’s coming from places you probably aren’t familiar with.”

Nussle told farmers to think beyond the USDA and the Agriculture Committee. “Now the EPA is involved. The Department of Energy is involved. You will see the White House much more involved than ever before when it comes to farm policy, trade policy, environmental policy, tax policy, policies that affect you and your economic bottom line.”

He said we’re also having this conversation about sustainable agriculture during a very distracted time. “We have the largest deficit now that our country has ever faced. We have the largest national debt, which we owe to countries overseas. We’re in an economic downturn, and we’re not growing jobs. We lack a predictable commitment to renewable biomass energy. We’re in an era where taxes are going to go up, where regulation is becoming rampant. Everyone believes we should be better to the environment. But is there clarity on exactly what direction that’s heading? No. We’re not even close to that.”

According to Nussle, most farmers probably don’t sell directly to the consumer. “But we are impacted every day by what is going on in the minds of the consumer. And right now, they’re agitating about this word sustainability, not only in terms of agriculture, but across the board in many different industries.”

Industry-led sustainability solutions
Knight also said to watch Walmart, which has given all its suppliers a 14-point questionnaire on sustainability and traceability. “That will ultimately ripple down to farmers,” he explained. “When you get into cotton, rice, corn and soybeans, where our commodities become ingredients for everything from food to toothpaste, you’ve got a very different challenge ahead.”

He said if there’s an industry-led solution for defining sustainability, “You can try to get that formalized either at USDA or FDA. Or simply start moving forward with the associated marketing. And there are relatively few restrictions, as long as you don’t make health claims.”

Weber added that when farmers make these arguments, “You have to make sure the public stays on your side. If you want an industry-led definition, mothers need to see and hear that you’re doing the things they care about right now. People today are very keyed on this idea of local – it’s very powerful with consumers today. Open up your farm to school visits, so they get to know you, know what you’re about, what your values are, and what you’re already doing to make sure everything is sustainable and healthy. So when there are arguments from different fringe groups about how things should be defined, consumers already know you, and will more likely be on your side.”

Knight said any definition of sustainability must be practical. “You don’t need something that says you can’t use fertilizer or pesticides. The second challenge is that if something emerges on sustainability, if there’s a marketing claim associated with it, that it needs to be transparent and the transaction costs must be low.”

Weber agreed, but added that farmers need to avoid being defensive, and focusing too much on business logic vs. what consumers care about. “What’s driving concern about all these issues is protecting family and health. So when you’re suggesting any kind of policy that would be more about business or protecting the environment, but it leaves out consumers’ major health concerns, you can lose battles.

“There is an opportunity to deepen the relationship that America has with farmers. Because Americans care about these issues more than ever, they want to know now where their food comes from,” Weber said. “Use that opportunity and leverage it, and make the point that farmers were the first environmentalists.”

Economic sustainability
Knight sees another opportunity within the sustainability movement: Market-based incentives for environmental goods and services. “Farmers produce crops. But we also produce goods and services that society gets for free. Clean water, healthy soil, clean air, wildlife habitat. Those are outputs from our farms and ranches.

“We’re seeing trading of water quality credits in many areas. You see trading of dollars from private developers to farmers for restoration and preservation of wetlands. It’s a lofty goal, and we’re a long way from getting there, but there is an opportunity to create a market for environmental goods and services.”

Nussle cautioned that sustainability solutions must be economically sustainable for farmers. “Let’s say it improves the environmental quality, the food quality, the community quality. If it doesn’t, at the same time – and possibly exponentially – increase the economic viability of this model, then it won’t work.

“So the opportunity is that we might be able to get a better, more predictable economic model in agriculture. As policy makers, I think that needs to be taken into consideration, as well as industry, as you are coming up with sustainability definitions.”

Walker wrapped up the discussion, and thanked the expert panelists for a great conversation and thought-provoking commentary. “I think most of us have more questions than answers now, but this was a great first step. The next step will be moving forward as an industry, working together and answering those questions.

“At Case IH, we take sustainable agriculture very seriously,” Walker added. “We’re on the forefront of delivering innovative products necessary to lead producers’ drive for sustainable agriculture achievement. Case IH agronomists, product specialists and technical support professionals work alongside our dealers and directly with our customers – one-on-one, in small groups and in the field – to help drive toward that agronomic, economic and environmental balance. It’s all aimed at delivering an exceptional customer experience and meeting your demands for sustainable ag solutions over the long-term.”