Investing in Sustainable Agriculture

Investing in Sustainable Agriculture

We are facing increasing challenges in the global food and agriculture systems. These challenges force both public and private investors to consider investing in sustainable agriculture infrastructure development, innovative techniques and more efficient technology. Because of the waste of food, inefficiencies in infrastructure nutritional-related diseases, and climate change and many other factors sustainable agriculture is fast becoming one of the most popular issues in impact investing.

From farms to agri-industrial factories

In the past 200 years 90 percent of U.S. population lived on farms, and they created their own food for them to consume. If we talk to our children about what a”farm” is nowadays, we are talking about the farms we live in with them: a stunning place to live to various animals and a land that is cultivated by various crops. Also, we discuss what is possible using sustainable agricultural practices.

The reality is very different. Innovations and improvements in the agriculture system have allowed for farmers to increase their output by increasing their total input usage. Because of an efficient systems for food production that America U.S. produces almost as more than China but with a smaller population.

However, these changes come with a cost. We’ve moved away from the farms that were once owned by families to factories for agriculture with methods that focus on mass production, not sustainable production.

This is the issue that we face today How do we sustain the production of agriculture needed in order to provide food for the entire world, and preserve the sustainable practices of small farms run by family members? This is the reason why many impact investors are considering making investments in sustainable agricultural practices. To answer this question to feed billions of people, implement sustainable food practices that create an impact that lasts and also make money while doing it.

What is sustainable Agriculture?

Sustainable agriculture, also known as sustainable farming is precisely what it’s called farming in sustainable ways. What exactly does it mean?

The concept of sustainability generally is to satisfy the needs of the present without compromising the future. In the context of sustainable agriculture, it is the answer to questions such as:

Investing in Sustainable Agriculture

How can we manage the cultivating crops so that the world can have enough to eat and produce textiles, without depleting the resources that we have?

Examples of sustainable agriculture

There are a myriad of instances of farming that is sustainable practices that range from minor changes to massive processes and production changes. Whatever the instance is, it is important to keep in mind that sustainable practices require planning to be successful. The decision of what plants to grow and when to rotate from aquaponics to hydroponics, deciding how to water and nourish the plants each one requires an understanding, a lot of thought and planning. Some instances of sustainable farming are:

Crop Rotation

Crop rotation is a crucial method to ensure that the soil stays in good condition and prevent it from being depleted completely of nutrients. Different crops are planted in various places over the course of several years so that the subsequent crops help to replenish the nutrients that the previous one took from the soil, and in reverse.

Cover crops for planting

Cover crops are grown during the off-season when soils could otherwise be left barren. They protect and improve soil health by stopping erosion as well as replenishing soil nutrients and ensuring that weeds are kept under control.

Integrating crops and livestock

Industrial agriculture generally keeps plant and animal products separate from one another. Studies have shown that integrating of animal and crop production can result in an efficient and profitable method of farming.

Does “Sustainable” also mean that it’s Organic?

“Organic” or “Sustainable” aren’t used in the same way as synonyms. There are still certain guidelines in organic farming which are not sustainable and not all farmers using sustainable practices can be eligible to be eligible for USDA certification or decide to take it up.

Regenerative agriculture can take sustainability to a new level by not just conserving the land on which the food crops are grown but using farming practices that improve soil health and improve the natural ecosystem on the farm.

Corporate Farms in comparison to. Family Farms

Although commercial real estate costs have been rising in recent years in cities such as New York, San Francisco and Washington, D.C. so have the prices of farms. In the case of farming only a handful of big farms “produces the majority of our foods” According to U.S. Secretary of Agriculture, Tom Vilsack.

The largest farms with more than 1 million dollars in revenue represent just 4 percent of the farms, yet 66 percent of sales. It’s a huge increase from one percent for all farms as well as 50 % of all sales in the past decade. But, 3 quarters of U.S. farms gross only $50,000 annually and represent just 4 percent of total the sales of their products.

Making a commitment to sustainable Agriculture from 2020 onwards and beyond

Just a couple of years back, impact investing was mostly a publicity game for financial firms and other organizations to make themselves appear at ease with issues related to climate change, social wellbeing and inclusion. As we witness the growth of impact investing as well as the increase in the availability of better measuring tools and tools, investing in sustainable agriculture will soon be the norm.

What are the reasons sustainable Agriculture is in vogue

It’s becoming more widely known that the market for impact investing is expected to reach well over 14 trillion dollars in 2023. Affordable housing and community development, as well as sustainable energy , and health have been the main areas of impact investing. However, investments that are specifically in the area of sustainability for agriculture are still relatively small when compared with other investment categories that impact. This is mostly due to the absence of regulations of what constitutes “sustainable agriculture”,” confusion over sustainable versus organic farming, and other issues which have hindered precise comparisons.

However, sustainable agriculture sector is currently growing for different reasons and is expected to expect to grow in the coming years. A combination of the ageing out of farmers, increased demand for sustainable agriculture initiatives, and the reported allocations of investors to projects that are sustainable agriculture is leading to this increase.

Population Demands

The world’s population is growing at a rapid pace (10 billion in 2050) and we help more people get from poverty it is not just an increase in demand for foodbut also higher prices for food items such as dairy and meat. As our farmers’ average age increases to 58, and the output gains from”the “green revolution” have reached their highest and we’re required to find better solutions to ensure that we can sustainably increase the amount of agricultural output needed to provide food for the entire world.

The report Impact Investing in Sustainable Food and Agriculture Across Asset Classes that is led by Croatan Institute, Croatan Institute, the authors point out:

“Food and agriculture will always be bound by the limits of natural resources on a planet that is finite and that is experiencing rapid growth in population and urbanization, in the long run, soil degradation and scarcity of land as well as a growing gap in the access the resources.”

Transformation, LLC outlines these issues in our report regarding Global Agriculture. While Transformation was founded in 2017, the company is planning to launch an investment syndicate worldwide to solve global agricultural problems. The fund’s plans will be announced in full on June 12, 2019, during the AIM Summit in Geneva.

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