The economics and finances of regen ag -- an integrated perspective from Lauren Manning

[Linda Poole]

In an article at Ag Funder Network Partners, Lauren Manning brought home some of the complexities, opportunities and challenges for regenerative producers:

Having attended the first Regenerative Food System Investment Forum in 2019, one thing was clear during this year’s event – capital holders are spending less time asking why they should deploy capital in the space and focusing more on how and where they should deploy capital. Although this momentum is powerful and inspiring to witness, the road to financing more regenerative agriculture is not without its potholes.

That also means making flexible, patient, and non-extractive capital accessible for producers. Conventional agriculture is a risky business but for better or worse, our current system is built to give producers various financial safety nets whether they have a successful harvest or not. Until we have similar policies in place to give regenerative producers a hand, the capital community may need to help shoulder some of the risks that producers face – and often have little ability to control. This may look like concessionary capital, recoverable grants, philanthropically supported loan guarantees, flexible loan terms, land access support for historically disadvantaged producers, or purchasing agreements that spread risk across multiple supply chain stakeholders.

But the carbon narrative can overshadow so many other essential components of this conversation like biodiversity, revitalizing rural economies, improving farmer livelihoods and growing healthier foods. As I alluded to during my panel, 96% of farm households receive off-farm income and those earnings provided 82% of total income for all family farms in 2019, according to USDA ERS data.

What does it say about our society that the people who feed us rely on off-farm income to feed their own families?

The carbon narrative may also be blinding us from the importance of integrating health and nutrition into the regenerative agriculture movement. For many proponents, this space is about moving from a quantity-focused food system to a quality-focused one where food is also viewed as preventative medicine. And with this interdisciplinary approach comes an opportunity to engage in a broader array of asset owners and managers. Can we make room at the regenerative finance table for investors whose bottom line includes health, communities, and equity? It will be cheaper to invest in the transition to a more regenerative agriculture system than it will be to treat the diseases that are just a symptom of our broken food system.

There are many more salient points in this article -- it's well worth the time to read at https://agfundernews.com/regenerative-agriculture-is-anything-but-just-business

 

[emilyjost]

Great article, Lauren! This is no silver bullet as much as we’d all like there to be one.