Animal feed is a massive source of Scope 3 emissions for food companies and retailers, representing the vast majority of their total carbon footprint. For feed buyers, particularly those purchasing soybean meal, building a low-carbon soy supply chain is no longer a “nice-to-have” but a strategic necessity for meeting corporate climate goals, satisfying consumer demand, and complying with emerging regulations. This process requires a proactive approach that extends beyond the factory gate, reaching back to the farm where the soybeans are grown.
What Are Scope 3 Emissions?
Greenhouse gas (GHG) emissions are categorized into three scopes. Scope 1 covers direct emissions from sources a company owns or controls, like its own vehicles or on-site fuel use. Scope 2 includes indirect emissions from the generation of purchased electricity. Scope 3, however, is the most complex and significant category for the agricultural sector. It includes all other indirect emissions that occur in a company’s value chain, both upstream and downstream. For a feed buyer, this includes:
- Upstream emissions:
- Farming activities (fertilizer production and application, on-farm energy use).
- Processing (soybean crushing).
- Transportation of raw materials and finished products.
- Downstream emissions:
- Transportation and distribution to the consumer.
For food companies, their Scope 3 emissions often account for over 90% of their total carbon footprint, with a large portion of that coming directly from feed production.
Building a Low-Carbon Soy Supply Chain
Feed buyers can’t directly control emissions on farms, but they can influence and incentivize their suppliers to reduce their carbon footprint. Building a low-carbon soy supply chain involves a multi-pronged strategy that links buyers to producers.
1. Traceability and Data Transparency
The first step is to establish traceability to the farm level. Without a clear line of sight, it’s impossible to measure the embedded emissions in the soybean meal. Companies are using digital tools and platforms to track shipments and gather data on farming practices. This data can include:
- Farm location and size.
- Fertilizer and pesticide use.
- Adoption of sustainable practices like no-till or cover cropping.
This primary data is far more accurate than using generic emissions factors, allowing companies to create a verifiable baseline and report on their progress.
2. Sourcing from Low-Carbon Regions
The carbon footprint of soybeans varies significantly by region, primarily due to land-use change (LUC) emissions. Soybeans from areas with a history of deforestation, like some parts of Brazil, will have a much higher footprint than those from countries with a long history of agriculture on existing land, like the U.S. and some European regions.
- U.S. Soy: The U.S. has a demonstrably lower carbon footprint for its soy. The U.S. Soy Sustainability Assurance Protocol (SSAP) leverages a national-scale approach to verify sustainable production, providing buyers with a third-party-audited claim of low-carbon, deforestation-free soy.
- South American Soy: Buyers can still source from South America, but they must be diligent. They can work with suppliers who have robust, traceable systems to ensure their soy is not linked to recent deforestation.
3. Incentivizing Farmers to Adopt Climate-Smart Practices
Simply sourcing from low-carbon soy regions isn’t enough; feed buyers are directly engaging with farmers to drive further emissions reductions. This is often done through:
- Contractual Incentives: Buyers can offer financial incentives or premiums for soybeans grown using specific practices that reduce emissions.
- Supporting Regenerative Agriculture: Regenerative agriculture is a set of farming practices focused on improving soil health and sequestering carbon. Key practices include no-till farming, which avoids disturbing the soil and releasing carbon, and planting cover crops, which keep the soil covered year-round. Buyers can provide technical assistance, financial support, or long-term contracts to encourage farmers to adopt these practices.
4. The Role of Certifications and Standards
Certifications like the Round Table on Responsible Soy (RTRS) and International Sustainability & Carbon Certification (ISCC) provide third-party verification that a product meets specific sustainability criteria. For a feed buyer, using these certified products simplifies the reporting process and provides a credible claim to their own customers. The EU Deforestation Regulation (EUDR) is a prime example of how these certifications, or similar verifiable data, are becoming a requirement for market access.
The Business Case for Low-Carbon Soy
Reducing Scope 3 emissions isn’t just about corporate social responsibility; it’s a sound business strategy.
- Market Access: Major markets like the European Union are implementing regulations that require companies to report on and reduce their supply chain emissions. Without a clear low-carbon strategy, companies risk losing access to these profitable markets.
- Investor and Consumer Demand: Investors are increasingly using Environmental, Social, and Governance (ESG) criteria to guide their decisions, and consumers are demanding more transparent and sustainable products. A low-carbon supply chain enhances a company’s brand reputation and attracts a growing segment of environmentally conscious consumers.
- Supply Chain Resilience: A more efficient and sustainable supply chain, with reduced reliance on energy-intensive practices, is often more resilient to climate-related risks and price volatility.
In summary, for feed buyers, building a low-carbon soy supply chain is a strategic imperative. It’s about moving from a transactional relationship with suppliers to a collaborative partnership that drives sustainable change from the farm to the final product.
