The Economic Benefits of Sustainable Farming

Sustainable agriculture promises to help feed a growing population and mitigate the effects of climate change. Using methods such as increased crop rotation, no-till and winter cover crops, farmers can increase yields and profits.

It’s not easy for Roric Paulman to manage the scarce water resources that support the 10,000 acres of chickpeas, wheat, corn and yellow popcorn that he farms seven miles south of Sutherland in western Nebraska. For nearly 20 years, Paulman has been using strip-till or no-till methods and more frequent than usual crop rotation to manage pests, improve soil health and increase yields.

Paulman is part of a growing global movement in sustainable agriculture that uses land and water resources responsibly, reduces pest control inputs and maintains the quality of the soil. Sustainable agriculture—an outgrowth of the decades-old stewardship movement—is not only good for the environment, it promises to increase yields for an increasingly hungry planet. It also can boost profits for individual farmers.

Says Paulman, 60, “We’re living in a world of past sins; but you have to be profitable at the end of the day.” Paulman, who has been working his family farm for 33 years, estimates that as a result of sustainable practices, some of his yields, over a three- to five-year period, have increased more than 10 percent.

What is sustainable farming, why is there so much interest in it, and what does the future hold?

Sustainably profitable

The U.S. Department of Agriculture defines sustainable farming as a series of interconnected land management techniques that sustain “farmers, resources and communities by promoting farming practices and methods that are profitable, environmentally sound and good for communities.”

Some of the techniques used by Paulman and other sustainable producers include minimizing or eliminating tilling, encouraging soil health with more frequent crop rotation and the use of winter cover crops, and integrating croplands with livestock grazing. Sustainable agriculture also encompasses what happens to food after it’s harvested, fished or slaughtered. That’s the connection between sustainable farming and the growth in urban farmers’ markets that supports the farm-to-table movement—with the added benefit of minimizing the amount of energy used to transport food to the consumer.

The focus on sustainable agriculture isn’t just driven by environment concerns, but also by the growing, gnawing need to meet the unrelenting demand for increased yields. According to the United Nations, there are 7.3 billion people now living on the planet (up from 1.8 billion in 1915.) The UN estimates that worldwide population levels will grow to 9.7 billion in 2050. This 33 percent increase, along with rising incomes in developing countries that fuel demand, point to food requirements that will nearly double by mid-century.

There are two other challenges, of course: the conversion of some cropland for biofuels rather than food, and the overall effect on worldwide arable land caused by erosion, urbanization, and climate change. And while global warming may benefit northern latitude crop-growing locations, such as Canada, China and Russia, it causes stress in other well-developed agricultural production regions of the globe, such as equatorial Brazil, the Midwest of the U.S. and eastern Australia. Experts warn of overall reductions in these regions in the production of key crops such as wheat, rice and corn.

The sustainable solution

Together, these factors will require farmers to increase crop production, both by increasing the amount of agricultural land and by enhancing yields on existing lands. Otherwise, food security will suffer. That’s where sustainable agriculture practices come in.

There’s no one magic approach to sustainable agriculture. It’s an ever-changing collection of natural and human inputs. Take one of many strategies: increasing soil health by boosting the volume of microbes in the ground through the use of cover crops. Also called green manure, cover crops help suppress weeds, control pests and diseases, and build productive soil. “We need a living root in the ground at all times,” notes Sarah Carlson, Strategic Initiatives Director at Practical Farmers of Iowa, in Ames.

The use of cover crops is just one of many inputs to sustainable agriculture, and farmers may choose to employ some sustainable practices but not others. This diversity of approach makes it hard to quantify overall financial and productivity gains. Nonetheless, government, academic and industry-funded research point to a clear set of benefits, including greater soil health, better water management and higher yields.

For instance, SARE, the acronym for the U.S. Department of Agriculture’s Sustainable Agriculture Research & Education effort, conducts an annual audit of U.S. farmers, most of whom use cover crops such as cereal rye, oats, and winter wheat. In its 2017 survey of 2,012 U.S. farmers, producers reported, on average, yield increases of 3.8% for soybeans, 2.8% for wheat and 1.3% for corn.

“We think we’re making inroads into encouraging sustainable practices, says Kim S. Kroll, an associate director at SARE. “But we’d like to make them faster.” Over the past 25-plus years, SARE has awarded several thousand grants of between $25,000 and $350,000 to farmers so that they can experiment with sustainable practices, according to Kroll.

A combined effort

The attention now being paid to sustainable agriculture is not confined to farmers and the government. Increasingly, food retailers, big agribusiness outfits, conservation groups and universities are working together to develop, fund and encourage sustainable agriculture practices.

The venture capital community, too, has gotten involved, ploughing a record $1.5 billion into all parts of the agriculture supply chain in 2017.  Investments are giving rise to instrumentation for monitoring microclimates, robotics and precision machinery for managing inputs, drones for survey fields, and big data analytics for maximizing yield, quality, and sustainability.

The stakes are high, especially given climate and population changes. But the rewards of sustainable agriculture provide substantial financial incentives to producers and others in the food production supply chain. Indeed, in 2016, the Business and Sustainable Development Commission, an international non-profit, released a report that outlined new business opportunities in sustainable food production and distribution totaling an annual $2.3 trillion—and 80 million new jobs—by 2030.

That’s good news for farmers like Nebraska’s Roric Paulman. “It’s a long cycle,” he says. “But it’s the right thing to do.”