Emma Piercy, head of climate change & energy policy at the Food and Drink Federation, makes the case for regenerative agriculture.
Britain’s food manufacturers depend on the health of the natural environment, yet the UK’s natural capital has been declining for decades. Poor soil quality alone is already costing the sector £246 million each year in lower yields and higher fertiliser costs. And these costs are being baked into the prices consumers are seeing on the supermarket shelves. As extreme weather becomes more frequent, this decline threatens not only domestic production but the long‑term ability of global agriculture to keep pace with rising demand.
However, while the food system’s dependency on the environment is clear, so too is its contribution to the challenges. The food industry accounts for a quarter of global greenhouse gases (two-thirds of this coming from ingredients), 80% of global biodiversity loss and 70% of freshwater withdrawals.
These challenges have put a spotlight on Regenerative Agriculture, also known as Regen Ag. Put simply, Regen Ag is an approach to farming that focuses on rebuilding soil health, improving biodiversity and making farms more resilient to climate change. It includes practices such as reduced tillage, cover cropping and better nutrient management, all aimed at restoring the natural systems that underpin food production.
For food and drink manufacturers, regenerative agriculture is no longer a niche idea. It’s becoming an essential tool for managing risk, securing future supplies and contributing to climate and nature targets. As the shift towards more sustainable farming gathers pace, FDF members, aligned through our Ambition 2030 programme, are increasingly exploring how regenerative approaches can be supported and scaled across their supply chains.
The next agricultural revolution
The changes required to integrate soil health, environmental sustainability and climate adaption into conventional farming represent a significant shift for the sector. The fifth agricultural revolution is now underway.
And there’s big wins to be made. The adoption of regenerative practices will reduce fertiliser requirements, improve soil health and build resiliency to drought and flooding. However, with new training and equipment needed on farm, and lower yields for the first three to five years of the transition, farmers will need financial support to cover the significant capital outlays and bridge the yield gap.
Manufacturers, retailers, wholesalers and hospitality, supported by Government and other value chain partners, such as banking and insurance, must all play key roles in supporting farmers in this transition to achieve the change at scale that the entire food system needs.
Why manufacturers are responding
Responding to this challenge, several major UK food and drink manufacturers, including Nestlé, PepsiCo, McCain, Danone and General Mills, have all committed to scaling Regen Ag practices within their sourcing.
When speaking with our members, it’s clear that supporting greater supply chain resiliency to ensure availability of future supplies in the quantity and quality needed is the primary driver for these investments. Investing in Regen Ag will help reduce future inflationary pressures, and manage risk exposure – whether by lowering costs, improving availability or building brand reputation. It will also help support companies to meet their carbon reduction targets, since Regen Ag methods lower the use of synthetic fertilisers and improved soil quality enhances the soil’s capacity to store CO2.
Improving farmer livelihoods – farms must be profitable to secure future generations that want to work in the profession – and keeping our population fed at an affordable price are also key factors driving food manufacturers’ investments.
Barriers to scaling regenerative agriculture
There’s a clear argument for Regen Ag investment, one that I’m sure consumers would support. But there’s a gap between what customers say they value and what they’re prepared to pay. As cost of living continues to be a challenge, it’s unlikely that consumers will pay a premium for Regen Ag products.
Beyond this, food and drink manufacturers are grappling with some hefty challenges – such as choosing appropriate regenerative agriculture practices and providing long-term commercial support to farmers, in particular during the three-to-five-year transition period. Volatile markets and supply chain pressure to keep prices low further increase the challenges of balancing commercial priorities with longer‑term sustainability commitments.
Yet we do have some great examples of manufacturers already making substantial progress. For example, the Nestlé Milk Plan is a sustainability initiative, primarily in partnership with First Milk, designed to transition dairy farming toward regenerative practices. Last year it celebrated its 21st birthday. McCains also works with farmers close to their production sites and has an ambition to have 100% regenerative agriculture practices implemented on land used to grow McCain potatoes by 2030.
A lack of consistent industry approaches to data collection and carbon accounting, however, complicates investment decisions and marketing claims. While challenges around defining regenerative agriculture are widely recognised, practical solutions remain limited.
Frameworks such as launched by the Sustainable Agriculture Initiative and emerging collective action projects offer promising routes forward. These approaches can reduce risk, lower resource requirements and help close skills gaps by enabling companies to learn together rather than act in isolation.
The importance of skills, collaboration and clear communication
So, while the benefits are clear, measuring a tangible impact and return on investment can be a challenge. A common barrier facing food manufacturers is how to clearly land the business case to get sign-off internally.
Central to securing this internal support for investment, and ensuring successful implementation, is building the skills and knowledge of all stakeholders. It’s a complex topic but understanding the long-term risks businesses face and the options available to them to mitigate them, is core to establishing Regen Ag as an enduring long-term investment.
We all know that this is coming at a time when demands on the limited available capital are high. And this is coming alongside pressure to keep costs low, given weak consumer confidence here in the UK, alongside challenges caused by the ongoing conflict in the Middle East, which will be felt well into 2026. With investment in Regen Ag competing against every other part of the business, strong storytelling and a consistent narrative will make all the difference in getting leadership buy-in and long-term investment success.
This strong communication needs to extend beyond company boundaries and right across the supply chain, increasing trust and transparency, to ensure a wide-scale transition to Regen Ag. By farmers, manufacturers and retailers all cooperating and learning from each other, we can move from trials to scaling investments, while lowering implementation costs. The key is to build strong relationships where solutions are created together, integrating farmers into the decision making to ensure the right practices are implemented at the right time with the right support.
How to start?
But how do you get your company to spend time and resource on this area? Our recommendation to members is to check out the Green Finance Institute, which has made available a range of resources to present a business case to boards on why and how businesses can get started.
These are based on the framework from the Taskforce on Nature-related Financial Disclosures (TNFD), which FDF also used to structure its Nature Handbook for manufacturers, which is part of the Ambition 2030 sustainability programme. The handbook covers the drivers for action – the ‘why’ on getting involved; the options businesses can take – the ‘what’ of getting involved; and the governance, reporting and disclosing – the ‘how’ monitoring and measuring progress.
The first action to take, though, is an assessment of your suppliers, whether these be directly with farmers, through intermediaries or with globally traded commodities. The TNFD ‘LEAP’ process also offers a step-by-step approach companies can take and has four main components:
- Locate your interface with nature.
- Evaluate your reliance and impacts on nature
- Assess your nature-related risks (exposure) and opportunities
- Prepare to respond to nature-related risks and opportunities – i.e. your mitigation strategy
In the last stage, this commences with setting a procurement strategy. By working with your suppliers, you can collaborate on shared environmental ambitions, agree contracts that prioritise long term sustainable returns and share knowledge. Manufacturers can therefore work to support farmers in their supply chain both directly and via intermediaries.
Companies can support Regen Ag programmes through direct relationships with farmers in their supply chain or through collective action projects. These projects bring together a range of stakeholder groups to combine resources and facilitate investment into farms at a landscape level, reducing implementation costs and other barriers to entry.
Overall, such collaborative efforts must now be replicated to learn from trials to date, pool resources and address the wider challenges encountered. Only by doing this can we match the pace of environmental change with the level of ambition required. The fifth agricultural revolution is already underway; the question now is whether we are prepared to fund it at the scale needed to secure the future of Britain’s food system.
The Food and Drink Federation is a membership organisation representing food and drink manufacturers in the UK by contributing to policy and legislation and championing members’ views on key policy areas.
Emma Piercy is head of climate change & energy policy FDF. Emma joined the Food and Drink Federation in October 2019 and has led on developing and implementing FDF’s environmental sustainability strategy ‘Ambition 2030’. Working across the farm-to-fork supply chain, her focus is on tackling the shared decarbonisation challenges and to align on industry led solutions including driving investment into nature restoration.
