27 Dec 2010

SEAP Quarterly Newsletter 2010-04

In this IssueIPNI SEAP to develop and deliver Nutrient Intelligence to its partners
IPNI Program Updates
IPNI SEAP to develop and deliver Nutrient Intelligence to its partners

SSNM maize review and planning workshop held in the Philippines

Improving dissemination approaches in Indonesia

Biannual coffee conference held in Bali

News From the Region


Wet climate boosts Indonesia's rice production


Vietnam to plant GM corn in 2011


Skepticism in Indonesia mounts on benefits of moratorium

In 2011, the IPNI Southeast Asia Program (SEAP) will be strengthening its role in providing strategic nutrient intelligence to its partners. Intelligence is amongst other factors involves the ability to reason, plan, solve problems, think abstractly, comprehend complex ideas, learn quickly, and to learn from experience. Nutrient Intelligence does the aforementioned to support management decisions that lead to improved crop yields or product quality through the concept of ecological intensification. By combining strategic information on field management with scientific understanding of plant nutrition and soils, SEAP aims to provide IPNI stakeholders with insights into optimal fertilizer use, its potential advantages, and obstacles to change. Nutrient Intelligence aims to provide the mechanisms, processes and information that guarantee the triple bottom line for ecological intensification through a cyclic diagnostic – monitoring – learning framework. SEAP will capitalize on current work on maize, rice, and oil palm to solve the complex problems that obstruct the adoption of site-specific nutrient management (SSNM).


APEC nations aim to boost productivity

Vietnam coffee sales slow despite high prices

Trial period forecast for Vietnam agriculture insurance plan

Journal articles of interest

Resource use efficiency and environmental performance of nine major biofuel crops, processed by first-generation conversion techniques

Opportunities for reducing greenhouse gas emissions in tropical peatlands

Reprinted article

Why sustainability needs big business, and why that’s not enough: the story of the Sustainable Food Lab.

News from the Region

Wet climate boosts Indonesia’s rice production
Indonesia’s Agriculture Minister Suswono has said the wet climate has helped boost Indonesia’s rice production expected to reach 65.98 million tons, up 2.46% from last year’s. The increased production of dried unhulled paddy was also thanks to productivity and harvesting expansions. Corn production also rose to 17.85 million tons, or up 1.22%. If around 90% of the domestic demands could be met, Indonesia would export rice, according to the minister.

However, Indonesia`s soybean production was recorded at 905,020 tons, or down 7.13%. "The soybean production went down because of climate factor. The year in 2010 we only had one season, namely rainy season," he said. The agriculture minister in cooperation with Perhutani (Indonesian Forestry Company) would expand the soybean fields to around 500,000 hectares. "We are still exporting soybean because the actual domestic demand is 2.1 million tons, while the production is only about 900,000." he said.

Meanwhile, the government recently announced its decision to raise rice imports by 300 thousand tons to 600 thousand tons this year. The rice would be imported from Thailand and Vietnam. The decision to import another 300 thousand tons of rice was aimed at securing year-end rice stocks. To stabilize domestic rice price the government must hold at least 1.5 million tons of rice in stocks at the end of this year.

Source: ANTARA News, November 15, 2010, http://www.antaranews.com
Vietnam to plant GM corn in 2011
Initial results of the experiments on genetically modified corn in the northern and southern regions were presented in a seminar in Ba Ria-Vung Tau, Vietnam. The Deputy Minister of Agriculture and Rural Development, Bui Ba Bong, said the project showed that genetically modified corn can adapt to the weather and land in these areas. It also showed that the corn is resistant to pests and could help Vietnam reduce its imports of maize for making animal fodder. Vietnam produces between 1.1 and 1.2 million tons of maize a year while it needs 1.5 million tons. The genetically modified corn will be planted on large scale from 2011, if it passes a final test, said Bong.

Vietnam also plans to grow genetically modified cotton and soybean by 2013-2014.

Source: Crop Biotech Update, October 15, 2010, http://www.isaaa.org
Skepticism in Indonesia mounts on benefits of moratorium
Industry stakeholders backed by renowned scientists have challenged the Indonesian government’s forest moratorium plan and demanded valid scientific assessments of its impact on the sustainability of the environment and economy. University of Lampung agricultural economist Bustanul Arifin says the moratorium, which fell under the government’s carbon emission reduction scheme (REDD), is based on variables that were not based on justifiable scientific findings. Among the variables, he said, was a 26% reduction of carbon emissions by the end of 2010 and a 41% reduction target. The government claimed the latter target would be possible only with assistance from donor countries or mechanisms under the UN Framework Convention on Climate Change (UNFCCC). The governments of Indonesia and Norway signed a letter of intent (LoI) on a climate deal in May requiring Indonesia, the world’s third-largest forest nation, to issue a moratorium on its primary forests and peatlands. In return, Indonesia would receive US$1 billion from Norway. The President is expected to issue a decree for the implementation of the climate deal.

The correlation between funds raised through the government’s emission reduction plans with the goal to tackle the forestry crisis was vague as there was not a definitive architecture to the so-called REDD scheme, Bustanul said. “It is also difficult to say that the REDD scheme takes into account the livelihoods of people living around the forest,” he said. Instead of implementing the moratorium, Bustanul argued, efforts to solve problems pertaining to conflicting land ownership and disputes over the definition of the types of forests would do more to control deforestation and land degradation.
Photo: IPNI SEAP, CWitt

Representing one of industries that will be heavily affected by the moratorium, the Indonesia Palm Oil Producers Association (Gapki) said the draft on the presidential decree on the moratorium did not specify the scope and the location of forests and peatlands prohibited from conversion. Gapki secretary-general Djoko Supriyono said that without proper implementation, the moratorium could contradict the people’s right for the alleviation of widespread poverty through the creation of employment. The moratorium would mean palm oil companies or farmers could not expand their businesses or recruit more workers. “Less jobs created means slower economic growth”, he said.

Currently, 2.8 million people depend on the palm oil industry: 1.2 million people work in palm oil plantations, while the remaining 1.6 million are farmers. Indonesia is currently the largest palm oil producer in the world. In 2009, total production reached 21 million tons. The country exported 14.5 million tons of palm oil last year.

Source: The Jakarta Post, September 3, 2010, http://www.thejakartapost.com
APEC nations aim to boost agricultural productivity
Asia Pacific nations agreed to boost the region's agricultural productivity through technology transfer and information sharing as climate change and a fall in arable land threaten future food supplies.

The 21-member countries of the Asia Pacific Economic Cooperation (APEC) also called for "responsible" agricultural investment as rising acquisition of farmland in developing countries by other nations to ensure their own food supplies is causing friction with local people.
"Land grabbing" is one of lingering effects of a spike in food prices in 2007 and 2008, when food importing countries with land and water constraints such as the Gulf States increased investments in farmland abroad.

According to the International Food Policy Research Institute, countries with large populations and food security concerns, such as China, South Korea and India, were seeking opportunities to produce food overseas.

The APEC nations adopted 62 action plans aimed at sharing technology and information mainly through websites and workshops. China and South Korea are among the APEC members, along with the United States, Russia, Canada, Australia and other Southeast Asian countries.

Source: Reuters, 17 October 2010, http://af.reuters.com
Vietnam coffee sales slow despite high prices
Vietnam's coffee exports are expected to fall this month by around a fifth from a year ago as stocks from the old crop are dwindling and rain has delayed the new crop, traders said.They said exporters were also reluctant to seal new deals for nearby shipment as rising prices on the London robusta futures market could bring them losses, and that might result in shipment delays and defaults in the first quarter of next year. When London prices are rising, exporters cannot guarantee they will be able to buy beans locally in future at the price they fix for exports. London January robusta coffee ended at $2,046 per ton on Monday after hitting a two-year peak of $2,058, supported by concern about rain in Vietnam, which is the world's biggest producer of robusta.

Vietnam could load between 60,000 tons and 70,000 tons of coffee, or 1.0 to 1.17 million bags, this month, down from the 81,600 tons shipped in the same month last year, traders said. A drop in shipments is expected as most of the stock carried forward from the 2009/2010 season was loaded last month, totaling an estimated 70,000 tons, while harvesting of the new crop has been delayed by rain. Rain is likely to persist in Vietnam's Central Highlands coffee belt throughout November and the rainy season is expected to end a month later than usual, a state forecaster said.

Source: Flex-News, 09 November, 2010, http://www.flex-news-food.com
Trial period forecast for Vietnam agriculture insurance plan
Vietnam's Ministry of Finance's draft plan concerning agricultural insurance for the 2011-13 period may be put on a trial basis and is winning applause from many officials, but insurance companies are having difficulties drawing up the plan. According to the draft plan, the Government will subsidize premiums for specified categories of poor farmers by up to 100%. To qualify for the subsidies, the farmers must be at risk from natural disasters and should be growing rice or raising buffaloes, cows, poultry, catfish, or tiger shrimps.
The proposal also details plans to provide subsidies, up to 60% of the premium, for farmers who are not categorized as impoverished. Organizations and firms involved in agriculture will receive a 50% subsidy. Priority will be given to farmers that live in areas that are frequently affected by storms, floods, drought, cold spells and frost, and foot-and-mouth disease.

Ministry of Finance's deputy head of the non-life insurance management division Do Anh Truong said agriculture insurance had not helped the agricultural sector. Few farmers purchased agricultural insurance, while few insurers offered services for the agricultural sector, Truong said. According to the Ministry of Finance, about 1% of farmers have agricultural insurance.

Experts said few insurance companies were interested in agricultural insurance because this was a risky business while farmers were not aware of the perks that come with agricultural insurance. Pham Van Be Nam, deputy chairman of the People's Committee of the southern province of Ben Tre's Thach Phu District, said that it would take a long time to persuade farmers to purchase the insurance because they are unaware of or do not understand how the system works. Farmers often looked for short-term profits rather than making long-term plans, he said.

Photo: http:// life.com

In the draft plan Agribank Insurance Company (ABIC), Bao Viet, Bao Minh and the National Re-insurance Corporation have been designated to participate in the trial program. ABIC deputy general director Nguyen Van Minh said the company had developed agricultural insurance packages and was raising capital to sell the services. However, the company was waiting for the Government's policies and Ministry of Finance's guiding circular to be published before it created a road map to sell its product. The draft plan was an important policy, but it was still hard for insurers to carry out because the plan did not specify mechanisms to protect insurance companies, Minh said. Agricultural insurance required a large amount of capital while insurance companies had limited financial capacities, so they needed to share their contracts with other re-insurers, he said.

Viet Nam Insurance Association general secretary Phung Dac Loc said agricultural production depended on natural conditions, and farmers were unable to calculate how much they might earn in a given year, so they are cautious of purchasing insurance policies. Insurance companies, due to the high risk, would demand high premiums that farmers could not afford.

Source: Vietnam News, October 05, 2010 http://vietnamnews.vnagency.com.vn
Journal articles of interestSSNM maize review and planning workshop held in the Philippines
Resource use efficiency and environmental performance of nine major biofuel crops, processed by first-generation conversion techniques
Sander C. de Vries, Gerrie W.J. van de Ven, Martin K. van Ittersum, Ken E. Giller (2010). Biomass and Bioenergy 34:588–601.

This paper compares the production–ecological sustainability of biofuel production from several major crops that are also commonly used for production of food or feed, based on current production practices in major production areas.

The set of nine sustainability indicators include resource use efficiency, soil quality, net energy production and greenhouse gas emissions, disregarding socioeconomic or biodiversity aspects and land use change.

Based on these nine production– ecological indicators and attributing equal importance to each indicator, biofuel produced from oil palm (South East Asia), sugarcane (Brazil) and sweet sorghum (China) appeared most sustainable. These crops make the most efficient use of land, water, nitrogen and energy resources, while pesticide applications are relatively low in relation to the net energy produced. Provided there is no land use change, greenhouse gas emissions of these three biofuels are substantially reduced compared with fossil fuels.

Oil palm was found most sustainable with respect to the maintenance of soil quality. Maize (USA) and wheat (Northwest Europe) as feedstock for ethanol perform poorly for nearly all indicators. Sugar beet (Northwest Europe), cassava (Thailand), rapeseed (Northwest Europe) and soybean (USA) take an intermediate position.
Dr. Mirasol Pampolino and Mrs. Julie Mae Pasuquin, IPNI SEAP Agronomists, participated in the 4th Philippine SSNM Maize Project Review and Planning Meeting held at the Grand Regal Hotel in Davao City, Philippines on 16-19 November 2010. They also acted as resource persons for the training on Nutrient Expert (NE) for Hybrid Maize software and the workshop on the development of Quick Guides (QG).

About 40 participants, consisting of researchers, research managers, extension agents, and regional government officers representing 16 regions in the country were trained on the NE software. Also present were technical staff from Atlas Fertilizer Corp.

As output of the training-workshop, each region was able to develop at least one QG for a municipality in their region. Quick Guides are one-page summaries designed to capture the most important aspects affecting fertilizer recommendations for maize in a given geographical area (e.g., soil type, season, residue management, yield target). These QGs will be used in farmer participatory evaluation (FPE) and/or field demonstration activities in the coming 2010-2011 dry season.

Results from the on-farm trials during 2008-2010 showed that with optimal rates of fertilizer N, P, and K, SSNM has a yield advantage over the farmers’ practice (FFP) of at least 1 t/ha. Across the four seasons and 16 regions, average yield was 8.1 t/ha with SSNM and 6.8 t/ha with FFP. High yield improvements over farmers’ yields were also attained with improved strategies for Bio-N and organic matter application in combination with SSNM. These results are clear indications that yield and profit of maize farming in the Philippines can be increased through improved crop and nutrient management.

The SSNM technical working group expressed their appreciation for IPNI’s technical support. In the coming dry season, the Government’s Regional Corn Program has committed to support the FPE/field demonstration of SSNM by providing additional funds in regions where funds from Department of Agriculture’s – Bureau of Agricultural Research (DA-BAR) are insufficient. Also, DA-BAR is looking forward to do a national launching of SSNM during the 1st half of 2011 to showcase the SSNM products (Nutrient Expert, Quick Guides).

Another workshop will be conducted in April 2011 to review the results of the 2010-2011 dry season SSNM demo and/or FPE.
Improving dissemination approaches in Indonesia
Opportunities for reducing greenhouse gas emissions in tropical peatlands
D. Murdiyarso, K. Hergoualc’h, and L. V. Verchot (2010) PNAS. Vol. 107, no. 46, Pages 19655 – 19660. www.pnas.org/cgi/doi/10.1073/pnas.0911966107

The upcoming global mechanism for reducing emissions from deforestation and forest degradation in developing countries should include and prioritize tropical peatlands. Forested tropical peatlands in Southeast Asia are rapidly being converted into production systems by introducing perennial crops for lucrative agribusiness, such as oil palm and pulpwood plantations, causing large greenhouse gas (GHG) emissions.

The Intergovernmental Panel on Climate Change Guidelines for GHG Inventory on Agriculture, Forestry, and Other Land Uses provide an adequate framework for emissions inventories in these ecosystems; however, specific emission factors are needed for more accurate and cost-effective monitoring.

The emissions are governed by complex biophysical processes, such as peat decomposition and compaction, nutrient availability, soil water content, and water table level, all of which are affected by management practices. The estimated total carbon loss from converting peat swamp forests into oil palm is 59.4 ± 10.2 Mg of CO2 per hectare per year during the first 25 y after land-use cover change, of which 61.6% arise from the peat. Of the total amount (1,486 ± 183 Mg of CO2 per hectare over 25 y), 25% are released immediately from land-clearing fire. In order to maintain high palm oil production, nitrogen inputs through fertilizer are needed and the magnitude of the resulting increased N2O emissions compared to CO2 losses remains unclear.
Dr. Mirasol Pampolino, IPNI SEA Agronomist, and Dr. Thomas Oberthür, IPNI SEA Director, contributed as resource persons at a two day meeting organized by the Indonesian Centre for Agricultural Technology Assessment and Development (ICATAD) under the theme: In-search for an Innovative Dissemination Approach for Agriculture Technology.

The meeting that took place in Solo, Indonesia on 27-28 October 2010 brought together about 25 key agricultural decision makers for technology development, and technology assessment and extension in Indonesia, including the directors of ICATAD Drs. Muhrizal Sarwani and Erizal Jamal, as well as the director of ICFORD Dr. Suyamto. Dr. Pampolino presented results of the SSNM work from the last 4 years while Dr. Oberthür presented IPNI SEA opportunities for engagement in a dissemination process as well as decision support tools. Dr Sunendar (IPNI SEA Indonesia liaison officer) helped in the preparation of the workshop and served as a resource person during the discussions. Dr Zulkifli Zaini provided first results from the participatory assessments of SSNM (i.e. prototype SSNM recommendation for a new site developed using NE maize software) in Bone, South Sulawesi. They demonstrated that NE maize (PuJS in Indonesian) recommendations in all occasions resulted in yields higher than those obtained using farmer’s fertilizer practice (FFP) and were even slightly higher than the targeted attainable yield estimated by NE maize.

Major outputs of the meeting include:
  • the identification of key characteristics for an agricultural dissemination model,
  • outlining of the elements of a “learning platform for SSNM dissemination”, and
  • the decision to implement this new dissemination approach using SSNM as a model technology.

The Indonesian Center for Agricultural Technology Assessment and Development (ICATAD) performs program formulation, evaluation, collaboration, making efficient use of agricultural technology assessment and development, assessing and developing standard methods, excellent technology packages, and regional and national agricultural technology models. ICATAD coordinates the activities of Assessment Institutes for Agricultural Technology (AIATs) in 31 provinces. The Indonesian Center for Food Crops Research and Development (ICFORD) is responsible for research and development of food crops (rice, maize and other cereals, legumes such as soy bean, and peanuts). Its work covers plant genetics (management of germplasm and breeding) and resource management to improve production systems, harvest and post-harvest handling.
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The biannual coffee science conference (23rd ASIC Conference) was held in Nusa Dua, Bali, Indonesia. It is the most important coffee science event for the industry. Over the last couple of events a clear trend has been emerging of much stronger representation of (a) agronomic systems management aspects (particularly a number of posters highlighted the role of plant nutrition within sustainable coffee systems), (b) all aspects of specialty coffee and (c) issues related to cooperation between value chain members.

This year’s event had two main themes including “coffee science and health” and “coffee science and sustainability and climate change”. Dr. Thomas Oberthür, IPNI SEA Director, presented the paper by P. Läderach, T. Oberthür, O. Ovalle and A. Eitzinger on “Impacts of global climate change in Mesoamerican coffee systems” within the first of two sub sessions of the Coffee Agronomy – Sustainability and Agroecology block. The paper was very well received and demonstrated the leadership role that CIAT currently has in this area. It was one of very few contributions to present quantitative assessments and alternative pathways (a) to understand the impacts of and threats from climate variability in coffee systems and (b) to realize the emerging opportunities from climate variability. The paper generated lively interest by industry companies and other research organizations.

San Jose, Costa Rica will be the next host for the 2012 event.
Why sustainability needs big business, and why that’s not enough: the story of the Sustainable Food Lab
Hal Hamilton
Reprinted from the Sustainable Food Laboratory Newsletter October 2010
This article was a result of a talk I was asked to give to the annual gathering of sustainable agriculture grant-makers. My goal for the talk was to describe partnerships between nonprofits and businesses, their promise and their challenges. I spoke from my experience in the Sustainable Food Lab, and I knew I would face a skeptical audience.

I was right. Many participants were skeptical. The most common attitude that sustainable agriculture funders and activists express is something like, “Corporate agribusiness is damaging the earth and exploiting people, and big corporations’ engagement in sustainability is primarily to green-wash their reputations. We need a whole new paradigm: small local production.”

Since the Food Lab gins up sustainability projects with large businesses, we are always ready with examples of reduced pesticides on hundreds of thousands of acres or improved livelihood for tens of thousands of small farmers. Big companies can have huge positive impacts if they do the right things. The core criticism of business, however, is that short term numbers usually trump sustainability and fairness. This criticism is frequently accurate, but leads me to a question that guides our work with businesses and their nonprofit partners: “What would it take for sustainability and fairness to have equal standing as goals with stock value and profits?

Businesses are easily consumed by the need to chase quarterly numbers and cut costs. Over the long haul, however, successful businesses are often those that do long-term accounting of a range of costs and benefits, including costs and benefits to the people and places touched by their business networks. One senior executive of Unilever recently told me that he considered genuine achievements in sustainability and social responsibility as essential to their “license to grow,” particularly in emerging markets.

I don’t mean to imply that business sustainability strategies are sufficient to the pace and scale of change needed. They aren’t. For example, climate change and chronic poverty are worsening faster than business practices are improving. Nevertheless, new commitments and implementation of sustainability goals by business are heartening, as are new forms of collaboration between businesses and non-commercial sectors.

This moment in history is full of paradox. It’s not easy to hold the hope and the challenges in our minds at the same time. Sustainability work is mushrooming, and we are hitting barriers. Unilever, for example, invested considerable effort in the development of sustainability standards for palm oil, one of the most ubiquitous food ingredients in the world. Those standards are being adopted by a critical mass of the industry, yet deforestation in Indonesia, related to the growth of palm oil plantations, is still spreading like a cancer across critical forests. As a result of the unsolved challenges to the forests, and indirectly to the earth’s capacity to sequester carbon, Unilever is faced with protesters pushing them to do more.

One of the challenges we’re now facing is that governments have an important role to play, even though governments are frequently cumbersome. Unilever and some of its competitors have made new commitments to palm oil standards, but only government can make rules that affect everyone.

What do we all want?

Virtually everyone in business, nonprofit organizations, and government wants agriculture and food systems to be environmentally sustainable, just, and fair, while producing healthy products and enabling community well-being. Despite agreement on this goal, however, it is difficult to come to consensus on methods. One of the projects supported by members of the Food Lab is the Stewardship Index for Specialty Crops, which is governed by both industry and activist groups. All the groups agree that toxicity and labor are important issues for produce operations, but when we discuss specific ways to address pesticide toxicity and labor rights, the conversation becomes contentious. In another instance, when the Sustainable Food Lab co-hosted a national conference with the Keystone Center’s Field to Market Alliance, acrimony arose between organic and conventional leaders. Each camp takes the stance, “My solution is the solution.

Difficult and unresolved as these disagreements are, I believe that we nevertheless can make progress in the right general direction. I don’t think that everyone needs to agree on the methods. The language we choose to use in these conversations is crucial. At a conference that the Sustainable Food Lab organized, titled “21st Century Agriculture Revolution,” we discovered that the word “revolution” was threatening to some people who shared our goals but found this emotional approach too aggressive. My experience is that if we learn to use inclusive language, and if we hold differences in a container of respect and encourage practical actions among unlikely allies, people end up agreeing more than they thought they would.

After a workshop of the Sustainable Food Lab’s founding leaders, I took the following comment from a Brazilian industry executive as high praise: “You have been able to put dogs and cats in a closed bag. Everybody got out alive and, more amazing, respecting each other’s different points of view and agreeing that we could achieve something together.

The three common nonprofit approaches

Projects of sustainable agriculture nonprofits can be grouped in the following three categories: (a) build alternative models; (b) tweak the mainstream system; or (c) attack the mainstream system. My sense is that each of these approaches is sometimes useful, but none of them is proving adequate. One of our colleagues, Adam Kahane, likes to say that, “Change from the top down doesn’t work, and change from the bottom up doesn’t add up.” Adam means that systemic change that improves life for people and communities without power will always need leadership from those same people and communities; similarly, systemic change in the way markets work will always need leadership by those who know markets from the inside of business. Adam’s inclusive formulation has the advantage of including those who know most about how production and commerce function, but most NGOs choose a bottom-up outsider stance.

Many nonprofits focus on local food chains and see themselves as creating models of farming and marketing that are substitutes for the large industrial system. These “alternative models,” from community supported agriculture farms to new urban markets, are frequently inspiring. Local food is my personal choice for freshness and flavor. I also like to think that my food purchases support local economies. These approaches, however, are not easily scalable, and global challenges are so acute that I believe they must be addressed at scale, even as many groups work on local projects.

To achieve a scale of impact greater than small farm and community projects, some large NGOs now pursue a second approach, supporting the incremental sustainability improvements of big business. When large companies agree to environmental or social improvements, they can help NGOs like WWF or Oxfam fulfill their public mission. For example, when Sysco established an IPM program for frozen and canned produce, they eliminated the use of 300,000 pounds of active ingredients of pesticides on more than 500,000 acres in just the first year of the program. However, Sysco executives are the first to add that these improvements don’t yet add up to “sustainability”.

The reason that incremental improvements don’t cascade through the industry at a sufficient rate is that the very structure of our economy resists systemic change. All publicly traded companies must increase their quarterly numbers in stock value. Large food-service companies are dependent upon volume discounts, and retail chains frequently charge stocking fees. These structures reward mass production and ensure that companies chase short-term goals. Sustainability is about creating long-term value, but many structured incentives reward short-term measures that might even sacrifice long-term value. Global commodity markets reward mass efficiencies and penalize any initiatives that increase costs.

Activists often respond to this structural resistance to change within the economy with the third common approach: organizing campaigns that criticize mainstream businesses—Greenpeace campaigning against purchasers of palm oil, for example. These anti-corporate campaigns have mixed effects. On the one hand, they can create an environment in which businesses face increased reputational risk and need to demonstrate responsibility. Such an environment can stimulate positive innovation. On the other hand, many campaigns attack the very brands that are leaders in sustainability and thereby provide signals to others that the risk of being criticized for not doing better is so high that it’s safer to do nothing. Campaigns also make companies very skittish about being transparent.

What would it really take?

My core answer to the question “What would it really take?” is that collaboration across boundaries is essential because no single sector has enough of both insight and influence. Farmers and communities can act only within limited boundaries. NGOs have the public good as their purpose, but NGOs have their hands on only a few levers. Businesses know how to deliver the most value for the least cost. By themselves, however, without the persistent presence of external stakeholders, businesses are governed by the “invisible hand” of markets and will exploit resources and externalize costs. Government has to set the rules, but government moves at the slowest pace of any of the sectors, and government can be influenced by special interests to betray the common good.

A web of active partnerships is emerging, primarily among businesses and NGOs. I will describe some of the partnerships developed in the Sustainable Food Lab because they make me more hopeful about systemic change than I have been in more than 40 years of social change activity. I’m hopeful because sustainability and social justice are becoming mainstream.

Sustainable Food Lab

Photo: SFL
The Sustainable Food Lab is only six years old but already a group of amazing leaders from different continents and different parts of the system have inspired one another to try out innovative projects within supply chains. They know they have a long row to hoe, but they are learning along the way. Each of these projects marries profit with sustainability. Sometimes this marriage is an uneasy one, but, in the end, sustainability is shifting from niche to mainstream more rapidly than I would have predicted.

The following description of the Lab came from Larry Pulliam, Executive Vice-President of Sysco. Larry makes billions of dollars in purchasing decisions every year:

It’s pretty unusual that fierce competitors like Sysco and US Foodservice can come together and work for the higher good. That’s what it’s all about. The essence, the power, of the Sustainable Food Lab is that we can do a hundred fold, a thousand fold, more together than we can do by ourselves. What we’re doing is the right thing to do, the good thing to do—for the world. It’s also good for our businesses. There’s a competitive advantage for Sysco to be involved, but we can’t fully realize that competitive advantage without working together with others in this group to mainstream sustainability.

One of our early conversations among founders of the Sustainable Food Lab involved Jan Kees Vis from Unilever, one of the three largest food manufacturers in the world, and Oran Hesterman from the Kellogg Foundation, at that time the largest funder of sustainable agriculture projects in the United States. Jan Kees and Oran described their ongoing investments in sustainable agriculture projects and their desire to influence the mainstream, but each also expressed a sense that neither the Kellogg Foundation nor Unilever was powerful enough to do this alone. Partnerships were needed.

Over the succeeding year and a half, Adam Kahane, Don Seville, and I interviewed dozens of food system leaders in the United States, Europe, and Latin America. From among these interviewees, individuals were invited to join the Food Lab. The intention was to bring together entrepreneurial leaders seeking more rapid and far-reaching change in the direction of sustainability than their current efforts had achieved. By June 2004, a group of thirty-two pioneering leaders from different sectors—business, government, social and environmental NGOs—came together in the Netherlands. Now, many more have joined, and about eighty organizations are involved.

Each person in the original core group joined with an intention to address problems that were too complex for their own organizations or sectors to tackle alone. Businesses needed NGO expertise on watersheds or poverty, for example, and NGOs needed business influence on market standards. One of the founders put it this way, “We are frustrated that the changes we see are too slow. They are not delivering the kind of improvements that secure the resource base for the industry for the next twenty years. How can we generate faster change? We are intrigued about the possibility that the Food Lab can get such a diverse group working together creating something at the ground level and delivering change at the top of the system.”

Both corporations and NGOs are evolving. Unilever, for example, has made a commitment to source all its renewable ingredients from sustainable production within ten years, and they recently began certifying 12 percent of the world’s black tea, under the Lipton brand, with Rainforest Alliance. Oxfam has added a corporate engagement program to its portfolio of campaigning programs. In many cases, Oxfam sees working with corporations as an effective way to meet its social justice mission. In one of our projects, Oxfam GB partners with Sysco in supporting about three thousand small vegetable farmers in the highlands of Guatemala to sell into a frozen food chain, increasing their capacity to also sell into local markets.

After an earlier project the Food Lab coordinated with Costco became an inspiration to senior executives, Costco established new sustainability guidelines inside procurement for seafood, dairy products, fruits, and many other products. Costco partnered with other organizations like WWF or the Gates Foundation as needed. From another project, socially responsible perennial flowers from Kenya have been successful enough on Asda grocery shelves in the UK to stimulate a new buying program for small farm products from all over Africa. In the United States, CH Robinson, a $7 billion distributor, has experimented with providing logistics, warehousing, and technical support to local farmers in local supply chains to retail stores around the country.

The Sustainable Food Lab’s role is to germinate and support these projects and then share learning to accelerate replication. Sometimes the projects are with specific companies and NGO partners, and sometimes the projects involve consortia of organizations. In one of our new initiatives, we have 19 company sponsors of a project to reduce the carbon footprint of agriculture around the world. We’re also doing a project with the Ford Foundation and the International Fund for Agricultural Development, along with our business and NGO partners, to design ways that global supply chains can best benefit small farmers and the poor.

The next phase

Even though my colleagues and I see enormous potential for business NGO partnerships within major value chains, and even though we can measure impacts on hundreds of thousands of acres and for tens of thousands of small farmers, we are running into barriers. Companies only make changes that are cost neutral or that gain consumer support. They cannot add costs, in isolation, that make them less competitive. They would not survive. Some of the costs of sustainability require co-investment by other sectors.

The limits to change within individual value chains or competitive markets will frame the next frontier of large-scale change. Some of the most experienced leaders are describing these limits to one another, articulating the fact that they see the limitations of acting alone, particularly where they run into costs that can’t be borne by the supply chain in the current competitive structure, or where the competitive structure itself includes perverse incentives. These frustrations lead either to backsliding or to a search for new ideas.

The most important collaborative initiatives will marshal the best competencies of business, NGOs, and the public sector. The fertile ground of systemic change is in this partnership space, trying out new organizational forms that enable practical management of the environmental commons as well as coordinated investments in opportunities for the poor. We need to execute as well as dream.

Reprinted from: http://www.sustainablefoodlab.org/news-october-10
Last accessed: 07 December 2010
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