Welcome. This is Look Up Ventures’ second long-read. It continues the series of posts on the great opportunity of Climate Resilience. We invite you to sit back and read - and please share your thoughts with us via the LinkedIn-post or reach out to us if you’d like to discuss further.
TL;DR
**Starkly intensifying climate-induced stressors to our natural systems, a growing population, and an established agricultural industry fueling a vicious, exacerbating cycle of climate change and productivity loss through its short-term focus on crop yields. These are some of the main challenges that the agricultural industry is faced with, and continuing business as usual does not hold the solutions to ensuring a resilient agricultural system.
To address the challenges, investors and start-ups should widen their perspective to solve for resilient, healthy ecosystem health across three innovation areas; biological resilience solutions that plug into existing supply chains, alternative farming methods that free up land and produce food in new, resilient supply chains, and enabling innovations that can fuel the transition towards a resilient agricultural system.**
Productive agriculture is one of the most important building blocks for ensuring a livable and stable existence for all human beings. This foundation is challenged by a rapidly growing population and accelerating consequences from climate change. As the world reaches nearly 9.7 billion people by 2050, the world must achieve a staggering 70% increase in food production to ensure global food security. At the same time, climate change leads to crop failures and disruptions to the global supply chain, posing significant economic and social risks to society:
From an economic perspective, changes in temperature and precipitation patterns, along with the increased frequency of extreme weather events, significantly impact agricultural output. According to a study by [Cornell University](https://news.cornell.edu/stories/2021/04/climate-change-has-cost-7-years-ag-productivity-growth#:~:text=Despite important agricultural advancements to,productivity increases since the 1960s.), global farming productivity in 2020 was 21% lower than it could have been without climate change, equivalent to losing about 7 years of agricultural productivity growth. Adding to this, McKinsey found that the likelihood of a +15% global yield failure is projected to double by 2030 and quadruple by 2050. In essence…
“… Multiple-breadbasket failure - simultaneous shocks to grain production in a sufficient number of breadbaskets to affect global production - becomes increasingly likely in the decades ahead, driven by an increase in both the likelihood and the severity of climate events.” *McKinsey*
From a social perspective, the failure of entire breadbasket regions poses a direct threat to the availability and affordability of food on a global scale, potentially leading to food shortages, increased prices, higher poverty rates worldwide, and ultimately migration: In 2023, food prices outpaced inflation by 2 percentage points and the International Food Policy Research Institute found that recent global price shocks have led to a rise in national poverty headcount rates by as much as 7.7 percentage points and undernourishment by up to 4.4 percentage points.
On top of this, the nutritional value of agricultural products is challenged in our current mode of production: wheat protein content has declined by almost 1/4 alongside significant reductions in the availability of manganese, iron, zinc, and magnesium. Looking ahead, double-digit percentage decreases in nutritional value over the next decades are projected across central food sources like potatoes, rice, wheat, and barley, ultimately leading to furthering protein deficiency for hundreds of millions of people.
While the consequences of climate change are already here, tackling the severe challenges related to productivity and food security faces potential obstacles due to the industry’s commoditized and, to some extent, oligopolistic nature. Consolidation in markets such as seed and agrochemicals have seen entire markets being split between few major global players, allowing them to set the standard for conventional agriculture. Frankly, this standard has become to optimize for short-term yield gains, for example, through monocropping, tilling, and the use of agrochemical products such as synthetic fertilizers and pesticides. Ironically, although the innovation within the field has enabled an incredible historic productivity boost, its methods only exacerbate the underlying issues of securing agricultural resilience in the long run.
Applying agrochemicals and tilling monocrop soils to achieve “immediate” productivity boosts leads to increased CO2. This increase comes from the lifecycle of producing, transporting, and applying agrochemicals, as well as from soil depletion. Conventional practices reduce the soil's capacity to hold water, CO2, and nutrients, making farmland more susceptible to flooding. The decreased carbon sink potential leads to a higher concentration of CO2 in the atmosphere. Monocropping and stripping the soil from microorganisms and a biodiverse environment increases the vulnerability to pests and diseases. Quite frankly, while these developments may initially lead to additional demand for agrochemical quick-fixes, the increased climate-induced disruptions to global agricultural systems calls for breaking the vicious cycle and building the right conditions for productive and resilient agriculture instead.
In summary, conventional agriculture initiates a vicious cycle rather than ensuring food security: as climate change lowers yields, conventional agriculture responds by intensifying the use of agrochemicals. Between 2000 and 2020 alone, fertilizer use per hectare of cropland increased by 43%, exacerbating climate effects and further diminishing yields. Breaking this cycle requires a shift from optimizing for short-term yield gains to prioritizing ecosystem resilience.