May 2, 2014

Transforming Commodity Markets for Conservation at the Landscape-Level

By: Kedar Mankad, EcoAgriculture Partners

The environmental impacts of commodities have been a hot topic lately, from haze in Indonesia, carbon emissions from Brazil, and environmental degradation and poverty in Cote d’Ivoire.

What do these stories have in common? They are all intertwined in global value chains for major agricultural commodities: palm oil, soy, and cocoa. Areas of production of these commodities also happen to overlap with biodiversity of global significance.

These production areas are increasing. Since 2008, the area harvested for palm oil has increased by over 2.4 million hectares; soy has increased by over 8 million; and cocoa by over 370,000.  What do these numbers mean for maintaining biodiversity of global significance?

The solutions have inevitably ended up in two main buckets: “land sparing” or “land sharing.” In their most basic forms, land sparing is the idea that production areas are maximized so other areas can be set aside for conservation, and land sharing presents a more complex mixed-use landscape where conservation efforts can specifically support agricultural production. Unfortunately, the world is not binary, and therefore solutions cannot be either.

In 2007, recognizing the need to both improve production areas and protect biodiversity of global significance, the Biodiversity and Agricultural Commodities Program (BACP) was initiated. BACP was created as a grant-making facility, led by the International Finance Corporation, that sought to transform the markets for palm oil, soy, and cocoa to generate incentives for greater supply, demand, and financing of commodities that were produced sustainably. BACP focused its efforts on influencing voluntary sustainability standards (VSS), many of which at the time—like the Roundtable on Sustainable Palm Oil and Roundtable on Responsible Soy—were nascent initiatives with significant multi-stakeholder support but little market share.

Since 2007, grantees such as World Resources Institute in palm oil, Solidaridad in soy, and Armajaro Trading in cocoa have been able to find innovative solutions to managing areas of high conservation value, working with smallholders, training and capacity building, and impact assessment. Over the next three Fridays, I will go into further depth on the work of grantees like these over the past 5 years to mainstream biodiversity in agricultural commodity landscapes.

As the monitoring and evaluation unit of the program, EcoAgriculture Partners has synthesized insights from five years of work by 21 institutions in three sectors in the new report Transforming Markets for Conservation.

Transforming markets for conservation through voluntary standards requires targeted investments that generate robust evidence of impact at multiple scales, and that can drive market demand while removing barriers to sustainable production.

One of our key recommendations is for value chain stakeholders to focus on landscape-scale impacts. Sustainability standards are at present, focused on farm-scale better management practices and/or conservation set-asides. These are worthy pursuits, however multiple institutions have found that these “islands of sustainability” in seas of unsustainable practice simply cannot address critical issues in commodity landscapes. Meaningful achievements will require incorporating and adapting existing tools to monitor and assess impacts at multiple scales, and building mechanisms for coordination among all decision makers in a landscape.

By focusing on biodiversity as an essential function of sustainability, stakeholders can more comprehensively account for and manage the complex and interconnected challenges facing agricultural value chains.

We encourage you to read the report, and come back to the Landscapes Blog next week for a discussion of efforts to promote sustainable soy.

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