INSIGHT
Additional cropland equivalent to that of Brazil ’ s is required by 2030 to sustain the world ’ s demand for food , feed , fuel and natural capital
of converting [ iii ] 70-80Mha of pastureland to cropland could cost $ 300 billion . The value of these investments is likely to be significant , accounting for the higher market price of cropland over pastureland and the added value related to the protection of climate and biodiversity .
However , this will require intentional collaboration between public and private sector players .
Nelson Ferreira , Senior Partner at McKinsey said : “ The world will need both sides of the supply , demand equation to strike a balance . Adverse climate conditions and other shocks to market dynamics could put even more pressure on supply than our conservative case assumes .
McKinsey & Company has released its latest insight on catalyzing a sustainable land use transition , revealing that 70- 80Mha of additional cropland , equivalent to all of Brazil ’ s [ i ] cropland or 3x Tanzania ’ s [ ii ], will be required by 2030 to sustain the world ’ s demand for food , feed , fuel and natural capital .
The report “ Striking the balance : catalyzing a sustainable land use transition ” notes that most of the demand is driven by three principal factors : feedstock , food and fuel . McKinsey anticipates that producing feedstock for livestock production may account for around 70 percent of all incremental cropland needed by 2030 ; crop production for human consumption around 20 percent ; and biofuel production the remaining approximately 10 percent .
While the requirement calculated by McKinsey ’ s model represents less than 10 percent of additional cropland for feedstocks compared to today , it is a significant ask when competition for available and suitable land parcels in other vital areas is intensifying .
Hotspots of competition are already emerging in Latin America and Sub-Saharan Africa , which are
likely to be the source of most additional cropland , where land and food prices could increase .
Amandla Ooko-Ombaka , Partner at McKinsey said : “ Today 60 percent of the earth ’ s habitable land is in use by humans . But the appetite for land – particularly for food and fuel is putting pressure on arable land . But unlike in previous decades , new cropland cannot come from deforestation .
We need to change how we use land to meet our commitments to climate and nature , whilst feeding a growing global population .”
To meet and , where possible , offset additional land demand , McKinsey highlights that conversion of degraded land , stronger yield growth and efficiencies from increased trade will be required . However , it ’ s likely this won ’ t be sufficient alone and actions to reduce land demand such as behavior change , reducing food waste and seeking alternative offshore resources are most likely required for a sustainable land transition .
The report notes that these actions would require substantial investment from both public and private stakeholders — for example , an estimate
Striking the balance is critical for both public and private sector players . Input providers need to know that land prices will increase by the end of the decade . Farmers ’ margins will decrease , and input providers need to understand what it means for farmers . Funds investing in land need to know that some of the hotspots for food , fuel , and biodiversity are the same . There could be a race for prime spots of land – so they have to decide where to go now . Similarly , governments can help create the right incentives and investment in public infrastructure to support a sustainable land use transition , for example , irrigation to support restoration of degraded land .”
To start to deliver a solution , McKinsey states that a mix of rigorous land use analytics that create an evidence base for net-zero and naturepositive transitions and a pragmatic approach to quickly act on yield , trade and land conversion levers are important . The report identifies 10 “ acceleration actions ” that target specific sectors , with the potential to offset more than half the land needed by 2030 – for example scaling up resilient agricultural practices including double-cropping , increasing energy and power crops like brassica carinata , and implementing nature-based solution carbon credits through reforestation and conversion of pastureland to forest cover .
Ooko-Ombaka added : “ With just six harvest cycles until 2030 the risk of passing crucial climate tipping points on the path to net-zero could be substantially higher if we do not act now . Every organization that uses land in any way — or that is concerned with food security , energy security , or the protection of the environment — should be part of the solution .”
28 | November - December 2023