Guest Blog Post by Magnus Berg Johansen about Workshop C2 at TBLI CONFERENCE EUROPE 2015 on investing in sustainable agriculture. The panelists included Tanja Havemann: Director & Founder Clarmondial GmbH, Peter van der Werf: Engagement Specialist at Robeco Institutional Asset Management, Arnold Lau: Senior Vice President at Iroquois Valley Farms LLC, and Martin Poulsen: Partner at The Moringa Partnership.
Views and opinions are that of the writer and are not the official views of TBLI CONFERENCE.
What is the best way of investing in sustainable agriculture? Is it possible to merge profits and organic farming? Can one by adding certain components to the business model increase output? These were some of the questions that were raised during the session that tried to showcase how one could approach sustainable agriculture.
The session started off with Tanja Havement stressing the importance of agriculture when it comes to the CO2-challenge, employment in emerging markets and for gender equality.
Arnold Lau from Iroquois, a fund focused on incentivizing mid-size farmers in the US to grow organically, then took the floor as the first presenter. He started of stressing the fact that only 1 prosent of the farming done in the US currently is done organically.
The market is very much a nice, but the demand is growing strongly due to consumer interest. As the cost is higher, the market share remains low and this thus hold back any economics of scale.
Lau said that many find organic farming a fad and that it is too risky. But at the same time he is excited with the fact that the management of 70 percent of US farms will shift generations during the next 10 years.
What is more, one of the main hurdles to rapid expansion in this area is because organic farming does not pay off immidiately but when done continuously for many years it is the most productive approach – mainly because the land becomes richer year after year. Eg. the moisture is better remined in the ground.