Europe steps up investment in climate-resilient farming

With Britain about to record its hottest summer yet, Sam Squier's nearly 200-acre beef farm in south east England stands out as a lush, green oasis surrounded by scorched brown fields. As neighbouring farmers have resorted to using winter feed, Squier’s herd of Aberdeen Angus feeds on dense pasture maintained by planting that has retained water and improved soil quality. “This year is a testament to what you can do in a dry year,” Squier told the media.

“Our vision was to improve the soil structure and build resilience within our business, mitigating against both prolonged periods of dry hot weather and prolonged periods of wet weather,” he said. His cattle, which carry genetic traits from Japanese Wagyu that are renowned for producing tender beef, graze on a mix of grasses, deep-rooting herbs and legumes, known as herbal leys. The method is inspired by ancient practices and reflects decades-long efforts to introduce climate-resilient farming as governments and regulators across the world have sought to make supply chains less vulnerable.

After years of intensive agriculture that was designed to feed the maximum number of people most cost-effectively, this year’s extreme weather has added urgency to the debate over whether climate change has transformed the economics. According to Reuters’ interviews for this story with more than 25 people engaged on the issue, banks, insurance groups, water companies, governments and major food groups such as McDonald’s are funding a shift in farming practices.

Cattle farmer Sam Squier herds his Aberdeen Angus cows on a green pasture at Humphreys Farm in Great Waltham, Chelmsford, Britain. Photos: Reuters

Meteorologists have said they expect to declare Britain’s summer, which officially ends on August 31, the hottest yet and Europe as a whole has this year experienced more extreme warming than any other continent with five heatwaves and far below average rainfall. After its hottest June and driest July on record, almost three-quarters of England is officially in drought.

Livestock and dairy farmers have reported poor grass growth, the UK’s cereal harvest is set to be the worst since comparable records began in 1984, and fruit and vegetable growers have said production will be reduced, echoing warnings from across Europe. The losses for farmers in the European Union and Britain from failed crops in the June heatwave could be up to €2.3 billion ($2.7 billion), according to the Energy and Climate Intelligence Unit. There are knock-on effects for inflation, which has already been driven higher by the increased energy and fertiliser costs linked to war in the Middle East.

By contrast with the arid land all around, the herbal leys in some of Squier’s fields, near Chelmsford, stand over knee height even after two months without rain, and without the use of irrigation. The grasses provide energy-rich feed, the nutrient-enhancing herbs help to control parasites and reduce the need for medication, while the legumes fix nitrogen in the soil, removing the need for artificial fertilisers.

The cows are concentrated in a small area where they graze and trample the vegetation and are moved twice a day. They create a protective layer over the soil and their manure helps return seed to the ground, boosting soil health and water retention. Squier has not needed to buy winter feed for eight years.

He estimates the soil holds around 400,000 litres more water per acre than before he adopted regenerative farming. In the first six years after the switch, estimated earthworm numbers rose from 80 million to 680 million. Government environmental grants helped Squier make the transition. Without giving precise detail, he said his farm would struggle to remain viable without that support. He also said ownership and tenancy arrangements, financial constraints and resistance to change were a problem for others.

An increasingly popular solution is to work with companies from across a range of sectors including insurers and banks, which have an interest in protecting themselves from the consequences of extreme weather, and as evidence mounts that it is worth investing in different farming methods.

“Farms adopting ... regenerative practices are consistently outperforming more conventional holdings during drought stress in terms of both yield and profitability,” Andrew Voysey, Chief Impact Officer at agriculture consultancy Soil Capital, said.

He cited a study for the organisation that found farms that adopted regenerative practices reduced drought-related yield losses by at least 10% in around 85% of cases. In Britain, Lloyds Bank has joined forces with regenerative food business Wildfarmed to create the Food & Nature Resilience Fund, alongside water companies Severn Trent and Affinity Water and insurance group AXA XL. Pooled funds go to farmers to improve soil health.