By Sophie Kevany for Sentient.
Broadcast version by Nadia Ramlagan for Kentucky News Connection reporting for the Sentient-Public News Service Collaboration
Fifteen development banks and a fund tasked with supporting sustainable economic growth are investing billions of dollars to expand factory farming in the global south and other lower income countries, a new analysis from the non-profit Stop Financing Factory Farming finds. The lower income countries where banks are funding industrial agriculture are often the same countries that are more vulnerable to the extreme weather linked to climate change, which itself is fueled by industrial meat and dairy operations. The analysis finds 15 banks and one fund, including the World Bank Group and the United Nations' Green Climate Fund, invested just over $3 billion on animal agriculture in 2023, with over three quarters of the funded projects described by the researchers as factory farms. Another $3.4 billion was marshaled from other private and public funders.
Factory farms are responsible for between 11 and 20 percent of global greenhouse emissions, as well as a host of other impacts like water pollution, pandemic risks and animal suffering. The analysis is based on data from a civil society database called the Early Warning System, which collects funding information from project websites.
Development Bank Investments May Contradict Climate Goals
A number of climate models predict populations in developing countries will consume more meat as incomes increase, yet the new analysis finds the investments from development banks encourage the production of feed crops for farm animals, not humans, worsening food insecurity. Many of those animals are exported: a 2021 paper found developing countries provide nearly 80 percent of international poultry exports by volume, for instance.
"These investments often generate negative consequences for local communities and for animal welfare... [creating] hurt at many levels, locally, globally and for the environment, the climate, people and animals," Alessandro Ramazzotti, a researcher with the International Accountability Project, tells Sentient. The International Accountability Project is a member of the Stop Financing Factory Farming coalition.
Factory farm investments hurt the financiers themselves, as well, Ramazzotti says. "Development banks have climate change goals and if they keep investing in animal agriculture, especially when this is industrial, large-scale, they are not going to meet those commitments."
This tension is especially clear at the World Bank Group, the largest development investor by volume in factory farming projects. The bank says it is aligned with the Paris climate agreement goal of keeping warming to 1.5 degrees Celsius. It also published a report suggesting subsidies be redirected away from "emissions-intensive, animal-source foods," which account for almost 60 percent of total food-related emissions.
Despite its climate goal and the report, one of the World Bank's members, the International Finance Corporation, invested $501 million in factory farming in 2023, including a $47 million loan for a multi-story pig farm, the analysis finds.
A statement from the International Finance Corporation reads in part: "Animal protein is important for nutrition, especially in several of our client countries where early childhood and maternal undernutrition and micronutrient deficiencies remain pervasive and animal-source foods consumption is far below the recommended amount. There are 1.3 billion people whose livelihoods are tied to livestock and we also know this sector is responsible for over 30 percent of the global GHG emissions...IFC works with livestock clients that are committed to enhancing animal health and welfare, protecting the environment, and promoting food safety...By investing in sustainable solutions that intensify production and improve efficiency in livestock operations, it is possible to reduce global GHG emissions and eliminate deforestation in direct and sourcing operations while providing affordable and safe food in emerging markets."
Shifts from Beef to Pork Present Risks and Tradeoffs
In the past several years, analysts for development banks have also argued for shifts from large-scale beef operations to pork and poultry, citing the lower emissions associated with these foods. A 2021 document drafted by the European Investment Bank, described non-ruminant meat - essentially pork and poultry farms - as a climate-friendly investment option. Last year, the same bank invested $427 million in factory farming, the new analysis says.
Shifting factory farms from one animal to another because they produce lower emissions does not make it a good idea, says Ramazzotti. "In the case of the multi-story pig farm in China, that is supposed to limit the environmental impact, yes, but then what about animal welfare?" There are other impacts to consider, Ramazzotti adds. "Farms like that are a big risk for human health, because they are a great place for viruses to develop."
A spokesperson for the European Investment Bank responded in part that "EIB Group's lending policies for farming, agriculture and the bioeconomy are fully aligned with the EU's strict legal framework, including European Green Deal policies, as well as with legislation regarding animal welfare." The full statement is here.
The spokesperson also criticized the report's characterization of some projects as "entirely unrelated to animal production."
In an email to Sentient, Ramazzotti provided a specific description of each of these projects, and responded more generally: "those three projects have been included because the EIB's project disclosures are among the worst of all MDBs in terms of transparency - and therefore one of the most challenging institutions to analyze and hold accountable." The full response is here.
The contradiction between climate goals and climate investments are not unique to development banks. The United Nations has reported that animal agriculture is a disproportionate threat to biodiversity and the environment, and that eating more plants would reduce those threats, improve human health and lower the risk of pandemics. Meanwhile, the United Nations' Green Climate Fund, an initiative that aims to help reduce greenhouse gas emissions in developing countries, invested $175 million on industrial animal agriculture last year, the analysis finds.
Funding Better Projects
In Mongolia, Ramazzotti highlighted the irony of development bank funding for an industrial cattle project in a country already suffering from extreme weather known as the dzud. The dzud is characterized by dry summers and freezing winter temperatures, heavy snow and frozen ground. "And here, the International Finance Corporation is proposing an investment in an industrial cattle farm. As I understand, the investment is not likely to benefit, or only marginally, local people and it will increase the pesticides on feed crops and the methane produced by cattle, plus the farm is near a coal producer, and in a valley, which makes everything worse for the local people," he says.
Stop Financing Factory Farming is asking the financiers to stop funding industrial livestock operations at this scale, and instead shift investments toward farming systems that put "communities first and protect the planet."
In response to Sentient's request for comment on the report, the United Nations, the Green Climate Fund and the African Development Bank did not immediately comment on the analysis.
Yet a change of direction is entirely possible, the analysis finds, citing the same Green Climate Fund for supporting some low-carbon projects. One example is a fund to help women farmers in Cote D'Ivoire adapt to climate change in a variety of ways, including boosting financial literacy and knowledge of land rights.
Sophie Kevany wrote this article for Sentient.
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By Seth Millstein for Sentient.
Broadcast version by Danielle Smith for Tennessee News Service reporting for the Sentient-Public News Service Collaboration
Since the beginning of April, President Trump has announced a number of new tariffs on countries around the globe, most notably China. While exactly which tariffs will remain in place long-term is changing day-to-day, the trade war with China appears to only be escalating. This is certain to have major impacts on the agriculture industry, and the consumers who rely on it for food.
Trump’s tariff plan, as originally announced, contained two different “layers.” The first was a 10 percent tariff on exports from all countries, while the second was an additional, “reciprocal” tariff on 60 specific countries. The reciprocal tariff rates differed from country to country, and were ostensibly going to be applied to countries with large trade deficits with the U.S.
Just hours after the tariffs took effect, however, Trump reversed course and announced a 90-day “pause” on the reciprocal tariffs. The first layer of tariffs remains in place, however.
In the same announcement, Trump said that tariffs on China will be increased to 125 percent. This comes after the Chinese government, as widely expected, imposed retaliatory tariffs on American exports in response to Trump’s initial announcement.
How the Tariffs Will Impact Agriculture
Trump’s tariffs will have major impacts on a wide swath of American industry, and agriculture is no exception. The exact nature of those impacts, however, may not be what the president is expecting.
Ultimately, the goal of tariffs is to incentivize domestic production and disincentivize imports — in other words, to reduce international trade. But this is a mistake, says Andrew Muhammad, professor of agricultural and resource economics at the University of Tennessee Knoxville.
“International trade is a means by which you can consume beyond your ability to produce,” Muhammad tells Sentient. “It’s good for an individual. It’s good for a city, it’s good for a state and, of course, it’s good for a country.”
“Good,” of course, is relative. Increasing our consumption options in this regard might make our lives feel more plentiful, and more consumption is certainly good for producers’ bottom lines. But overconsumption is a problem; we already consume the planet’s resources at an unsustainable rate, and this definitely is not good for the environment, animals or our long term prospects as a species.
Nevertheless, it’s helpful to look at what happens when international trade is artificially restricted via taxation in the way Muhammad describes. And that’s exactly what Trump’s tariffs — and all tariffs — aim to do.
Higher Costs & Lower Profits for Producers
Although it’s impossible to say with certainty how this trade war will pan out, it’s almost certain to result in higher prices and lower profits for Americans, at least in the short term.
Higher Costs & Lower Profits for Producers
From an economic standpoint, Trump’s tariffs will likely cause pain for both agricultural producers and everyday Americans. That’s because tariffs usually cause what’s called a price wedge — a type of economic inefficiency that results in buyers paying more, and sellers earning less, than they otherwise would have.
On the production side, the tariffs will make business less profitable and more costly. Retaliatory tariffs on the U.S. will result in less international demand for American agricultural products, which will hurt agricultural exporters’ bottom lines.
Any American company that sells beef to China, for instance, will see a dip in their profits thanks to the tariffs, as their products will suddenly cost more for Chinese buyers. This, in turn, will incentivize Chinese importers to buy from non-American sources instead, and it’s already started happening: Since Trump’s tariff announcements, China has started buying more beef from Brazilian producers, a move that experts predict will lead to increased deforestation in the Amazon.
But it’s not just exporters. A whole lot of farming equipment is manufactured abroad, and even products that are built in America are often sourced from foreign parts. Because of this, any agricultural producer who uses foreign products at all will have to pay more for them than they would without the tariffs. This applies to tractors, backhoes, combine harvesters, captive bolt pistols and any other piece of equipment that might reasonably be used on a farm.
Muhammad points out that, thanks to the complex and highly interconnected nature of modern economic markets, plenty of agricultural producers who might not think of themselves as exporters or importers are nevertheless deeply enmeshed in international trade, and will be impacted by the tariffs.
“Whether you think you’re connected to global markets or not, there’s a high likelihood that a retaliatory tariff will depress the prices you receive in the market,” Muhammad says. “Trade dynamics with China will filter down into the market prices [producers] receive.”
Higher Prices for Consumers
All of the above factors mean that American food producers will likely make less money than they were before as a result of Trump’s tariffs. The cost of doing business will go up, and if history is any guide, producers will respond to this by charging more for their goods.
A key factor for producers is whether the Trump administration’s U.S. Department of Agriculture will provide financial relief to farmers as the Department did during President Trump’s first term.
For now, it appears Americans will almost certainly be paying more money for groceries than they were before. Foods that are primarily or largely sourced from other countries will likely face the highest price hikes, and Muhammad cites hamburgers as a prime example of this.
Beef As Case Study
The U.S. beef trade is a complicated topic, as America is both a leading exporter and a leading importer of beef. This might seem odd, but it’s because beef is sourced and produced in different ways depending on the country. Generally speaking, the U.S. imports lower-quality forms of beef and exports higher-quality cuts.
Burgers are made from ground beef, and between 20 and 30 percent of ground beef in America is imported from abroad. American burger producers are especially reliant on imported lean trimmings, a lower-quality form of meat that they combine with domestically produced fat trimmings to create ground beef.
Tariffs will make it more expensive for these producers to acquire lean trimmings from abroad. You might think that this would compel them to purchase more trimmings from American cattle farmers; however, due to the way cattle is fed in the U.S., American beef farmers are not well-equipped to produce lean trimmings at the volumes needed to replace foreign trimmings.
Of course, retaliatory tariffs make it less profitable to export beef, too. With that being the case, couldn’t U.S. farmers simply use high-quality, domestically produced cuts of beef that they otherwise would have exported to fill the gap in lean trimmings?
Not exactly. In addition to the fact that this would result in a different-tasting burger that customers might not prefer, ground beef goes for a cheaper price on a per-pound basis than steaks, roasts and other products made using high-quality cuts of beef. It wouldn’t make economic sense for beef producers to grind up that meat and sell it for a lower price than they were receiving before.
“It has sort of two compounding effects,” Muhammad says. “You have depressing beef prices in terms of what we export, but inflating beef prices in terms of what we import. And since we export something very different from what we import, that’s not going to balance out.”
No matter how you slice it, the end result is the same: more expensive burgers.
(Some) Empty Shelves
In addition to raising prices for everybody, buyers of agricultural goods could face an additional consequence due to the tariffs: shortages.
This doesn’t mean Americans will suddenly be facing a food scarcity crisis. What it does mean is that some manufacturers might be disincentivized to produce certain foods, specifically those with very low margins.
Blueberries, for instance, have a very low markup. They’re only sold for slightly more than they cost to produce, and so in order to be profitable, producers need to sell them in very high quantities. But if the price of importing them increases, even by a little bit, it may no longer be profitable to sell blueberries at all.
“If you are an importer of blueberries, you’re making your money off the fact that a bunch of people will buy blueberries, not that on a per-unit basis, you’re making a high [profit],” Muhammad says. “When tariffs make that low markup non-competitive — when you can’t pass the price along to consumers, because they’re only going to pay so much for blueberries — you could actually then see some decreases in availability, as well as higher prices.”
In a broader sense, any agricultural goods that can’t be produced domestically, or can only be produced in relatively small quantities, may be in short supply as well. This includes out-of-season fruit and vegetables, and goods that are required to be made in another country, such as Mexican beer or Scotch whiskey.
Will Tariffs Increase Domestic Food Production?
The “upside” of tariffs, at least according to their proponents, is that they make domestic producers more competitive with their foreign rivals. Will U.S. food producers “rise to the challenge,” and begin producing more food domestically?
Not necessarily. Making more food in the U.S. would require farmers to increase their production capacities, and this costs money. But such an investment would only be worthwhile for as long as the tariff is in place; the moment it’s gone, this excess production capacity becomes a wasted investment, as there’s no longer a market for the extra food being produced.
As Trump has already shown, tariffs often don’t remain in place for very long. The administration has even stated that the tariffs are a “negotiating strategy,” and as such, American firms have little incentive to treat them as anything other than temporary.
“All they’re gonna do when they’re temporary is just raise prices,” Muhammad says. “In theory, they’re supposed to also increase domestic production. But unless there’s some excess capacity unrealized, where we can ramp up production without investment, you won’t get any increase in output unless someone can guarantee that the tariffs are permanent. But the problem is, even if they last four years, that’s still not permanent.”
Will Tariffs Increase Farm Consolidation?
Over the last half-century or so, small farms have increasingly been acquired or put out of business by large agricultural producers. This phenomenon is referred to as consolidation, and because tariffs will hurt farmers’ bottom lines, they could accelerate consolidation in the agricultural sector.
But they might not, either. Muhammad says that, although increased consolidation is a possibility, large producers may be reluctant to buy up smaller farms, given that the tariffs may only be temporary.
“If I wanted to acquire another firm, I would need to know that these tariffs are in place for life,” Muhammad says. “What’s the point of investing in expanding capacity to take advantage of economies of scale when I need a tariff to still be competitive?”
The Bottom Line
This isn’t the first time Trump has waged a trade war. He did so during his first term as well, and the results were not good: The U.S. economy shrank, American companies lost nearly $46 billion and an estimated 300,000 Americans were put out of work.
It’s too soon to say exactly what the results of these new tariffs will be. But there’s little reason to believe that they’ll be any different than the last time, and if that’s the case, things are going to get a lot worse before they get any better, including in the agricultural sector.
Seth Millstein wrote this article for Sentient.
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Working without fanfare, federal scientists at 22 U.S. sites maintain the nation's agricultural plant species collected since 1898, including crops native to New Mexico. But the Trump administration's DOGE agency has fired them. The move creates uncertainly for hundreds of crop species that undergird the country's food system. The U.S. National Plant Germplasm System safeguards the genetic diversity of agriculturally important plants.
Iago Hale, associate professor of specialty crop improvement at the University of New Hampshire, said the potential loss of these "seed bunkers" should alarm every American.
"If you subsist totally on chicken nuggets and KFC, that's fine - understand that that comes back to plants grown in the field. The breading on your fried chicken, the French fries that you're eating - these are all products of crops, and this is how it works," he said.
A court order has temporarily reinstated some of the 300 NPGS scientists, but it's unclear when their work will resume - putting 600,000 genetic lines of some 200 crop species in jeopardy. New Mexico's pinto beans, jujube and ornamental species are included in the crop research and improvement dataset historically housed through the NPGS.
Hale said the NPGS is central to the nation's preparedness, because the food system is only as safe as our ability to respond to the next plant disease. Unless dormant seeds are continually cared for and periodically replanted, Hale noted the lines will die, along with their evolutionary history. Hale said potatoes, the fourth-largest crop, require even more care than wheat or corn.
"They're not maintained as seed, they're maintained as potatoes - it's a clonally propagated crop, and there is no long-term storage for those things. So, the nation's entire potato collection has to be grown out every year - has to be regenerated every year, without fail, or it will die. And the potato season has been disrupted," he explained.
Hale said apples also must be maintained as living plants in the open field and scientists follow strict requirements to sustain genetic purity. In the 1980s, he notes, scientists at a gene bank in New York helped identify genetic traits that made apples resistant to several destructive diseases, including deadly fire blight.
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Missouri ranks second in the nation for the number of farms, with more than 85,000.
Beginning farmers in the state and across the nation may soon get a boost from Washington. Beginning farmers are defined by the U.S. Department of Agriculture as those who have farmed for 10 years or fewer.
The bipartisan "New Producer Economic Security Act," recently introduced in Congress, proposes a USDA pilot program to help new farmers overcome key challenges such as securing land, funding operations and accessing markets. Between 2017 and 2022, Missouri saw an almost 8% drop in farmland, making it harder for young farmers to get started.
Nicholas Rossi, policy specialist for the National Sustainable Agriculture Coalition, explained the looming changes in the agricultural industry.
"The average age of a farmer in the United States is 58 years old, I think a little above 58 years old," Rossi pointed out. "We see in the next couple of years there's going to be one of the largest transfers of agricultural land this country's seen in a long time."
The program could fund low- or no-interest loans, land-access grants and community-ownership models such as land trusts and co-ops.
Nationally, the 2022 Census of Agriculture showed beginning farmers make up 30% of the country's more than 3 million farmers, an increase from just over 26% in 2017.
The stakes are high when it comes to who gains access to farmland in the years ahead, Rossi emphasized.
"A lot of that land that's transferred is either going to go and just continue to make the biggest farms bigger, or it can go towards this next generation of farmers," Rossi stressed. "We can hope we try and reverse that trend of decreasing amount of family farms in the U.S., and also looking at decreasing the average age of farmers in the United States."
Statistics show states along the East and West coasts had a high share of farms with beginning producers compared with farms in the Midwest. Rossi hopes to see the pilot program become a permanent part of the comprehensive Farm Bill.
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