Rising incomes, changing diets, and increasing populations have made the livestock sector one of the fastest-growing agricultural subsectors in middle- and low-income countries. As the global population increases from 7 billion in 2010 to a projected 9.7 billion in 2050, and incomes rise across the developing world, overall food demand is expected to increase by more than 50 percent and demand for animal-based foods will rise by nearly 70 percent. IFC is committed to supporting the agribusiness sector to improve livelihoods and help people meet their nutritional needs, while taking steps to improve sustainable production by limiting use of resources, protecting the environment, and supporting animal welfare.
Through our investments in the livestock sector, we seek to replace inefficient production processes with targeted and efficient practices, a key step in reducing greenhouse gas emissions. We recognize the importance of the livestock sector to livelihoods in many developing countries, and the role that animal protein plays in helping families, especially low-income households, meet their nutritional needs. Our involvement in this sector, including through our advisory work, provides smallholders with access to training, information, and other support that create new business opportunities, improve resource-efficiency, and enhance animal welfare and biodiversity.
In a world where the demand for animal protein is expected to grow, and given the challenges in animal husbandry and food production, it is imperative that support for the industry follows a sustainable growth path. IFC understands that livestock companies that incorporate sustainable management practices are likely to achieve a competitive advantage in the global marketplace while minimizing the environmental and social footprint of their operations.
Preserving the environment is a central tenet of IFC’s operations and we have developed policies, guidelines, and technical notes that guide our activities in livestock projects. These help our clients build environmentally sustainable businesses and operations. IFC is selective when considering a new animal protein investment, and we prioritize climate-smart agribusiness and sustainable production practices.
The core IFC framework for assessing livestock operations centers on animal health and biosecurity, animal welfare, antibiotics, and climate (BAWAC). IFC works with companies that commit to meeting our environmental and social performance standards and that employ good governance, human resources, and appropriate management systems. Our efforts are in line with the broader World Bank Group goals and reflect the commitment we have to addressing the many challenges this sector faces in developing countries.
IFC encourages the adoption of best practices in food safety as well as environmental and social standards and seeks to engage with companies that are committed to raising livestock in an environmentally sustainable way. This not only includes animal husbandry, but also focuses on management practices such as energy efficient equipment, precision farming technologies, renewable energy production, water efficient farming methods, and appropriate waste management systems.
In every investment made by IFC, clients need to make a strong commitment to adhere to IFC’s Performance Standards (PS).
In 2020, IFC had more than 65 active livestock projects with 48 clients around the world, for a total commitment of about $1.1 billion. IFC’s engagements with 21 of those clients had reached the stage where they could be assessed for project impacts in 2020, and benefitted at least 1.4 million farmers in that year. Through these projects, IFC supports rural communities and livelihoods, and seeks to promote opportunities especially for women farmers and entrepreneurs.
The companies that IFC works with have to commit to building robust biosecurity and animal-health protocols and management systems, in line with credible international standards. This includes the responsible and prudent use of antibiotics in animal production. When working with clients, we promote a proactive approach to animal husbandry development that is based on our assessments. This can include specific requirements for the company, as outlined in the Environmental and Social Action Plan (ESAP), which is publicly disclosed for each project, or support through IFC Advisory Services, which can provide practical solutions and training to implementing animal welfare improvements. In addition, we work with clients to support their efforts to seek certification and consistency with credible international or regional standards on animal husbandry, where available. This supports transparency and provides a model for others operating in the same industry.
We work to build inclusive supply chains that improve rural livelihoods for smallholder farmers, small- and medium-sized enterprises, and women farmers. Our investments span different sizes and types of agribusiness companies, and often include components to strengthen the capabilities and output of smallholder farmers and improve their capabilities and output.
Our inclusive business model aims to improve linkages between large-scale companies—which can provide market access, extension services, and working capital for value chain players, among other things—and rural small- and medium-sized enterprises, smallholder farmers, and women.
Photo by Jessica Berlmont/World Bank
|Sector:||Ranching and Beef|
Colombia’s Orinoquía region is a sprawling expanse of tropical savannah, wetlands, and converted ranchland that stretches along the country’s eastern border with Venezuela. In recent years, the region has been swiftly redeveloped to accommodate new ranches and plantations, all while facing an increasingly unpredictable climate.
That led IFC to invest in ranchers committed to reducing livestock emissions and improving land management — an effort that has brought together farmers, the Government of Colombia, the World Bank, and other players.
IFC’s advisory services work in the Orinoquía helps its clients, including Hacienda San Jose and Cialta, adopt climate-smart beef production that reduces emissions intensity, as well as develop deforestation-free supply chains and reduce land degradation. Investing in sustainability will help participating ranchers cater to a growing global demand for sustainable beef, all while ensuring their land remains productive for years to come.
The work is implemented with support from the BioCarbon Fund Initiative for Sustainable Forest Landscapes (ISFL), a multilateral fund supported by donor governments and managed by the World Bank Group, and the Government of Japan.
IFC aims to help ranchers track their sustainability gains first by developing ways to measure greenhouse gas emissions. For example, in the easternmost Orinoquía, IFC is working with sustainability-focused ranching company Hacienda San Jose to estimate the total carbon footprint of its ranching operations, allowing the company to better manage its emissions. The project is being undertaken with help from various specialists and the International Center for Tropical Agriculture (CIAT) — a Colombia-based research and development organization that aims to balance the goals of poverty reduction and the protection of natural resources.
Efficiency gains are another focus of IFC’s engagement, which features work along clients’ supply chains to identify and address gaps limiting their productivity levels. For example, through the IFC project, ranchers in Cialta’s supply chain are receiving technical assistance in topics such as pasture and feedlot management to increase cattle productivity.
These efforts are supported by the ISFL, which aims to help rural communities achieve economic gains while reducing greenhouse gas emissions and protecting the environments on which their livelihoods depend.
The Orinoquía Sustainable Integrated Landscape Program is implemented by the government of Colombia. It promotes the adoption of silvopastoral farming, a method that brings together trees, forage plants, and livestock, and can help farmers adapt to the challenges of a changing climate. These systems can have a range of benefits that include lower greenhouse gas emissions, healthier livestock, and more nutrient-rich soils.
Grants from the ISFL aim to improve land-use planning, protect landscapes, including forests, and provide technical assistance so that livestock, coffee, oil palm, cocoa, and non-timber forestry products (NTFP) businesses move towards sustainable and competitive production models.
Photo by Sarah Farhat/World Bank
|Sector:||Poultry, pork, and beef|
In Zambia, droughts, floods and extreme heat caused by climate change are threatening food systems and impacting rural livelihoods.
Zambeef, one of the country’s largest agribusinesses, is working to meet rising consumer demand for livestock at home and abroad while keeping its emissions in check.
IFC has supported Zambeef’s commitment to environmental accountability by helping it develop a system for more comprehensively monitoring and reporting its carbon footprint in its livestock and meat processing operations.
This initiative follows a loan to Zambeef focusing on growing its supply chain, which includes thousands of smallholder farmers, and better linking rural farming communities with new, higher-value markets.
Zambeef has since been recognized by Zambian authorities for its close compliance with national environmental regulations, and has expanded practices for reducing its environmental impact, including the recycling of organic waste into fertilizer.
IFC’s engagement with Zambeef has also helped the company upgrade its bio-security standards, review and comply with international food safety standards, and continually review and improve its environmental, safety, and social practices.
We work to reduce greenhouse gas emissions through a variety of approaches. Among these are reducing the amount of waste, improving waste management by turning animal waste into biofertilizers and installing biodigesters to reduce methane emissions, cutting down on feed waste, and other steps. We also work to achieve improved resource utilization, especially savings in energy and water.
In our projects, while there might be a net increase in GHG emissions and in resource use from increased production in absolute terms, we support better livestock-management practices that make meat and dairy production more efficient on a per unit basis.
|Sector:||Ranching and Beef|
Paraguay is one of the world’s top 10 beef exporters, but the growth of its livestock industry has hastened deforestation in some parts of the country. Until recently, demand for new pastureland contributed to significant deforestation in the Chaco eco-region—which covers parts of Argentina, Bolivia and Paraguay and is one of the most biodiverse areas in South America.
This is why IFC has been working to implement more sustainable, efficient ranching practices in partnership with Neuland Cooperative, one of Paraguay’s largest beef suppliers.
Those practices focus on improving feed and grazing management, as well as cattle health and breeding, a dual approach that helps reduce emissions while making livestock more productive.
Neuland estimates that the techniques, developed in a 2-year pilot study conducted with IFC, will help the ranches in Neuland’s network reduce emissions by an average of 23 percent. It has established a research and knowledge center with IFC support to further promote the new techniques among its members.
The work comes amid broader efforts by IFC, Neuland, and other players to protect the Chaco eco-region. Neuland’s producers already follow the country’s forestry-use laws, preserving half of all lands it acquires as untouched forest. IFC, USAID, World Wildlife Fund, the Association of Municipalities of Chaco Central and Neuland also worked together to develop a manual for best management practices for beef production in the eco-region.
Behind these efforts, Neuland ranchers see a powerful way to grow their business. Demand for sustainable beef is surging as consumer concerns over the environmental, social, and animal welfare impacts of beef consumption grow. And while improved techniques allow improvements in output, sustainable land management practices better protect the land on which their livelihoods depend.
IFC has meanwhile partnered with the Smithsonian Institution as well as Paraguay’s government, civil society groups, and industry stakeholders to develop the first comprehensive biodiversity map for the Chaco eco-region.
This pioneering, publicly accessible online tool will help guide the IFC and other Development Finance Institutions in making sustainable investments across the Chaco region.
IFC is also working to help other beef producers in Paraguay become part of the solution, developing criteria and guidelines for sustainable Paraguayan ranching based on those outlined by the Global Roundtable for Sustainable Beef.
By working across the supply chain and with stakeholders in industry, government, and civil society, IFC is working to minimize economic impacts on the Chaco eco-region while improving rancher’s productivity, traceability, and sustainability.
Stretching from the Atlantic to the Andes, the Pampas is a lush expanse of plains that have long supported livelihoods in ranching, dairy farming, and agriculture.
In Argentina’s corner of this regional breadbasket, food and biofuel company Adecoagro is working to grow its dairy operations and meet rising global demand for low-cost milk, cheese, and yoghurt.
A green loan from IFC is helping Adecoagro do so while reducing its environmental footprint and protecting animal welfare.
Long-term financing is allowing Adecoagro to improve its sustainability through improvements like the construction of an anaerobic biodigester – a system that uses microorganisms to convert animal waste into biogas.
The innovation is designed to help Adecoagro transition away from using fuel oil at one of its largest dairy facilities, while also becoming a source of renewable electricity to the surrounding power grid.
The loan will support Adecoagro as it acquires and improves the overall resource efficiency of two rival dairy processing facilities. Adecoagro will also overhaul its yogurt and cheese production to curtail plastics use, as well as reduce water and energy consumption.
Animal welfare is a priority for IFC and Adecoagro, with the loan supporting construction of two dairy free-stalls – a method for housing dairy cows that prioritizes comfort, cleanliness, and free movement.
As Adecoagro grows, it assesses the operations of new acquisitions and suppliers to ensure its operations do not involve the conversion of natural and critical habitats.
As Adecoagro works to achieve sustainability gains under the loan, IFC will provide continued technical advice to Adecoagro on improving resource efficiency in their operations.
A thriving livestock sector is a vehicle for countries to reduce poverty and achieve their Sustainable Development Goals. Engaging in the livestock sector represents a major opportunity to create jobs and generate wealth throughout the livestock supply chain, while advancing climate action, strengthening global health, and putting food systems on a more sustainable footing.
|Engagement:||Investment and farmer training|
Keeping cattle is a time-honored cultural tradition in western Uganda. But as families shift to commercial farming to meet the nation’s steadily rising demand for milk, many of them need new training to boost production and get their goods to market.
IFC is working to help smallholder farmers overcome those barriers through its work with Pearl Dairy, owner of the second largest milk processing plant in Uganda.
As part of an $8 million joint investment in the dairy firm by IFC and the Global Agriculture and Food Security Program (GAFSP), Pearl Dairy and IFC launched a program that trained 50 “dairy development executives” to advise hundreds of farmers on techniques to improve productivity and adopt good agricultural practices. The program aims to boost farmer productivity, create a stable supply base of 1,000 dairy farmers providing high-quality raw milk, and reach another 5,000 farmers with advice. Trainers continued to work with farmers to meet that goal amid the COVID-19 pandemic, with participants observing social distancing guidelines.
For many farmers who received the training, rates of milk production have more than doubled.
Boosting output is just one part of the program. An estimated 20 percent of milk produced in Uganda is processed, limiting many producers’ ability to access export markets or wait out price fluctuations.
Pearly Dairy is working to better integrate smallholders into its supply chain, establishing milk collection centers and cold-storage infrastructure for farmers living in remote locations. With farmer’s milk subsequently collected and processed, it can be sold in more competitive markets or simply avoid spoilage – further boosting farmer income.
Ugandans outside of the dairy sector are expected to benefit too, with greater availability of milk and dairy products raising the nutritional intake of local communities.
Food from animals (meat, egg, fish, dairy products) is an important source of nutrients and micronutrients integral to brain development. Nutritionally-rich food can help mitigate chronic malnutrition, which stunts children’s growth and can have an impact on brain development. Through our investments in livestock and our advisory projects, IFC works to improve food security and give people better access to nutritious foods.
Photo by Thiet Dzung/IFC
In Vietnam, rising incomes and a vibrant culinary scene are feeding a growing national appetite for chicken.
The country’s poultry sector, however, often lacks the practices needed to protect consumers, limit antibiotics use, and ensure proper hygiene for chicken populations.
IFC’s Vietnam Food Safety project has worked to help Bel Gà JSC, a major poultry breeding firm, reduce food safety risks and adopt better agriculture practices.
Under the project, Bel Gà retooled operations at its breeder farm, hatchery factory, and three broiler farms, taking steps to improve food safety, reduce the risk of biological contamination, and curtail antibiotic usage.
Those moves have helped Bel Gà earn certification from private GLOBALG.A.P., an independent, internationally recognized food safety regulator.That certification has not only protected consumers. It has allowed Bel Gà to begin exporting its product to
Japan, and made it easier for Bel Gà to attract financing for its expansion plans. Bel Gà estimates its new biosecurity practices have also generated cost savings estimated at $300,000 between 2018 and 2020 from fewer chicken losses.
IFC’s Vietnam Food Safety project is building on its success with Bel Gà by working with independent poultry farms in Vietnam looking to earn food safety certifications from GlobalG.A.P.. These engagements also focus on improving the occupational health and safety of farm workers, and on environmental compliance such as waste management and wastewater treatment.
By showcasing a better way of doing business, IFC hopes to encourage other poultry farmers in Vietnam to improve their practices, meet consumer demand while reducing the global toll of foodborne illness, end antibiotics overuse, and safeguard animal health.