The Argentine Carbon Neutral Program (PACN): A local proposal to accelerate the implementation of carbon footprint calculations and management for products in agrobusiness chains

In the context of the 2030/2050 global climate action agenda, agribusiness plays a key global role, with multiple impacts: environmental mitigation through efficient production, nature-based solutions, socio-economic development, and food security. Today, incorporating environmental performance indicators into production strategies is no longer an issue. Benefits include efficient production, social approval, brand loyalty and economic and financial returns in a green economy environment regulated at both the public and private levels. To that end, different reference frameworks, product guides and calculation tools have been developed worldwide, which in most cases are very affordable or even free of charge for small-scale primary producers. Even so, there is still a low rate of adoption, monitoring, reporting, and carbon footprint certification per product or good, regarding scope 3 carbon footprints in an organization. In many cases this results in calculations based on default values, leading directly to zero subsequent management of the indicator.

So what is keeping agribusiness value chains from calculating and managing this environmental variable?

Although the carbon footprint indicator has a well-defined worldwide protocolized calculation methodology, based on IPCC guidelines and emission factors published with references in international databases, its first methodological definition depends on a life-cycle analysis on a local level. While calculation methodologies are internationally validated and accepted, the first definition to implement a carbon footprint calculation is site specific. The availability of global tools for local production processes is therefore the first major obstacle to doing the calculation. There is no globally tailored suit that fits any productive actor in a field or establishment in a particular production environment. Even more so if we consider that the success of an insertion depends on this calculation and its result. Therefore, the first condition is to develop calculation tools adjusted to local production practices, activity data and available documentary evidence. The tools must be easy for producers to use and must faithfully reflect their own process.

Second, global calculators multiply activity data with emission factors from international databases. For example, consumption data for a given pesticide may be multiplied by a global average environmental profile of that input, or the impacts of energy consumption may be multiplied by emission factors that do not correspond to the energy matrix of the community where the activity is taking place. This can be repeated in all inputs and outputs of the calculator model. There is no way in global calculators to input properly validated local emission factors. The same is true for emission removal opportunities.

Finally, the introduction of a new indicator depends on the transfer of skills to ensure that use of the tool can overcome a low implementation rate. Implementing an indicator, managing it, and communicating it within a value chain without fully understanding it, and even more so without being able to identify its positive spillovers for different stakeholders, can cause limited adoption.

In view of this context, an initiative arose in Argentina from the productive sector itself, the Argentine Carbon Neutral Program (PACN, for its acronym in Spanish). This non-profit program is a federal, collaborative ecosystem in Argentina's major Grain and Trade Exchanges (Buenos Aires, Bahía Blanca, Rosario, Santa Fe, Córdoba, Entre Ríos and Chaco). The objective of the PACN is to generate private-sector tools to facilitate calculation and management of carbon equivalents for agro-industrial products from the field to the point of export or domestic marketing, in line with internationally validated protocols. To this end, sectoral roundtables have been set up for each agro-industrial chain, with the participation of players in all the links: inputs, technologies, primary production, storage, industrial plants, export, logistics, packaging, and packing, among others. Members of the roundtables provide their own auxiliary, control, and/or validating cases for the production models to define the local life cycle assessment, which is the basis for the calculation tool model. This tool, as it develops its inventory, identifies the availability of reliable local emission factors, or else the need to develop them at later stages and, in that case, whether to incorporate values from international sources.

As a second tool, a user's guide was developed to monitor participants when loading their activity data into the calculator, to ensure it is in line with an independent third party's certification requirements for the calculation protocol. At the same time, a good environmental practices manual is being developed, focused specifically on practices that affect carbon mitigation or removal in each production link, so the calculator can be used as a platform to evaluate the environmental impacts of potential projects. This manual is aligned with the Sustainable Development Goals (SDGs) and the Global Reporting Initiative (GRI) series of reporting standards. To implement this project, producers commit to participate actively as members of sectoral roundtables, making technical and financial contributions to enable the work. Each PACN sectoral roundtable, along with the program's technical staff, hires a group of consultants with expertise in climate change, LCAs, carbon footprints and the specific sector. Their challenge is to address the specific productive sector in its development process. This results in tools that are easy to implement locally and whose development process leads to very specific projects to transfer skills and knowledge to each member company. The aim is to empower the productive sector. The project has a term of nine calendar months. Once the project is complete, the tools will be published, providing free access to all producers in the chain, in order to encourage widespread adoption of the tool.

The PACN also works proactively with certifying agencies to generate local accredited groups that can monitor the certification process of any producer needing support, for the total or partial scoping of each product's carbon footprint. It also interacts with financial institutions to generate information from the productive sector for banks to be able to accurately assess emissions financed within their client portfolio. The objective is to assemble the puzzle so as to benefit all parties and make a solid contribution to global climate action.

Currently, the PACN has developed tools in its oilseeds, corn and sorghum, wheat, dairy, and barley roundtables for 18 products (functional units), with the participation of more than 60 members of different sizes and from different regions, throughout Argentina. The Program's main challenge today is funding. Some local economic chains do not have the in-house capital available to finance their sector’s development. It is therefore essential to identify external sources to fund more PACN roundtables that can have spillover effects for the entire agribusiness sector and make a science-based contribution to global mitigation.

* Sabine Papendieck is a Consultant in international trade, market access and sustainability at ESTRATECO.