Cattle line up at a trough in a feedlot, which are now widely used in Argentina. Credit: Courtesy of Ana Garcia

By Daniel Gutman
BUENOS AIRES, Aug 6 2018 (IPS)

Beef is one of the symbols historically identified with Argentina. After lean years, production and exports are growing, as is the debate on the environmental impact of cattle, which is on the radar of environmentalists and actors in the agricultural value chain.

The problem of greenhouse gas (GHG) emissions – methane and nitrous oxide – from livestock farming has been raised since the 1992 Rio de Janeiro Earth Summit.

But “it was very hard to get Argentina to take it seriously,” veterinarian Guillermo Berra, who led the first research group on the subject at the governmental National Institute of Agricultural Technology (INTA), told IPS."The aim must be to improve the productivity of livestock systems. The weaning rate, which reflects the proportion of cows that produce the ideal of one calf per year that is ready to be fattened, is 60 percent, compared to 85 percent in the United States. Improving that rate would mean producing more meat with the same emissions." -- Sebastián Galbusera

“The intensification of production processes through feedlots has improved yields lately and has therefore contributed to reducing GHG emissions, but it has generated another problem, which is soil and groundwater pollution,” he explained.

According to the latest National GHG Inventory, which Argentina submitted last year to the United Nations Framework Convention on Climate Change (UNFCCC), agriculture and livestock raising, including deforestation, generates 39 percent of total emissions.

A significant detail emerges from the data: livestock farming is the subsector with the highest emissions, ahead of transport, emitting 76.41 million tons of carbon dioxide (CO2) equivalent per year, which represents 20.7 percent of the total.

‘Enteric fermentation’, which refers to the methane that cattle release into the atmosphere as a result of their normal digestion process, is the main source.

Sebastián Galbusera, who teaches environmental economics at the ‘Tres de Febrero’ National University, told IPS that “these results should come as no surprise in a country where farming is key. But they show us the complexity of the challenge of reducing emissions.”

“The aim must be to improve the productivity of livestock systems. The weaning rate, which reflects the proportion of cows that produce the ideal of one calf per year that is ready to be fattened, is 60 percent, compared to 85 percent in the United States. Improving that rate would mean producing more meat with the same emissions,” he added.

Argentina was the world’s largest exporter of beef at the beginning of the 20th century. However, in recent decades, livestock farming has not experienced the same technological development as agriculture, which has gained ground and relegated it to feedlots or marginal areas.

Osvaldo Barsky, a researcher on rural history in Argentina, told IPS that “with the incorporation of technologies and varieties, agriculture expanded to the best lands.”

“In livestock farming, the processes were slower and there were even times of decline, such as when President Néstor Kirchner (2003-2007) temporarily banned exports to curb the growth of domestic prices,” he said.

Livestock farming is responsible for the highest greenhouse gas emissions in Argentina, ahead of transport, emitting 76.41 million tons of carbon dioxide equivalent per year, which is 20.7 percent of the total. Credit: Courtesy of Ana Garcia

As a result, “there was a major drop in production, 10 million head of cattle were lost and neighbours like Uruguay and Paraguay overtook us in the international market,” said Barsky. Meanwhile, Brazil has become the world’s largest exporter of beef and poultry in the last two years.

Today, beef is one of the few sectors of economic activity where the government of Mauricio Macri, in office since December 2015, can show favourable figures.

Macri himself, in fact, led the bimonthly meeting of the National Beef Board, which brings together various state and private stakeholders, on Jul. 16.

According to official data, in the first five months of this year Argentina exported 60 percent more beef than in the same period in 2017: 121,277 tons against 75,934.

Government projections released on Jul. 19 indicate that the country will export 435,000 tons of beef this year, surpassing Uruguay and Paraguay for the first time in years, although still far behind Brazil, which will export some two million tons.

Currently, half of Argentina’s beef exports go to China, followed by Russia, Chile, Israel and Germany in that order.

Exports reached 1.2 billion dollars in 2017 and the government hopes they will bring in nearly two billion dollars this year.

Production is also growing, albeit at a slower pace.

Average domestic consumption of beef in this country of 44 million people, which at one point reached an average of 80 kg per person per year, fell due to competition from other kinds of meat, but is still high: 59 kg, according to updated figures from the Argentine Beef Promotion Institute (IPCVA).

Berra warns that “If we want to continue exporting in the long term, livestock production must not only be economically efficient but also environmentally sustainable and socially responsible.”

“Argentina, in the future, could be at a commercial disadvantage if environmental trade barriers are implemented,” he added.

In this sense, feedlots play a fundamental role. Extensive livestock farming and its pastoral image of cows grazing in open fields is becoming less and less common.

Feedlots, which began to be used in Argentina in the 1990s, allow for intensive meat production in less time and with less space.

Currently, 65 to 70 percent of the cattle that arrive at slaughterhouses in Argentina come from feedlots, Fernando Storni, general manager of the Argentine Feedlot Chamber, told IPS.

“This production method in Argentina is relatively new and regulations are still being designed. The disposal of livestock waste is only regulated in one province (Córdoba),” he added.

Storni said that “we are aware that we have to work on mitigating the impacts because the requirements are going to be increasingly strict at the international level.”

The issue is being followed with concern by researchers from the School of Agronomy of the University of Buenos Aires (UBA).

Ana García, who holds a PhD in Agricultural and Forestry Research and is a researcher at the UBA School of Agronomy, said that “it is urgent to regulate these activities because they have a negative impact on the environment and can affect human health.”

“I have been studying feedlots since 2004 and I see that there is no adequate treatment or final destination for problems that accumulate over the years. There is a lack of synchronisation of the production system with environmental criteria. You have to help producers to set criteria before you can demand it,” said Ileana Ciapparelli, a professor of Inorganic Chemistry at UBA.

She explained that “producers don’t know how to dispose of the feedlot solid waste and do what they can. Some use it to try to improve soil fertility but others leave it in piles, generating a source of methane emissions.”

Ciapparelli carried out a study that showed that hundreds of tons of manure deposited in clay soil generate concentrations of substances that can penetrate the soil up to more than a metre deep and contaminate groundwater, which in turn is connected to surface water bodies.

One of these substances is phosphorus, a nutrient that agricultural producers buy through fertilisers and that could be obtained from the waste from feedlots, which today contaminate watercourses.

“The big picture is that the CDM is at a crossroads. The markets have collapsed” – Hugh Sealy, CDM Executive Board Chair. Credit: Wambi Michael/IPS

By Wambi Michael
LIMA, Dec 4 2014 (IPS)

The U.N. mechanism for supporting carbon emissions projects in developing countries – the Clean Development Mechanism (CDM) – is in crisis as a result of a dramatic slump in the prices being paid for carbon credits.

The CDM, which deals in Certified Emission Reductions (CERs), is faced with possible collapse because demand in recent years from the principal buyers – countries tasked with emission reduction obligations under the Kyoto Protocol – has dropped, because emission reduction targets have not risen significantly and because economic growth has slowed. “The mechanism [Clean Development Mechanism] has so far led to the registration of 7,800 projects and programmes across 107 developing countries with hundreds of billions of dollars in investment, resulting in 1.5 billion fewer tonnes of greenhouse gases entering the atmosphere” – Hugh Sealy, CDM Executive Board Chair

The CDM Executive Board and its members at the ongoing (Dec. 1-12) U.N. Climate Change Conference in Lima, Peru, have been trying to convince negotiators there to renew their commitment to the mechanism, which has existed for the last ten years. Hugh Sealy, Chair of the CDM, answered questions from IPS on what has gone wrong and what needs to be done.

Q:  Can you give us the big picture of the Clean Development Mechanism today?

A:  The big picture is that the CDM is at a crossroads. The markets have collapsed. The price of CERs has fallen to about 0.30 a dollar compared with over 30 dollars five years ago.

Q:  What has been achieved so far?

A:  The mechanism has so far led to the registration of 7,800 projects and programmes across 107 developing countries with hundreds of billions of dollars in investment, resulting in 1.5 billion fewer tonnes of greenhouse  gases entering the atmosphere.

Q:  Where was the problem for the CDM?

A:  The beginning of the trouble for the CDM – and this is my personal feeling – was the European Union’s 2009 directive [to strictly limit the permissibility of international credits and ban them altogether from 2020] which came into effect on Jan. 1, 2013. You have a situation where you have one buyer – the European Union. Japan has decided to create its own system, the JCR, Australia has gone its own way, Canada has gone its own way, and the United States has never bothered either. So if you have system where the European Union as our major buyer is going to exclude all other units, then the market is not going to take a lot of them. And that is when the prices begin to drop.

Q:  So you think you should have had a regulated market for CERs?

A:  A market for CERs, which are not like any other commodity, should have had a floor. While others had a floor for theirs, we never had a floor on ours.  Yet now the World Bank is saying that we should create some sort of market reserve fund that can suck all this excess credit. They say about three billion dollars may be required to suck up this excess. And I don’t see it as a problem of excess CERs. I see it as lack of demand for CERs. I mean, look at all the CERs that we have generated. We have 1.5 gigatonnes of emission reductions. The emissions gap is 10 gigatonnes per year. So to me, the essential and radical demand remains for a market system.

Q:  The CDM Executive board has been fronting voluntary cancelling as a possible option for creating demand for CERS. What is the idea behind that?

A:  The idea is that anyone. Even you as the media, me as an individual, a company, a government can purchase and cancel CERs immediately. But we have no idea what demand we will have for voluntary cancellation. So I cannot tell you that as a result of voluntary cancellation we will see an immediate upsurge in the price of CERs. But we as a board think this is the right thing to do. To make CERs available to anyone who wants to reduce their carbon footprint.

The other thing that we are looking at is what services we provide. And we believe we have a very robust Monitoring, Reporting and Verification (MRV) system for determining actual emission reductions.

And what we see is that a number of financial institutions like the World Bank, the Global Environmental Facility and the Green Climate Fund are allocating quite a bit of their portfolios to what they call performance-based finance or result-based finance. And we are in dialogue with these institutions asking them to use the CDM, use the MRV that we provide, to ensure that the CERs that you put your loans out for are actually achieved.

Q:  That may not take off and possibly is not sustainable. What would be the lasting solution?

A:  We need a clear decision here in Lima, and Paris [in 2015] in particular, as to what the role of an international offset mechanism will be in a new climate regime. We need parties, particularly the developed countries, to raise their level of ambition and to create more demand for CERs. And outside that, we are searching for non-traditional markets through voluntary cancellation.

Q:  What are the implications of this development for least developing countries and least developed small island states?

A:  If I was a developer, and I’m from one of those countries, I would hold on to my CERs. I would not seek to enter a purchase agreement at this time. Not at thirty cents. I’m an optimist. I believe the price of CERs must go up.

There is a fundamental arithmetic that I’m working with and that is that the emissions gap is about ten gigatonnes per year and is only getting wider at this point.  So if countries decide that markets will be vital component of the Paris agreement, then I cannot see how the price of CERs can remain at thirty cents. It can only go up. It is absolutely frustrating for small island states like Jamaica that already have registered CER projects. It is extremely frustrating for countries in Africa.

Q:  If the CDM was to collapse today, what would we lose?

A:  We would lose ten years of experience, ten years of learning by doing. Those who think that they can abandon the CDM and create a new market mechanism in the interim are not facing reality.

It took a very long time to create the CDM and to get it to the stage we are at now.  So my answer to your question is that we will lose quite a lot. I cannot give you a monetary number or a dollar value of what we will all lose in investment. There are over 4,500 organisations in the world that deal with the CDM.

Q:  What can be done by countries at the negotiations going on here in Peru if, in the past, such negotiations have produced a pioneering model like CDM that has to some extent worked as you seem to indicate?

A: They can increase their demand for CERs before 2020, recognise the value that the CDM can add to emerging emissions trading systems, and recognise the mechanism’s obvious value to the international response to climate change after the new agreement takes force in 2020.

This is one of the most effective instruments governments have created under the U.N. Climate Change Convention. It drives and encourages emission reductions, climate finance, technology transfer, capacity-building, sustainable development, and adaptation – everything that countries themselves are asking for from the new Paris agreement.

(Edited by Phil Harris)