Ask Me Anything Webinar Recording - June 4th

The third Ask Me Anything webinar was an opportunity for the Investing in Regenerative Agriculture and Food community to come together and ask Koen van Seijen and everyone else on the call their burning questions regarding building a regenerative food system.

Find the topics discussed and the links on:
www.investinginregenerativeagriculture.com/ama-webinar-6-4-2020/.

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Transcript

UNKNOWN 0:00

you

SPEAKER_01 0:02

And we're on. So welcome to the, I think we're at the third Ask Me Anything webinar on investing in regenerative agriculture and food. I see some new faces. I see some familiar faces. So for everyone, welcome and great that you're here. Please make sure you're muted when you're not talking, not asking your question. We had a number of people asking questions beforehand through email. So I will be going through them first. But first of all, I noticed the first time we did this, there were quite some questions on what is regenerative agriculture, how is it defined, et cetera. So I prepared a very brief presentation for anybody that's already deep in the space. Sorry to go through that again. This won't be new to you, but for anybody that's completely new, I think it helps to set the stage of where we are. So I will be sharing my screen for just a second. We'll take a few minutes and then we'll get straight into the questions you have shared before. Obviously, there's a lot of space for people to ask questions. beforehand, but we have definitely space. So just very briefly, this is the Ask Me Anything webinar. As you know, we are on Thursday. For those who signed up through other channels, LinkedIn, et cetera, I'm Koen van Zijen. I'm the host of the podcast, Investing in Regenerative Agriculture and Food, which we've been running since 2016. I've been very interested in region ag since 2011, and basically I've been trying to follow the space and figuring out how to put money to work which makes sense for soil farmer investor and obviously ecosystem meaning all of us so we've done a lot of interviews some longer some shorter we're releasing now actually since the last ask me anything webinar we're releasing one a week at the moment why very simply there are too many interesting stories to tell there are too many people which is great it's a great problem to have too many people building interesting things fund managers entrepreneurial farmers investors scientists and we see the uptake also in terms of listening numbers and so we're trying to accommodate to that there's just there's too much to share at the moment so that's which is a great and amazing problem to have and thank you all for for definitely for listening in and sharing the podcast we see that happening a lot and you can find it if you haven't subscribed yet on any of your favorite podcast app or apps depending where you're listening if you cannot find it please let us know but we are in most of the the main ones and you can see quite some summaries tech summaries etc on our website, which is investinginregenerativeagriculture.com. So what is regenerative agriculture? Which is a question we obviously get asked a lot. So it's a system of farming principles, and we'll get into that in a second, and practices that increase biodiversity, enriches soils, improves watersheds, and enhances ecosystem services. This is just one of the many definitions. We're not going to spend an hour on if this is the right one or not, but I think it gives a good summary of at least what we're talking about. So it's not a set of tools, it's not a recipe that you can apply to any type of land, but it's a set of principles. And just to very briefly to show the difference, what is the difference between regenerative sustainable, between organic, et cetera? I think it comes down to the question, is it building soil or not? You can actually find organic farming operations that are very sustainable, you can find organic farming operations that are quite extractive, and you can find them that are regenerative. always like to ask the question, is it building soil or not? And I think most of agriculture in general at the moment is extractive. Some of it is sustainable and even smaller percentage of that is regenerative. So it's not a certification or at least not yet. Maybe we never get there. Maybe we don't want to. Separate discussion. But I think the central theme is, is it building soil or not? And I think that's a question you can ask if you're investing in this space. It's a question you can ask if you're buying from farmers that discussion around soil I think this is the central piece and it shows why it goes beyond sustainable. Just very briefly on the principles of region ag. Again, here we can probably have six or seven in some cases, but I see these four being used very often, which is covering the soil. Soil should never be, or at least amount possible, uncovered. There should always be growing something. I like to compare it to a solar entrepreneur. I think to see farmers as solar entrepreneurs, meaning they try to convert as much sunlight as possible into something useful. And that could be sugars for the soil, it could be a crop for us, it could be a cover crop, etc. And that also shows that if a soil is bare and is basically naked for six months a year, you're losing the sunlight for six months a year. So you see regenerative farmers really going into a lot of effort to make sure they have as much service as possible, as many leaves, as many different plants to cover the soil and to absorb that sunlight. That gets into the second point, complex rotations in place and time. No monocultures are very So basically on the same year growing multiple crops in the same field and also year after year doing very complex rotations. Sometimes I've seen farmers doing 10, 15 years, very different crops in the basically year after year. That obviously requires a lot of planning and figuring out in terms of harvesting as well. Very limited tilling or no tilling and soil disturbance, which means the big trackers with the big tilling plowing equipment you see are something probably that they will park the first second so the first usually david montgomery one of the writers in the space starts with please leave the plow or stop plowing which is of course a shock to most farmers because we've been taught that plowing is the basis of of a lot of things or at least the basis of the season then the fourth there's a lot of discussion around it but you see a lot of advanced regenerative farmers integrating animals at some point in the rotation we discussed before so there could be different types of animals could be beef or livestock it could be a lot of different ways but you see at some point there's a role of animals to build soil. There are very few examples where that's not the case. It doesn't mean it's not there, but there seems to be a role of animals to build soil at least faster than without. And I think if you want to dive deeper there, obviously the podcasts you can take, there are a lot of books. These ones I find very interesting, Growing a Revolution of David Montgomery, which I mentioned before, Kiss the Ground. Both the organization and the book, honestly, they do a lot of good work. Dirt to Soil, very personal. personal story of a farmer, Gabe Brown, on YouTube. Richard Perkins, definitely interesting. And there are many other channels. And also Judith Swartz, who actually wrote some great books on the topic. And with that, I think we did a good introduction to the topic. And I would like to start with the first questions, which actually came from Lenny. And I will copy them into the chat. expand on them a bit, Lenny, if you want to. But let me put them in the chat first. So the first one wasn't really a question actually, it was more a statement.

SPEAKER_00 7:19

Can

SPEAKER_01 7:28

you type them actually, because somehow my... do you have them at hand lenny because somehow my copy paste is refusing to cooperate Maybe it was too much, sorry. It was too much, yeah. So your first question was too long, but I can summarize it. So basically you were asking on the organic matter as a good KPI, but your main point, I think there is, but please elaborate on that, that there's not really a clear, let's say clear consensus yet of how to measure it, where to measure it. And you were basically asking for a group of expert or academia and professional backgrounds to come together and compare it different projects is that correct or you want to exactly

SPEAKER_02 8:21

yeah i mean we always talk about organic matter content as a good kpi but for me it's really important to also analyze others to have other kpis on to measure the impact of generative agriculture do we have social and environmental impact to measure the farm generative farm so i think it's it's really important to work together and try to find out others KPI to measure the impact of different projects.

SPEAKER_01 9:28

And just to give a bit of background, Lenny works at 123, which I interviewed a month and a half ago, maybe Oliver, on large scale agroforestry projects, mostly in central and middle and South America. So they are obviously, I mean, soil health is relevant, but social is just as everywhere, extremely relevant as well. Yeah, I don't, I mean, I wish I knew an easy answer for that. I think I hear soil health and or soil organic matter as a good proxy for a lot of things, but definitely not the perfect answer. And in the impact investing space and just putting on my other hats there, it's extremely difficult to measure anything social, obviously. And there's not an easy answer to how do you measure the positive impact beyond, okay, this forest is growing or the soil is growing of this forest project, what is the positive impact in the larger community, the larger watershed it's in, the larger interaction with the nearby city, et cetera, et cetera. And I think actually your impact report is doing a very interesting try in that. And I know you're working very hard on it, but you're not satisfied with the results so far. You want to do more. So I think it would be good to, if we've seen examples, I think that's the best thing for the investors in the space and the people in this space, especially in agroforestry. If you've seen examples of good impact measurements and metrics for maybe specifically agroforestry, it would be great if you can put that in the chat or reach out to me after. I can send them to Lenny. I don't have an easy answer for that. On your second question, what about the 10% a year which a lot of institutional investors return? We're talking about return here, financial return. A lot of institutional investors, and you have a very large institutional investor on board, are expecting. I think from what I've seen now, it's definitely possible to do good returns, and I'm saying good here with a reason, in regenerative agriculture. But there is a debt to pay as well in the sense that we've been extractive for so long that the more you take out, obviously, the earlier, the longer it takes for a system to recover or to become, let's say, very alive and for a soil to become very alive or a forest. If you buy a very degraded forest project, it takes a while before that comes back to life. I think it depends what you need. If you need liquidity and return fast, in some cases you can, but it probably hurts the speed of your regeneration and it probably hurts the length as well. If you don't have to take returns for 10 years, obviously you have a lot more flexibility to do. And I remember one of the quotes of Sally Calhoun, who was an investor I had on the podcast or is an investor a long time ago. And actually she came back with Esther Park for the series with Transition Finance. And she said, I'm convinced we can do double-digit returns in regenerative agriculture. It's just that we've been using extractive agriculture for so long that we don't know how deep the J curve is and we don't know how long it's gonna be. So we have quite a big debt to pay in terms of soil organic matter, in terms of social, in terms of many, many other places in our land use. And so maybe in some projects it's possible to do an easy 10%, but I mean, you're taking biomass out of a system because you have to pay for the returns. which means that it's gonna slow down something or maybe even hurt something in the long run. So it really depends on what we need. And I think there's a lot of education there needed to investors. And we as a space should probably do a lot of that. Like it takes time. It takes time to restore a degraded landscape. And there are returns in biomass, in non-financial return. There are a lot of ways to do the accounting here, obviously. And we should. But if somebody promised you a 20% return in regenerative agriculture, I would ask a lot of questions about that because it means something is losing out, I think. And so it's an education piece we definitely need to do in terms of flexibility because there could be bad years in terms of time. And something that comes back in a lot of discussions in the podcast, time, time, time. This takes time. Things can move very quickly, but the best things happen over time. And then you had a final question. How do we go from small scale to large scale? And do we lose something when we do that, basically, to scale up? I think that's the summary. I think we're at exactly that point. We see amazing small scale examples in agroforestry. I mean, where you're at in grain operations, relatively big, but still small in many other places. how do we get that to 10, 20, 50 times the scale? And I think it's more about repeatability than scalability. But are we losing something there? Do we need new machinery? Are we losing the attention? If somebody does a one hectare permaculture garden, obviously he or she has the attention to almost see every single plant every day if they wanted to. If you do a 20 hectare, you start to lose that, but you have a lot more impact in terms of water, in terms of climate, et cetera. So I think we're in exactly the tension. I don't know yet. My feeling is we lose something when we scale and repeat. But I haven't seen amazing data on that yet. I haven't seen centropic farming done on huge scale and to compare that to 10 smaller projects. I don't know. I think permaculture is at that space where they're starting to think about scale. I think we're at a lot of relatively small scale examples and we're now getting that phase of, okay, what does it mean to do this 10 times or 20 times or 100 times or maybe 100,000 times? And that's going to be a discovery. So I don't know if the agroforestry space is maybe more developed because obviously you're involved in very big ones, but still small compared to some of your other players maybe. So do you feel like you're losing something when the scale happens, Lenny? Sorry to put you on the spot.

SPEAKER_02 15:26

Yeah, I mean, our agroforestry systems are not so complex as the traditional ones from the small farmers. But it's always a balance between complexity and large scale agroforestry systems. You have to find a balance between complexity and large scale. Yeah.

SPEAKER_01 15:47

No, absolutely. And just to, okay, I see another question. I will go back to some of the questions we had before, but I will try to answer a few in the chat now. Franciane, you're asking on the current restraints to that kind of design, which kind of design are you referring to? You're on unmute.

SPEAKER_04 16:22

It was a comment on the question, actually. The question is, how can we scale up? So I wonder, what is the difficulty there?

SPEAKER_01 16:33

In terms of agroforestry systems, I think.

SPEAKER_04 16:38

Yeah.

SPEAKER_01 16:40

I think the difficulty, I don't know the difficulty at the moment in terms of scaling up. What's your pain point? I mean, is

SPEAKER_04 16:49

the limitation, is it real? Do we know that? Or is it an assumption that it's going to be hard?

SPEAKER_02 16:56

I mean, we have to find markets for different products. So we have to find a market and it's always difficult to sell different products. And I mean, for me, it's a lot about knowledge. We need to know a lot about each crop to be able to be resilient and to be profitable. So for me, it's a lot about knowledge and it's difficult to find markets for different local products. local native trees in the agroforestry systems.

SPEAKER_01 17:33

Yeah, aside from the cacao and the main product or the cash crop in the system, just between buckets.

SPEAKER_04 17:39

Because that changes your question quite a bit already, I think.

SPEAKER_01 17:44

It makes the... I think it comes back to an interesting point that also keeps coming back. How do you buy the whole rotation? In this case, obviously, it's not a rotation. It's the whole system. But it's sort of the same. How do we not just focus on the one type of grain or the one, in this case, the cacao and the one? And there are... I mean, Dan Barber writes about it and obviously did it in his restaurant, so it's now closed. But that's a strong question, like how do you buy the cover crops or how do you market the other ones, the not fancy ones, in a system to a scale or to a size that you can market? Obviously, it depends if you're selling directly to the end consumer or you have to go through a very complex value chain like with cacao that ends up somewhere in a chocolate bar in North America or somewhere else. But how do we buy the whole rotation or the whole the crops that come out of a system that are marketable, obviously. That's a pretty good question. I see a comment of Wilhelmina. CSAs don't need a 10% return. Obviously, that's true. At the moment, you change the ownership structure and return becomes a different thing because maybe the land doesn't need to exit or the system on top just needs to provide the food, in this case, as a CSA, and you get a whole different discussion. In this case, it was specifically on large institutional investors that start to become more interested in this space, but have obviously different requirements and maybe they need to change. Probably they need to change partly and maybe the sector partly, like the truth might be somewhere in the middle. Franciane, we need more people on the land. Absolutely. I think which is what we see in any advanced regenerative farm. There's more hands needed, which is not necessarily a bad thing. And in many of the systems they are luckily better paid and sometimes well paid compared to the current agriculture system and I will just put in the next set of questions And I will go back to the other ones, but I want to make sure we get to the ones that Tom actually sent. I don't know if Tom's online because I cannot see everybody. Let me just quickly screen. I don't think he is. He asked some very specific questions, which I don't know if anybody in the audience knows, but is anybody tracking the growth of regenerative agriculture globally? Like how many hectares or acres under management? Is anybody measuring that in terms of maybe through satellite, et cetera, because he's involved with the project. He heads the EPIC Institute in the US. And they are involved. They're trying to figure out, can we see how big it is at the moment, how big it could be, or what is the growth year over year? What are we talking about? We hear a lot of buzz. But at the end of the day, it's about hectares and acres that are changing. And I don't know. They are looking at some satellite solutions, which are quite costly. And I suggested, I mean, there's obviously more data on the organic agriculture sector, which is definitely not by all means regenerative, but at least it shows some steps in some directions. But also there, there's very little data, or at least for what I know. And he also asked me, you can see the second question, or the third question, what are the country's best positioned or in pole position at the moment that are basically growing or having proper policies in place, etc. I don't know if anybody, maybe Stephanie actually, Stephanie raises on the knows of anybody that is tracking the growth of this sector, which would be great. I mean, I think as a sector, we would all like to see like, okay, wow, Spain is really doing amazing things because they grew the hectares on the management. We have some ideas of no-till, but as we all know, that's nearly not enough. Ah, Stephanie is tracking it. It's a long answer. Okay. Maybe you can share it and I can share it in the follow-up and we put it on the website where we host it. Perfect. I will get in touch with you, Stephanie. And so that's Tom. Those were Tom's questions. I would just make sure we go back and I don't miss anyone. Indigenous lands, Karen, that mirror the scale. What do you mean by mirror in this case? of seeing if I see Karen.

SPEAKER_05 22:09

Sorry, it was just a comment in terms of that scale up, is that in some landscapes where you've had a long history of indigenous peoples on their management systems, they're, depending upon the system, they're working within a regenerative capacity over the last few years. Well, several years they've gone into more intensification. And therefore you can, that's as near to scale up, I think, on the regenerative that we might have that will give us the level of insight. And I think it also goes back, I don't know, to the kind of monitoring. It's very interesting. It's very diverse, but it's also quite difficult to differentiate from satellite imagery, unless you're looking at LIDAR and high resolution stuff, to be able to differentiate kind of of regenerative agriculture and kind of, you know, your agroforestry system to your secondary forest, to your kind of semi indigenous kind of traditional land use system. So, and as long as you're kind of incorporating all of that complexity into it, it makes it very hard to know what your starting point was.

SPEAKER_01 23:35

Yeah, of course. I mean, what is, what was the starting point? what is time zero when we start to discover more and more. We've been managing, we as humanity have been managing a lot of landscapes for way longer than we thought. And we don't know what wild, and we're probably part of the wild part anyway. We don't know what wild would look like, does look like. We don't have a comparison to, I don't know, the origin of the T zero is very difficult. Plus we have no, I mean, we don't have an easy way to distinguish this is regenerative or not, like you said. I mean, it's easy to track no-till probably from space because you can see it's a barren or not. But yeah, it gets way more complex. But I'm going to follow up with Stephanie to see what they are tracking and how they're tracking it. Thank you for that. And I just want to make sure I don't skip any other. Your book, yeah, I would definitely share, Rosalie, I would definitely share the book recommendations and the link. And I will, after this webinar, we put the recording online and basically I will go through all the comments and make sure they are all there, plus some extra interviews, et cetera, that link or that we have discussed or that might make sense. Strip cropping, Wilhelmina, which is actually a good point because we have another question about that. One second, Diego, because you're typing and I'm gonna... put another question of somebody that shared actually tim that shared the question before um How do you look at strip cropping for arable farms? The yield biodiversity impacts are positive. What is stopping implementation at scale? I don't know. I think that's the first. I haven't looked deep into strip cropping. I mean, I think it comes back to the same question. Why is regenerative agriculture in general not scaling everywhere so fast? Because you see, in many cases, very successful farmers doing it doesn't mean it's easy and their neighbors not. It always baffles me. Why? on the left side of the fence line, it's all green and on the right, it's not. I think it's a very complex question. There's a lot of peer pressure. We all have created a system, an agriculture system that's definitely not regenerative and extractive. And for most farmers, they are, I wouldn't say stuck, but they're in a system that doesn't get them to the regenerative part at all. And I don't think we can blame it on them. I think we can blame it on all of us that have played our part in that, either by buying the crop insurance the subsidies, et cetera, et cetera. But that's why I'm very interested in the transition finance piece. Like how do we get farmers? And it's not necessarily about the money, about the capital, but it's also about the support, the peer support. People need to see, because farmers have 40 harvests usually in their lifetime. And why would they gamble two or three or four, maybe even five? That's a lot to gamble, especially with the margins that we have at the moment. So that's why the peer support is so crucial. The expert support, independent economic support, agronomic advice, which is something Soil Capital is working on a lot. Like how do you make sure that the advisor that comes on the farm is not selling the same chemicals? Because obviously then the advisor will sell you more of the same chemicals, which is logical. That's his or her incentive. But the best advisors you can get at the moment are Syngenta. Why? Because they're for free and they're the best paid by Syngenta. So there's a lot to unpack there and it's not just, okay, it's more profitable. Why is not everybody changing? And I think, I don't know all the details obviously on StripCorp, but I think it has to do with like, it needs a 360 approach. It needs to farmer needs support from peers. A farmer needs support from independent experts. A farmer need access to markets. We need all of us willing to buy produce during the transition after the transition and have a guarantee for that. They need access to carbon markets, biodiversity markets, water markets. We've, we've talked about that before and, and then access to capital. But I think it's the third in, in access to, to experts and, and peer support, access to markets is probably more important than access to capital. And that if we get those systems in place, well, we can help a lot more farmers that want to go through the transition and really partner with them. I think that's key there as well. And I think in the strip cropping, that is the same as many other management changes because that's at the end what we're doing. Where does automation fit in transition towards regenerative agriculture? Really good question. I think there's a huge role for a lot of the tech we see, a lot of the fancy tech, the robots, the drones, the self-driving tractors, et cetera, but always with an angle of how does it build soil or how does it enable farmers to build soil? And I would urge any investor in the space to always ask that question to any fancy ag tech company that you see because you'll be surprised by the answer. There are definitely interesting companies out there, but very few are really connected to the farming reality actually they're very interesting companies out there because farmers started to build things because most farmers are very let's say very close to an inventor and they figure out a lot of direct seeders harvesters etc because they need things and the big companies are building them so I would actually go as close to the farmer as possible and see what's the real need there but I think there's going to be not only a lot more hands needed on the farm like we said before but also a lot of interesting approaches of technology that we just have haven't figured out yet. Both in agroforestry, actually, there's going to be a lot of development in syntropic. Maybe that answers some of the scale questions. Probably not all. As always, technology is a tool, just like finance. So that's going to be... It's going to be very interesting to see, but always with the question, does it enable the farmer to build soil faster? And I think if yes, very interesting. If not... I personally wouldn't be so interested in it. The labor shortages due to corona, I hear very mixed stories there. I think that the large monoculture farms, I mean, Italy now, in the Netherlands, the issues are there. I think in the UK as well, many European countries are facing the labor shortages. If you look at the regenerative mixed farms, in many cases, they have a year-round work, and they have a different relationship with their labor, so that's a different issue If you have, let's say, just a huge tomato operation and you need to harvest the tomatoes in those four or five weeks or whatever the time is, you're going to have a lot of issues this year. So there's going to be a lot of tension, I think, this summer around labor shortages, pushing people or asking people more hands to come back to the farm. But it's also the type of work that we obviously didn't want to do anymore. And that's why we have labor shortages. And that's why we tried to get illegal immigrants to do it under horrible circumstances. So I think this summer we're going to see, at least in Europe, a lot of hopefully attention for that and hopefully also the attention for the other side. Like if you have a regenerative mixed farm, the labor part is very different or should be very different and should be much more around the clock the whole year and not five, six weeks of basically, I mean, we can say it's slavery, tomato picking. And I think we're gonna see a lot of scandal articles, et cetera. We saw that last year, but this year the spotlight is just gonna be a lot stronger and a lot of approaches to try to get people that lost job due to corona to to obviously help out and there's going to be tension there as well because we're not used to very very hard physical labor which which disease in large monoculture very obviously chemical intensive so it's it's not a not at all a fun place obviously to to work and we're going to see that for the first time because it's going to be in the news and it's going to be in a lot of places that normal people uh like in the supermarkets etc so i think it's a huge huge thing especially i don't know the u.s situation that but I imagine it's not very different. Yeah, the fragility of the food system became very apparent in this crisis and it's not done yet. It will be over summer as a lot of crops need to be harvested. The desire for shortened supply chains, absolutely. I see that exploding everywhere. Anybody that's selling directly to consumers will probably have witnessed that with, I have heard stories of a thousand people on the waiting list, a boom that we've never seen in the shorter supply chain. At the same time, obviously, people that sell or sold directly to restaurants and anything, hotels, et cetera, that market disappeared overnight. So it creates enormous tension for those farmers and for the others, it creates a basically. And for the processors as well, the small scale butchers in the US are already sold out until the end of the year. The large scales are all closing down because of Corona. So there's this huge divide suddenly between the markets and it creates a situation we've never seen basically before. But for the, for people that are selling, I say real food, real food to real people, this is a moment where they do three year growth plan in three weeks and probably faster. And how much of that is going to stay? I don't know, but I've heard stories of people saying 10, 20% of this is already more than enough to sell out for a while. And so it's, it's, it's creating a lot of opportunities and tension. I think that's the, the main one there. Martin is asking a question. I'm doing a project now for Avebe, which is a large potato factory, I think, in the Netherlands. Have you seen any regenerative potatoes farmers? And yes. And if yes, how do they farm regeneratively? And the first part to the question is yes. And there's one in the Netherlands called Jeroen Klompen, which I will put in the show notes after. How they farm exactly regeneratively? I mean, there's a tension there between tillage and potatoes because you have to plant them underneath the soil. How they do it exactly I would refer to them to explain their system. I hear, I think you came, where is Marta? Or not, somebody unmuted. But anyway, so I will put it in the show notes. So there's also there, even with the harder crops, because you have to somehow disturb the soil at least a bit. And there's definitely work being done on onions and tomatoes, on potatoes and more. A question, François is asking, when we talked about two years ago, maybe it's even more actually, are investors interested in research, the practical, of course, which is also a kind of investment. You're absolutely right. I think the short answer is yes, but it really depends how you ask. I just released an interview with John Lundgren, who is or used to be one of the main scientists of the USDA in the US, left there because of a lot of discussion around chemicals and insects that he wanted to publish and they didn't, and set up his own farm and a research facility. And he said, I'm surprised how many private individuals are supporting our research and while we run a commercial farm as well. So he said every academic first has to, in the field of agriculture, first has to become a farmer, and then we can talk about academia. And he is, I don't know exactly where he gets his funding from, but there are a number of foundations supporting their private individuals. And he was surprised how, I wouldn't say easy, but how he could get a number of his research pieces, which are mostly focused on the profitability, the connection profitability and RegeneG, and how to get that funding. And these are multimillion dollar projects. They're not huge, but they're also not small. And he has got funded for quite a few, but both by public programs, but also by private individuals. So there is some, at least in the US, very specific, obviously, but there's some interest, especially from let's say the foundation part or the investors that are taking a full portfolio approach and are also including their grants in their approach. And one research piece on profitability and RegenEgg is elements can change an element industry in California enormously. And maybe that research piece costs one and a half million. That's a lot of impact you can have with a relatively small amount, obviously relative for depending on your size of your wallet. So there is some interest, but it really depends how you structure it and how you ask and obviously to whom and which connections. And he's obviously well connected in the US, but he sounded surprised how he could actually fund some of of the research that he used to be doing with public money in the USDA and now was doing on a commercial, his own commercial farm. Rosalie is asking, do I know any countries in Europe that give subsidies to regenerative farming and or foresting? I don't know. I deliberately chose to not go too much in policy and subsidies so far because it's very context and country specific, which means that a lot of the listeners cannot relate to it. So I haven't been following it a lot. I know the EU is working on the farm to fork strategy and the biodiversity strategy, but I don't know the details. of it. So I will definitely put them in the show notes below as well. I don't know specific countries that are actively supporting, let's say regenerative. I know some regions are supporting organic, but actively on soil. I think maybe Switzerland is doing something, but I don't know if that's it. And I see a response from Franz Jan. Thank you to Lenny. We need a lot more pilots. Absolutely. I think there's an interesting spillover effect. Oh, she's actually not. I'll answer that when she's back. The contact info. Yes, I will send that to you. You mean, I think of John Lindgren. Absolutely. I interviewed him and I will put both the interview, the website of the foundation and the website of the farm. Very interesting guy. Very nice guy as well. And interesting that he says by far the most interesting things happening now are happening on forward-thinking, very regenerative farms and farmers, actually, way more advanced than all the university staff I saw as a researcher. So it's actually, we need as researchers, obviously, to get out of the university, get out of our pilot farms because they're not representing the reality. And they're doing things, these farmers are doing things that we didn't believe, we don't believe that are possible in academia, which is very interesting. So the movement is so advanced that the farmers are way more advanced than the academia and academia is trying to catch up And obviously it's very difficult because this type of research is very, very difficult because they're very complex, holistic systems. So I really enjoyed that discussion because he left part of academia for that because he couldn't research the pieces he wanted to research and research the farmers. So they basically did a big piece on grain, which is one of the only studies I could find on profitability and regenerative agriculture. And what they did is they found the most regenerative ones and compared them to their neighbors. Very simple, but nobody had done that before and they now did the same or are doing the same in almonds and in rangeland so in livestock but i will put them in the so we don't mean just to answer to and it's it's not really a question but we need a lot more pilots to show farmers the benefits of region egg i think absolutely true you see this very nice spillover effect there's actually a study in the u.s on organic farming when one organic farm starts in a community you can see a number of years later that there are multiple around like you usually see this spillover or this oil, basically it's spreading. And that's because we need to see as humans that it works with the neighbor. We need to see that he or she doesn't fail, it doesn't go bankrupt, et cetera. And I think every other pilot, and you see that I had a discussion with the Perennial Fund, who is setting up a transition finance facility for farmers, and they take that into account. So the farmers they pick, they try to pick the ones that are good communicators as well, that are well connected in their area and their neighborhood. They don't pick the superpowers. super gurus, which sometimes are not the best communicators in the space. And maybe in their community, they seem to be the weirdos. So they try to pick just the group behind that that are well connected, because if they are successful, they know it will spread through the community. So there's something very deliberate about where to put your energy in a community. And it really makes a difference depending on which farm goes first, basically, which farmer goes first and how he or she is communicating about it. Yono Proudfoot is asking, thank you, by the way, for showing up, Yono. I was on Yono's live Facebook. I think it was two, three days ago. It feels like ages, but it was Tuesday. We had a very nice discussion on region egg, also partly in South Africa. Are there any stamps or certifications available for regenerative? For at the moment, no. I think there are two parts to that answer. One is that Patagonia and Dr. Bronner's and Rodeo in the US are working on the regenerative organic certification. We can spend another hour on that if that's a good idea or not. But I'm very happy they're doing it, basically providing a plus on top of organic. So you have to be certified organic and they go a few steps beyond that in terms of looking at social and regenerative, so literally soil building. They're testing it now, piloting it around the world, not in Europe at the moment. And the first products are coming out with that label. So the short answer is actually yes, there are a few products. If that's the answer to everything, I don't know. Let's say the jury is still out. A second route to that question is that they're actually, in terms of livestock, and we've discussed that actually in the interview, there are some organizations taking a slightly different route to certification. They're not looking at the soil. They're not looking at if the farmer is regenerative because of the principles. In this case, I'm going to interview next week, the founders of Standard Soil, which already win the prize for the best name ever. But they released a beef brand where they looked at birds. Why? Because a lot more people care about birds than care about soil at the moment. And they found a very interesting correlation between ranchers that are very bird friendly, so that a huge diversity of birds and ranchers that were and are regenerative. And so they basically connected with a huge bird association in the certifying farmers to be bird friendly. And basically they picked the most regenerative farms out of there and started selling that beef as a very, very high premium one. So they circum, they went around the question of how do we measure soil carbon? How do they, they basically saw and see birds as a proxy and as a literally bird in a coal mine, obviously, because if there are no birds, the rancher cannot be regenerative. So that wasn't interesting. There's some people trying to, to go around that, that question. Um, I hope that answers your question. Oh, we went with the same, both in academia. Stephanie has some papers as well, which I will put in the show notes. Who has experience in the need for crop rotation? I think crop rotation is absolutely crucial or let's say complexity. Lenny was already mentioned that before as well. Complexity is very difficult to manage, obviously, but very crucial to soil. Biodiversity doesn't make it easier to harvest. I mean, if you're planting two or three types of grain, they're not ready at the same time. So you need completely different harvest equipment, but that also brings the inventor basically in farmers that I know. The rotation, I mean, I think you're asking for trouble if you're planting the same crop every year on the same piece of land because you make it very, very easy for anything to basically have a free dinner there. Can you list the trials that are going on in the show notes? Absolutely. I will... Can

SPEAKER_03 43:53

I break in on that?

SPEAKER_01 43:54

Yeah, of course.

SPEAKER_03 43:55

Because I have seen some studies that show that if you leave out the crop rotation, you have better results for crops.

SPEAKER_01 44:08

Results in profitability or in yield?

SPEAKER_03 44:12

Profitability and health because the crop has to make a relationship with the soil and that needs some time so if you rotate your crops every year you miss out of that experience of the soil and plant interaction and I've seen some studies it's about wheat that was kept on for four years on the same the same field and next to it there was another field with crop rotation in four years and the wheat in the non non-rotated

SPEAKER_01 44:56

yeah

SPEAKER_03 44:56

not rotated it was a lot better than on the other side I know someone who has his potatoes already for some 10 years on the same the same field and it's very profitable so maybe that's an idea to look at

SPEAKER_01 45:16

absolutely I think there's first of all there's a lot to discover I don't know many examples of long rotation of long non-rotations, but that doesn't mean it's not possible or not in a context specific or a site specific. It would be great if you can share the papers on that so I can put them in the show notes. You can also email me on that. You don't have to put it in the show notes.

SPEAKER_03 45:39

That would be great, yeah.

SPEAKER_01 45:43

And then let's see. I would definitely put that. I see Lenny responding to Francione. And then we actually... Very specific question from Danielle who asked, I don't know if anybody knows that. I'm looking for specific funds to invest in Massachusetts in the US. I thought it was the best place to ask it because we have a lot of people on the call, especially in managed grazing of cattle. So if anybody knows anything about that, think about it, but definitely let me know. Just ping me an email and I can get it in the show notes and send it to him as well. With that, I reached the end of the questions that were shared shared before, so I'm very happy to open it up for anybody that either wants to type or unmute themselves to ask something. And if not, oh, sorry, Diego, you're absolutely right. You were typing before and then I was coming back to that. Let me see. Ah, there we are. What do you think about the efficient use of agrochemicals recommended by the USDA not having the certification? How to know what the acceptable uses of fossil-based inputs? That's a very difficult question. I think, I mean, what the acceptable use is, I think that's a social question we need to ask society in general. I think what I see from the most advanced farmers I know is that they're going either, let's say, on a journey to zero, definitely not overnight because it obviously hurts your yields. Obviously, it really depends on the crop, where you are, et cetera. But if you have been using a lot of fossil-based inputs for a long time and you go cold turkey, you might be into some shocks. I see a lot of people at the end wanting to phase out everything for different reasons. I mean, we see more and more research coming out in terms of the health impact and that obviously the input companies are claiming that's not there. But actually we see a lot of research coming out now and don't be surprised over the next years to see a lot more of that, that it's not as safe as they claim. What's the optimal use? I don't know. It depends again on the place. I see discussing with Soil Capital, mostly Nicolas was on the webinar recent or was on the podcast recently. Most farmers, very conventional farmers overuse a lot and they are seeing mostly 30 plus percent, meaning that if you follow your non, if you follow your non-independent agronomic advisor, who's probably selling this stuff, you're probably overusing your cocktail anyway, even if you don't, if you're completely not interested in your regenerative agriculture, soil, et cetera. So there's a lot of space already there to reduce a lot. If you opt for your location, et cetera. Then you go to the John Lundgrens of this world where they say whatever the input companies have been selling, it's absolute nonsense. You can do without, et cetera, et cetera. The grain trials they did, the non, the farmers that use insecticides had 10 times more pests in their fields than the non ones. So you see very different, again, we're in a phase where we see a lot of claims that most of them sound too good to be true Maybe some are, maybe some are not. But you see a lot of different ways. I think all of these farmers are pushing for a very input light model. Some cases you might need some inputs for a while, but they're all in the transition that maybe in 10 or 15 years, a lot of the, at least the chemical fossil fuel based inputs are no longer necessary. And then it depends on the consumer, how fast they can go. Like if we want as consumers to go really fast, farmers can go really fast. If we can't and we don't want to pay or invest or spend money on that, then we're pushing them to just do it on the margins they have, which means the transition goes slower. So acceptable, it really depends. I see there's a lot of push for chemical free products, which I don't think is going to go away, especially in the health crisis we're in now. I mean, there's going to be a lot more attention for whatever we're spraying. And we, I say we, because we are all responsible for that. It's not something we pushed on farmers. It's not something we asked for, but it's something that's part of the system we've created. So I don't know... how efficient you can get and how much of the, even the efficient use of chemicals is still hurting the soil life, which is something you're trying to rebuild as an regenerative farmer. Probably in the transition, it can still play a role, but I would be very interested to see, okay, what, what, what is your long-term five, 10, 15 year plan and how can you get off very expensive inputs? Let's not forget most of the profit margin differences with a lot of these farmers come partly from the selling directly and partly from the inputs are very expensive and, and, coming from very far very resource intensive as well as you pointed out with your fossil fuel based ones was my position on um the whole system co2 balance carbon sequestration in origin and carbon emission like crops and meat traveling from South Africa, South America to Asia? That's a very good question. I think the shipping around the world, I mean, traveling depends how you travel, obviously, and how intense that is. Flying crops around the world seems to be, I mean, not very possible at the moment, but makes something very, very, very energy intensive. And I think that comes back to the input question as well, like how much input was necessary to get that calorie on your plate and how much of that simply wasn't like how much can we spend on that and probably there's going to be a lot of pressure from a lot of sectors to greatly reduce the amount of emissions and input they use and thus the emissions and food and agriculture shipping avocados around the world because we want that there's going to be a lot of discussion around that I think there's obviously a lot of potential for carbon sequestration we're not there yet in terms of measurement in many cases but the potential is there but I think the potential is maybe even bigger in water storage or maybe even bigger in biodiversity we focus a lot on carbon and the story is a lot bigger than carbon but it's easy to it's easy to communicate easy to measure easy to it should be easy to measure it's not but the question if South America can stay the big production hub of of soy meat etc I think has to do with a lot of different factors there's a very interesting report um came out of i'm thinking planet tracker um i interviewed mark and matt and they looked very simply at argentina and brazil can they actually they need a lot of dollars to serve their their loans they have with the imf and others they mostly paid through that through soy the soy industry is like this the soil underneath the soy industry is suffering a lot so where's the breaking point where if that industry collapses can brazil still pay for its foreign debt think like that I think you need to look at the holistic picture here apart from the fact the question do we want to transport meat from South America very intensive meat or non-intensive meat to Asia or not and obviously there's a discussion on diet change there as well like how much animal protein can we actually sustain if we would farm regeneratively everywhere which is I don't think a study anybody has done yet we've done it there's a study on Europe actually what kind of diet change is needed plus a switch to regenerative agriculture by a French institute, which is very interesting. And I will really try to remember to put that in the show notes. So it's not an easy answer and I don't have a clear answer on that. I'm just going down because I see six new messages, and we have four minutes, so it's going to be interesting. Andrew, thank you for sharing some. I will make sure to send that to Daniel. Trudy, what's your understanding of the potential of RegenAg for mitigating climate change? If you have to believe some of the headlines, it's going to change everything overnight, which I always find very hard to believe. My recent answer to that question is, I think, whether we like it or not, it has to be part of it. Even if tomorrow we would stop releasing all carbon because we switched to renewable energy and we did a lot of other things, we still have an endless amount of ecosystems to restore, an endless amount of hectares and land that are, as somebody of the Savory Institute said in the Nordics, underperforming landscapes or underperforming ecosystems, which I think is a very nice term. So even if you don't believe in climate change, I don't think it's a belief. Even if you don't do it for that and if you don't do it for the nutrient density etc I don't think we can escape the fact that agriculture has to fundamentally change and land use and forestry and we'll have to grow a lot more life biomass food, oils, and fibers in a much more regenerative way because we're literally running out of soil and we're seriously destabilizing the global climate because of land use change. And so if we like it, it's part of a much bigger picture than just the carbon discussion, I think. So I'm not too worried about that. Even if climate change would go away tomorrow, we invent the best fusion reactor ever invented, we still had to restore 2 billion, acres of degraded land, we still had to figure out a way to feed ourselves nutritionously, which we're not at the moment. So I think that's the potential is enormous, but I wouldn't only hinge it on that because if that happens, if we go into a period of global cooling suddenly for whatever reason, we would lose our only argument we have for this, which I don't think is a very strong basis to build a global movement on. And what are good ways to make region ag more common mainstream, how to attract more farmers and to make conventional farms. I think to the transition here, I talked about it briefly, and I think not to do a teaser, but there's a great interview coming up with the Perennial Fund where we talk about that. I think to make it mainstream, nutrient density is going to be very important, measuring nutrient density and showing the connection, healthy soil, healthy produce, healthy gut system, and healthy people, which is not there yet, but coming and very interesting, scary, and revolutionary at the the same time. So that part of it, more movies like The Biggest Little Farm, more farmers in general that are in their context doing this. I think that's the, because then we can see, touch, you can see it locally, you know it's not something that is done a thousand miles away, but actually done in your neighborhood. And for consumers to ask a lot more questions. Is your farmer in your local farmer's market that you really think is amazing, is he or she actually building soil? And can you actually verify and can you show and can you see that, et cetera? Just to be mindful of time, I see people logging off. Thank you so much for joining. I will answer a few more questions in the next couple of minutes. But if you have to run and jump off, thank you so much for sharing, asking questions. But I will stay on for a few more minutes to go through the last questions. Thank you. Will is asking, does using natural mind fertilizers such as rock and potassium chloride violate the spirit of regen egg? I don't know. I really, I've known the terms, but I'm not a farmer and I would defer these questions to the experts. What do you think the demand for trade finance focused on the most ethical regenerative products, potentially emissions offsets included will? Another will is asking. Can you, I see you're still on, can you elaborate a bit on that will?

SPEAKER_00 57:58

Hi, guys. Hi, sorry. I've got a four-year-old behind me watching Netflix, so if you get some strange interference, that'll be her. I've just been talking to some people. I have a finance background, and I'm focusing my attention on building a fintech that enables transition finance at scale. I had some contact with some people recently. I'm trying to help with their trade finance proposition, and I said to them, well, why not make it better? Very ESG, which was the term I used for them, but impact-focused, and enable those producers that are doing the best have much more efficient working capital. You can bring in investors who want to invest their cash safely but in good causes. So instead of sticking it in a money market fund, they put it in something with much more meaning and provide much greater growth potential in a relatively risk-free way to the best producers. There's also the issue, like you said, you might have a great product produced in an appropriate country. Someone from IKEA was saying on a different call earlier today, but then you've got the emissions to bring it to where you are. So it is net-net the best way to do it. The question is, do we think there's an interesting product there to go to the groups that are focused on RegenAg or regenerative organic, for example, in the US and say, how can we help? bring cheaper, more farmer-friendly finance to those sectors? I don't know the answer to that question. I'm about to try and help them find it. I wanted to put that to the group. I know there's some really smart, knowledgeable people on your calls, including yourself. I just wanted to put it out there.

SPEAKER_01 59:47

I think any... farmer-focused finance in terms of transition. Transition finance is something where we need more of. There's very little appropriate finance available for farmers that want to transition, both in the global south and global north. We're just starting to figure out that that's a thing, and we need to focus on that more. So I think the short answer is yes, but obviously farmer-focused, not putting more depth on the farmers but I think in terms of crops that are being shipped over the world I mean we can say a lot of things about seasonality and regionality but we're going to drink coffee and eat chocolate for a while and many other crops I'm just naming too that get shipped a lot and there are huge opportunities there for and huge necessities if you look at their value chain and if you look at the coming climate stress for those crops over the next 10-15 years there's an endless amount needed to to diversify, to make the systems more complex and more resilient. So I think the first things that come to mind are actually Lenny of 123, who's on the call, but also Root Capital and the Starbuckses of this world, obviously, and anybody that has been, let's say, buying commodities in a slightly more ethical way that starts to pay attention to soil could be potentially interested in that if trade finance And I don't know the background in that is a big issue there. I know for many cooperatives it is because they're waiting for money, currencies, et cetera, et cetera. Anything that can point more of that money towards regenerating soil, I think is. And then obviously the transport in the most sustainable way possible. But I don't think we're going to escape the fact that we're going to keep drinking coffee for a while and tea, by the way. But I would say, yeah, that large commodity buyers that are looking around the Nestles, Ferrero, et cetera, of this world could potentially be interested in how far their connection is to the ground. You'd be surprised how many in-between steps there are at the moment in many of these supply chains. They're very, very long.

SPEAKER_00 1:02:04

Yeah. With one or two powerful connections in the middle.

SPEAKER_01 1:02:10

Yeah. So it's not an easy feat. We have an interview coming up actually in a few weeks. I recorded it yesterday on large commodity supply chains and the work on the ground there. So that might be interesting. I'm doing teasers constantly. Your interview is coming up. Sorry for that. But they're actually quite exciting. Question for the group, Lenny, and then we're really going to wrap up. Do you have any recommendations of good methodologies of assessing the environmental and social impact? I will share, I might have already done that with you, but I will definitely put it in the show notes, some of the work we're doing at Tonic, which is one of the other hats I wear, where, yeah, more than, let's say more than soil organic matter. So I think there should be, there could be some interesting reading material there. And then I think we reached the end of the questions. So I want to thank everybody that stayed on for another five minutes so much. I will be obviously releasing this recording and as many of the show notes as I can possibly imagine. Plus probably I missed some things, but definitely email me when I do. And thank you so much and see you at the next one.