Terry Stone Sustainability Value Chain Lead, North America

Illinois Soybean Association July 24, 2012

Long-Term Grower Productivity and Profitability through Sustainable Intensification

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Syngenta is a world-leading agribusiness

●  A uniquely broad product portfolio

-  A leader in crop protection

-  Third in high-value commercial seeds

●  World-class science

-  $2.5m invested in R&D every day

●  Global reach and experience

-  Over 25,000 employees in more than 90 countries

●  Commitment to working with customers

-  Tailoring solutions to individual needs

Committed to Sustainable Agriculture through innovative research and development

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Today’s Discussion

●  Agriculture must grow more from less to sustain a growing population with finite natural resources.

●  Approaches to defining and measuring sustainability.

●  Why metrics and measurement matters.

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Global drivers affecting agriculture.

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●  2 billion more people to feed.

●  2 times more food to produce.

●  30 percent less farmland per capita.

●  Increasing water scarcity/decreasing water quality.

●  Growing energy demand/limited fossil fuel supply.

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How will we bridge the gap between what is available and what will be needed?

2.5

6.5

8 9

5

2.5 2 1.6

1950 2005 2030 2050

Population (billions) Farmland (Ha/10X capita)

Source: Adapted from Syngenta Annual Review 2008 and based on 2007 Revision Population Database, United Nations, 2008 and UN Food and Agriculture Organization. Selected photos courtesy USDA-NRCS

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Agriculture’s challenge is to grow more from less.

●  Produce more bushels of food, feed & fiber.

●  Use less land, energy & water per bushel.

●  Preserve and improve natural resource base (water quality, soil quality, biodiversity).

●  Maintain profitability.

Select photos courtesy USDA-NRCS

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Grow more from less

Syngenta believes that farmers can

produce enough to meet the world’s needs

for food, fuel and fiber and safeguard the

only planet we have for future generations

– if we take a system-wide approach that

links technology, land and people. These

three elements build the foundation for a

sustainable production system in which

technology enables better solutions for

farmers to increase productivity and

profitability, to increase resource

efficiency, and help reach food security.

Classification: PUBLIC

People Land

Technology

Rural economies

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Better solutions

Choices on the farm To ensure that farms meet their productivity potential, we need enabling and transparent regulations, to make safe technologies available to farmers.

Accelerating innovation We need mechanisms to share innovation; protecting intellectual property helps stimulate research and development.

Sharing knowledge Agriculture is based on knowledge supported by science; we need new partnerships to raise agronomy skills and share expertise.

Classification: PUBLIC

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Resource efficiency

Preserving the land We need to increase productivity on existing farmland.

High stakes for water 40% of water used for agriculture is wasted; we need solutions that increase water efficiency.

Vitality of biodiversity Biodiversity and agriculture depend on each other; we need to protect the diversity of nature to secure our food supply and quality of life.

Classification: PUBLIC

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Rural Communities

Building markets Growing is not enough; farmers need supporting infrastructure and access to markets, finance and information.

Valuing farm work Rural economies carry the weight of feeding the world; farming needs to be worthwhile and profitable.

Community development We need agriculture to spur socio-economic development of rural communities.

Classification: PUBLIC

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Technology enables improvement

●  Conventional soy (Illinois) -  Rain-fed, low input -  47 bu/acre -  ~ 6.3 lb. C/bu

●  No-till soy (illinois) -  Rain-fed, intensive

management -  60 bu/acre -  ~ 4.6 lb. C/bu

Source: Syngenta

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Measurement verifies improvement

Source: Field to Market,

Soybeans Smaller footprint per bushel

1980 vs. 2011

●  Others need to know how/why your production system is sustainable.

●  98% of consumers are at least 3 generations removed from the farm.

●  Modern agriculture needs to be heard/have a voice in the debate.

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Measurement delivers value

•  Now: identifies opportunities to grow more from less, which can lower input costs and improve profit margins.

•  Near-term: can help to pre-empt input-based requirements that could limit choices & increase costs.

•  Longer-term: can be used to connect on-farm improvements in sustainability to consumer products and to potential incentives from evolving environmental markets.

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Photos courtesy USDA-NRCS

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What are the implications of how sustainability in agriculture gets defined & measured to successfully feed 9 billion people?

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What is sustainability? Definitions are complex & evolving.

More than half of consumers are familiar with the term “sustainability,” but most cannot define the term appropriately upon probing.

The Hartman Group Report on Sustainability

●  Meeting the needs of the present without compromising the ability of future generations to meet their own needs.

Brundtland Commission on Sustainable Development

●  Triple bottom line: people, planet, profit. SustainAbility Think Tank

●  Meeting the needs of the present while improving the ability of future generations to meet their own needs.

Field to Market: The Keystone Alliance for Sustainable Agriculture

:

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The supply chain is setting sustainability goals.

Sustainability Goals

PepsiCo ●  Water ●  Electricity ●  Fuel

Heinz ●  Energy ●  Carbon footprint ●  Water

General Mills

●  Energy ●  Greenhouse gas ●  Water

ConAgra ●  Water ●  Greenhouse gas

●  Walmart has taken the lead.

●  Other companies are following suit.

●  Setting reduction targets for water, energy, greenhouse gas emissions.

●  Conducting life cycle assessments.

Sources: Walmart Press Release, July 16, 2009; PepsiCo 2009 Annual Report; Heinz 2008/2009 Corporate Social Responsibility Report; ; General Mills Press Release, November 12, 2010; ConAgra Foods Press Release, April 5, 2010

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Life cycle assessment (LCA) tracks a product from raw material sourcing through point of purchase.

●  Measures environmental impact, aka footprint.

●  Methodologies are still in development.

●  Some track product through end use & disposal.

18 Source: http://www.carbontrust.co.uk

Companies are using LCA to explore opportunities to improve the sustainability of their products*

Classification: PUBLIC

Other raw materials, pre-processing & packaging

40%

Production 31%

Soy farming 9%

Corn farming 20%

403g CO2eq

Finished product life cycle * Results are unique to Just BARE Chicken Boneless Skinless Breast

based on certification by Carbon Trust

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The Sustainability Consortium (TSC) is defining the rules for sourcing a sustainable supply

●  A standard measurement & reporting system is being developed

●  Will this be based on science or consumer perceptions?

www.sustainabilityconsortium.org/

Founder

Administered in US by: •  Arizona State University •  University of Arkansas

Food, Beverage & Ag Sector Members:

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Some are based on measurable outcomes,

(e.g. 10% more yield from 20% less water, 15% less

soil loss)

Others are based on inputs (e.g. reduce pesticide use

by 20%, avoid GM, use organic N)

There is already a large divide on approaches to measuring agricultural sustainability

Outcome Based with Growth

Opportunities

Practice & input Based with

Limits on Choice

The challenge is that in agriculture “one size does not fit all”

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Practice/Inputs-based Outcomes-based

Limits choice, performance

& potential for improvement

Embraces choice performance, innovation, continuous

improvement

Threatens freedom to operate

Preserves freedom to operate

The accepted approach will affect farm operations and the potential of farming to meet the needs of future generations

Very Important, Ongoing Debate

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The divide will only be bridged through collaborative efforts with diverse representation from across the supply chain

  Broad & inclusive

  Built on “shared value”

  Our best today may not be good enough for tomorrow

  Worthy of the consumer trust

  Transparency & open source

  Continuous improvement

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