PEP PepsiCo Inc

By Dieter Holger

PepsiCo Inc. is putting its weight behind so-called regenerative farming in a bid to cut greenhouse gas emissions in its supply chain, a challenge that more food-and-beverage companies have recently been taking up.

The Purchase, N.Y.-based company said Tuesday that it plans to spread regenerative farming--a nascent concept broadly aimed at achieving sustainable agriculture--across 7 million acres of land, roughly equal to its entire agricultural footprint.

PepsiCo said the effort will eliminate at least 3 million tons of emissions by 2030 and involves expanding regenerative agriculture across more than 500,000 acres of U.S. farmland by the end of this year.

About 40% of the land in the U.S. is farmland, encompassing more than 900 million acres, according to the U.S. Department of Agriculture.

Food loss and waste accounts for 8% of the world's greenhouse gas emissions, according to the United Nations, making sustainable agriculture a key area of interest for companies looking to reduce their environmental footprint.

The role of regenerative agriculture in combating climate change isn't yet clear, and it remains a loosely defined concept. The practice involves using plants to soak up carbon dioxide, which can earn farmers valuable carbon credits, as well as lowering crops' environmental footprint by cutting water and chemicals use, and managing soil in a way that slashes emissions. PepsiCo said it hopes a global standard around the method will eventually materialize.

The company didn't disclose its dollar commitment to the agricultural regeneration project but said it is tied to future sustainability investments.

"Investing in this area is, of course, essential and helps our business thrive in the long-term," said Jim Andrew, PepsiCo's chief sustainability officer. "The principles of our ambition will be fully integrated into our business and directly tied to all the business decisions we make."

The plan isn't PepsiCo's first foray into sustainable agriculture. Its Walkers snack brand in the U.K. has a "circular potatoes" project that uses potato peelings to make low-carbon fertilizer, which the company said can cut 70% of the carbon emitted from growing potatoes.

PepsiCo is one of several U.S. companies setting their sights on regenerative agriculture. Earlier this month, agrisciences company Corteva Inc. said it will help more farmers move into the field. In March, Keurig Dr Pepper Inc. said it would support regenerative agriculture and conservation on 250,000 acres of land by 2030.

Crops aren't the only source of emissions in the supply chains of food-and-beverage companies, which buy plastic and metal to package their goods. To tackle that challenge, PepsiCo had said in January that it aims to cut 40% of the emissions from its supply chain--which are known as Scope 3 and contained in the products companies sell--by 2030 from 2015 levels.

"We are committed to reducing emissions from our manufacturing and supply chain, and regenerative agriculture helps us broaden the ways we can capture carbon," Mr. Andrew said.

Write to Dieter Holger at dieter.holger@wsj.com; @dieterholger

(END) Dow Jones Newswires

April 20, 2021 05:14 ET (09:14 GMT)

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