Farm Biodiversity: A Healthier Ecosystem, and a Healthier Investment
Biodiversity loss is a threat whose scale reaches far beyond our farmland: if we fail to protect natural resources like habitats and mangroves, studies predict “annual losses in ecosystem services worth US$14 trillion per year by 2050, equivalent to seven percent of global GDP”.
Preserving natural ecosystems in our own farming practices is an important, smaller-scale step we can take that has a direct impact on not only upholding high-quality food and nutrition standards but also mitigating some of the mounting economic costs.
Ecological farming supports biodiversity as it promotes working with the natural environment and avoids chemical and pesticide use. Biodiverse farms rely on more natural ways that support profitable yields. In addition, having different types of crops leads to healthier soil and prevents soil erosion overall, resulting in farmland that is not as threatened by degradation and thus less at-risk for unstable crop yields.
While it may be common knowledge that greater species variety makes for a more stable ecosystem that’s more resilient to challenges such as natural disasters – implementing sustainable farm practices that actively promote biodiversity can be costly in the short term. However, farms that come as close as possible to mimicking their natural, local ecosystems without disrupting the natural makeup of the land do tend to end up with higher yields and greater overall sustainability in the long run.
Farm biodiversity practices at a glance
Several strategies to increase biodiversity are being implemented in farms around the world that show promising results.
To start, growing different crops close together, or intercropping, can reduce pests and help the crops use their natural nutrients and water systems more efficiently. Conservation buffers also help to increase biodiversity. These are areas or strips of land placed between crop fields that intercept pollutants, helping to prevent nutrients, sediments, and pesticides from moving around between fields.
Planting cover crops and practicing crop rotation – sequentially planting different crops on the land – is another way to replenish nutrients in the soil instead of depleting it, all while preventing erosion. Practices such as reducing tillage – the disturbance of the soil used in many conventional farms that leads to soil erosion – and using more organic matter can also promote biodiversity. Organic matter such as manure allows soil microbes to thrive and break it down into nutrients that can be absorbed by crops.
Biodiversity is the key to farm resilience
Higher biodiversity on farms points to higher climactic resilience as ultimately healthier soils make the land more resilient to climatic pressures. This is increasingly important as climate change takes its toll.
Cases of this resilience have been recorded on farms in the northern Great Plains that implemented biodiversity strategies such as using cover crops and crop rotation: “when rainfall was 60% below normal in 2012 they still achieved 80% of normal yields, while many neighbors had no harvest at all.”
These farms also fared far better during periods of flooding. While neighboring farms experienced soil erosion, they had none. In straining circumstances like floods, biodiverse farms generally fare better as they continue to produce yields when other farms cannot – in turn providing a consistent, more reliable return.
When a biodiverse farm allows more species to thrive, many return the favor by naturally pollinating crops and preying upon pests. Pollinators in particular are important because they are essential for the growth of many crops – so important, in fact, that the “global value of their services has been estimated at €120 billion per year.”
Farms that maintain biodiversity are thus able to reduce pest pressures by increasing natural pest enemies. Preserving this symbiotic relationship reduces the need for costly inputs like pesticides, thus increasing the farm’s profit margins. Plus, reports indicate that “crops grown in soils with high organic matter content and active microorganism communities have greater resistance to diseases.”
Biodiversity as farmland investing opportunity
The value of maintaining biodiverse ecosystems in farming translates directly to services like “pollination of crops, water purification, flood protection, and carbon sequestration – with an estimated value of between $125 and $140 USD trillion per year, which is more than 150% of the global GDP.” Further, reports estimate the value of crops that rely on animal pollination adds a whopping addition that lands between 235 and 577 USD billion.
Since a significant portion of the world economy relies on biological resources, companies who have sustainable product lines will thrive throughout structural shifts; farms that preserve biodiversity will have a higher chance of being resistant to pressures of climate change.
As more companies and systems adapt to stricter governmental regulations around species and biodiversity conservation, it will become “very costly for companies to react to the requirements instead of pro-actively planning and acting in advance.” Thus, for investors, taking climate change and the carbon footprint of their portfolios into consideration should become a priority – not only “from a moral or regulatory perspective but...as an element of proper risk management. “
By investing in farmland that supports biodiverse practices, not only do you manage the carbon footprint of your portfolio, but you are also becoming part of a movement towards a more biodiverse global ecosystem. With FarmTogether, you’re able to join a community of early adopters who will set the stage for sustainable best practices for years to come.
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Disclaimer: FarmTogether is not a registered broker-dealer, investment adviser or investment manager. FarmTogether does not provide tax, legal or investment advice. This material has been prepared for informational and educational purposes only. You should consult your own tax, legal and investment advisors before engaging in any transaction.