Understanding value chain impacts
It is becoming increasingly important to understand resource use across the value chain, to account for levels of environmental impact and identify possible productivity gains.
A farmer is very good at telling you what their inputs are: fuel usage, amount of fertiliser applied, etc.; as well as their outputs: harvested yields. Unfortunately they do not have the tools on hand to measure the environmental impacts of their actions, such as greenhouse gas emissions released during the cropping cycle.
A growing number of industries are facing market access requirements and social pressures from end consumers to demonstrate their environmental credentials, and precisely measure the environmental sustainability of their practices across the entire production chain.
Failure to comply risks being locked out of lucrative domestic and international markets via regulatory measures, or losing market share to competitors who are able to display better, more sustainable business practices.
We were supported by the Rural Industries Research and Development Corporation to work with Lifecycles to develop an agricultural inventory for AusLCI (Australian Life Cycle Inventory). This life cycle inventory can be used to conduct assessments that compare products, identify practices that can be improved, provide trade access where environmental credentials are required, as well as other applications.
AusAgLCI accounts for environmental impacts in five key areas of global warming, water use, land use, eutrophication (nutrient runoff), and ecotoxicity. The database covers Australia's major agricultural commodities, namely cotton, grains, horticulture and livestock feeds.
These life cycle assessment capabilities can now be accessed by Australian agricultural industries looking to demonstrate the environmental sustainability of their practices. Life cycle assessments are also a valuable method of identifying inefficiencies, which can lead to improved productivity and reduced environmental impacts.
A win for farmers and the environment
We worked with the Australian Export Grains Innovation Centre and Australian Oilseed Federation to conduct a life cycle assessment of greenhouse gas emissions from growing canola in Australia. Up to 91 per cent of Australia's canola exports go to the European Union (EU) – earning the industry around $1.8 billion of export revenue in 2016-17.
Our Country Report - Greenhouse gas emissions from the cultivation of canola oilseed in Australia showed that the Australian canola industry met the EU's Renewable Energy Directive, which required biodiesel feedstocks to demonstrate a minimum 50 per cent greenhouse gas saving compared to fossil fuel to be accepted into the EU market from 2018.
Securing the EU market for the domestic canola industry was particularly significant, as it offers a $20-40 per tonne premium for non-genetically modified canola, which Australia primarily produces.
In 2016-17 access to this market secured the Australian canola industry approximately an additional $100 million in revenue.