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Moving Towards Sustainability: The Livestock Sector and the World Bank

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Overview

The livestock sector is a pillar of the global food system and a contributor to poverty reduction, food security and agricultural development. According to the FAO, livestock contributes 40% of the global value of agricultural output and supports the livelihoods and food and nutrition security of almost 1.3 billion people. At the same time, there is wide scope to improve livestock sector practices so that they are more sustainable, more equitable, and pose less risk to animal and human health.

Livestock play a major role in sustainable food systems---for example, manure is a critical source of natural fertilizer, while livestock used as draft animals can help boost productivity in regions where there is low mechanization. Livestock are important assets for vulnerable communities. Globally, around 500 million pastoralists rely on livestock herding for food, income, and as a store of wealth, collateral or safety net in times of need. Locally, livestock production systems have the potential to contribute to the preservation of biodiversity and to carbon sequestration in soils and biomass. In harsh environments, such as mountains and drylands, livestock is often the only way to sustainably convert natural resources into food, fiber, and work power for local communities.

Increasing incomes, changing diets, and population growth have led to increased demand and made the livestock sector one of the fastest growing agricultural sub-sectors in middle- and low-income countries. This represents a major opportunity for smallholders, agribusiness, and job creators throughout the livestock supply chain. However, if not properly managed, this growth risks accentuating sustainability issues that span equity, environmental impacts, and public health.

The transformations that accompany growth are an opportunity to move the livestock sector toward more sustainable development and improved contribution to human diets. Productivity levels and practices can be managed in ways that address adverse impacts on land, water, and the environment, as well as the risks posed to animal and human health.

Currently, the livestock sector emits an estimated 7.1 GT of CO2-equivalent per year, representing 14.5% of human-induced greenhouse gas (GHG) emissions. Increasing the efficiency of livestock supply chains is key to limiting the growth of GHG emissions in the future.

**\Moving towards environmental sustainability in the livestock sector **

The World Bank is committed to improving the livestock sector's contribution to sustainable development. The Bank supports countries to manage and respond to growing demand for animal protein in ways that are significantly less harmful for the environment and contribute significantly less to climate change.

Investing in veterinary services and animal disease surveillance is also crucial to improve animal health and welfare, reduce economic impact of animal diseases, improve food safety, and reduce risks of antimicrobial resistance. The prevention of animal diseases can limit transfer of animal pathogens to humans and control the emergence of deadly zoonotic diseases at the animal source, where action is most cost-effective. Improved livestock management is an integral part of the "One Health" approach, which seeks to optimize human, animal, and planetary health.

Requests for World Bank support to livestock operations have increased from an average of US$150 million in annual lending commitments at the beginning of the decade, to about US$700 million in new lending per year in the last three years. Most of the growth has been in Africa, South Asia, and Central Asia. Currently, the World Bank has US$1.9 billion in active investments in livestock.

As part of its commitment to helping countries build sustainable, nutritious food systems, the World Bank is moving its livestock investments towards greater sustainability and climate-smart outcomes. All investments are designed with mitigation and adaptation in mind, and an average of 61% of livestock financing over the last three years is directly tied to climate co-benefits (up from 55% in the previous period).

Bank-supported projects seek to improve various dimensions of livestock systems and value chains, using levers such as efficiency gains, balancing of animal rations and sustainable sourcing of feeds, carbon sequestration in agricultural landscapes, energy-efficient technologies and renewable energy sources, animal health and welfare, and better manure management.

For example, the Sustainable Livestock Development Program in Kazakhstan, approved in 2020, includes ambitious environmental objectives to develop a sustainable beef sector and contribute to diversifying the economy away from oil and mineral resources. The program aims to increase beef production while pursuing an absolute reduction of GHG emissions. This will be achieved in three ways: by increasing productivity and decreasing GHG emissions per unit of product through improved livestock management practices; by increasing soil carbon sequestration through improved grazing management practices; and by adopting energy-efficient equipment and renewable energy to reduce and displace fossil fuel use.

Similarly, ongoing projects in Ethiopia and in Bangladesh are anticipated to dedicate US$108.8 million and US$259 million, respectively to climate co-benefits. They promote the use a climate-smart practices among farmers and processors, enhance GHG emission monitoring and reporting capacities, and address the particular issue of clean cooling technology along the value chain.

Through ongoing studies and the development of blueprints, the World Bank seeks to improve financial incentives for livestock producers who reduce GHG emissions in their operations, by providing easier access to climate finance (such as mitigation offsets or conditional lines of credit).

The Bank is working to share knowledge and guidance in a format that is relevant to the need of investment teams. With partners, the Bank has prepared a guide to investment in sustainable livestock. The first section of the guide addresses environmental issues and climate change. The second section addresses health-related issues. A third section, under development, will address the equity dimension of sustainability.

Results

In Patagones, a semi-arid area of Argentina, switching from growing cereal to improved and natural pasture for grazing livestock is one of several strategies used by farmers to combat desertification and adapt to climate change. The switch to more resilient land and water management practices was piloted by a World Bank project financed by the United Nation's Adaptation Fund and implemented by Argentina's Secretary of Environment and Sustainable Development.

In the Sahel, the Regional Sahel Pastoralism Support Project (PRAPS) supports the countries of Burkina Faso, Chad, Mali, Mauritania, Niger, and Senegal. In a region too dry to allow for sedentary livestock, pastoralists move their herds according to the availability of water and pasture -- an early form of climate adaptation. The project helps to protect pastoral systems by improving resource management and animal health, facilitating access to markets, diversifying sources of income for pastoral households, and managing conflicts. The project established infrastructure around water points, pasture for livestock, vaccination stations, livestock markets, and fodder storage. Between 2015 and 2020, the project helped establish and improve the management of more than 5 million hectares of pastureland, 181 water points, and 66 cattle markets. It also supported the economic activity of 20,700 people, 88% of whom were women.

In Armenia, the Bank is helping to improve the productivity and sustainability of livestock and pasture systems in 109 communities managing 207,000 hectares of community pasture areas.

In Mexico in 2016, 1,165 small and medium agribusinesses, including businesses focused on livestock production, adopted environmentally sustainable energy technologies such as bio-digesters, reducing C02 emissions by 3,388,670 tons.

In Uruguay, the Bank is supporting government efforts to help farmers adopt climate-smart livestock practices. To date, on-farm investments have improved carbon sequestration in grasslands and energy efficiency of beef and dairy supply chains. The project has also helped minimize and collect waste, and promote sustainable and organic soil management by reducing fertilizer use and conserving water on dairy farms. All dairy producers in the Santa Lucia watershed (which covers clean water needs for half the country) must now supply Sustainable Dairy Plans that are mapped and tracked in an integrated information system known as SNIA, as part of a broader national effort to better manage natural resources and improve decision-making using digital technology. About 500 out of 1,200 dairy farms in the Santa Lucia watershed have also been equipped with improved effluent management systems.

In Vietnam, a Bank-supported project benefited over 151,000 livestock farmers. A key feature of the project has been the implementation of good animal husbandry practices (GAHP). Twenty-three thousand one hundred seven household-based producers received technology and learned techniques to reduce negative environmental impacts, 362 meat-processing plants improved their waste-treatment systems and 489 wet markets upgraded their facilities to improve hygiene and food safety.

In Colombia, the World Bank has engaged with local partners to pilot innovative approaches to sustainable cattle ranching production. The Colombia Mainstreaming Sustainable Cattle Ranching Project, co-funded by the UK government and the Global Environmental Facility, has allowed nearly 32,000 hectares of degraded land to be converted to silvopastoral systems (combining livestock and trees) allowing for the capture of 1.05 million tons of CO2 equivalent and the conservation of biodiversity, including 50 native species, since it started as a pilot project in 2011. Individual ranchers received training, technical assistance, key inputs such as planting materials at low costs, and financial incentives. The adoption of silvopastoral systems has achieved a 17% increase in milk production, 18.5% reduction in production costs, and a 23% increase in average number of cows per hectare between 2011 and 2018. In addition, the World Bank Biocarbon Fund's Initiative for Sustainable Forest Landscape (ISFL) program is testing approaches for reducing emissions from livestock through a partnership between IFC and Alqueria, a private company. Over the period 2018 to 2021, the ISFL is providing US$1.5 million in financing to develop climate-smart dairy production in Orinoquia that reduces GHG emissions by 25% and ensures Alqueria's milk is produced in verifiably deforestation-free areas.