New research released by McKinsey & Company (McKinsey) reveals that while a vast majority (90 percent) of US farmers have an understanding of sustainable farming, the uptake of practices remains low. Even where farmers are adopting sustainable practices, they are only implementing them on a small share of their acreage (typically less than 30 percent).

McKinsey's 2024 US Farmer's Survey, which gathers perspectives from nearly 500 US farmers , outlines a positive outlook for the future of sustainable farming, with farmers already showing to be willing, but major barriers to adoption still remain, namely obtaining a market premium for sustainably grown crops and implementation difficulties.

The report also finds that adoption of practices is correlated with perceived return on investment (ROI), and practices with the highest perceived ROI, such as applying fertilizer based on soil sampling, have the highest rates of adoption. Although farmers have position perceptions of long-term benefits of many sustainable practices, they still expect costs to remain 1 to 3 percent higher after more than five years.

Given the acute focus on ROI, practices which require only behavioral changes, such as reduced, or no till, lead the way in adoption levels (68 percent). This is followed by practices that require product changes, such as variable rate fertilizer (~50 percent), and practices requiring equipment change, like controlled irrigation practices (35 percent), securing the lowest uptake. Considering the complexity of calculating the ROI on adoption of sustainable farming practices, McKinsey's findings suggest that a greater investment in education to help farmers better generate further data points on yield and cost benefits could also support an increased uptake in less adopted practices.

Vasanth Ganesan, Partner at McKinsey said of the findings: "Driving adoption of sustainable farming practices requires the evolution of multiple parts of our food system, and this is already being driven by many agriculture & food companies who are making commitments to lowering the sector's large emissions footprint by adopting sustainable farming methods in their everyday operations. But this is not enough, the transition to truly sustainably produced food hinges on changing behaviors and operational decisions, and the consistent support of agriculture & food ecosystem players to support farmers holistically as they look to embrace the changes that lie ahead. Our survey suggests that only by meeting their expressed need for ROI on investment in sustainable practices and providing sustainable farming practice implementation support & resources may drive widespread uptake."

McKinsey also found that government programs, such as the Environmental Quality Incentives Program (EQIP), have substantially greater participation among farmers than industry programs, with 57 percent of farmers surveyed participating in a government program versus just 4 percent for industry-sponsored. This could indicate that government programs are driving adoption and that continued programmatic support from governments and industry players may encourage more farmers to transition to sustainable farming practices.

In terms of how industry participants can support farmers in their ongoing uptake of sustainable practices, McKinsey suggests five key recommendations to consider:

• Creating long-term revenue streams for farmers such as green premiums – farmers highlight these as the most attractive financial lever to support adoption of sustainable farming
• Building sustainability programs and make them accessible – practice adoption is higher among participants in programs, but most of these are small scale today
• Investing in education to help farmers overcome operational challenges and generate further data points on yield and cost benefits, especially for less adopted practices
• Collaborating with smaller and specialty farmers near term as these farmers have a higher willingness to adopt most practices in the next two years
• Continuing to evolve and grow nutrient-related programs such as applying variable rate fertilizer – most farmers viewed these practices as ROI-positive, but only about half have adopted them and only in a part of their acreage.

To read McKinsey's findings in detail, click here.