Wednesday, June 12, 2013

Egg farms not exempt from climate change

There is little doubt that climate change will cause serious supply chain disruptions over the next few decades. And egg producers won't be exempt from the problems. Despite persistent denials by climate change sceptics, the connection between human behaviour and the warming of our planet has been well established.

Carbon dioxide emissions between 1850 and 1950 amounted to an average of 2 billion tonnes per year. During the 1980s this rose to 7.1 billion and by 2020 it's estimated to reach 9.8 billion.

Freak weather events caused by these changes are triggering unexpected commodity shortages and price volatility as well at causing havoc with many farming operations. This creates unprecedented supply chain instability and introduces new levels of risk and uncertainty into markets.

Only those farm and other businesses that can adapt will survive. Stable supply chains in the future will depend on action being taken at multiple levels to reduce greenhouse gas emission and mitigate climate change.

Most businesses currently externalise the cost of natural resources, creating a distorted picture of financial performance and business value. It can be demonstrated that many of the ‘services’ provided by the environment and which are essential for long term viability, are not factored into mainstream financial reporting.

The pressure on business to correct this distortion through True Cost Accounting is growing—a system in which the monetary value of natural resources such as water, timber and fossil fuels are included as costs that are reflected in the bottom line.

If True Cost Accounting is accepted as a normal business tool, and businesses pay for their use of natural resources, market dynamics will drive businesses to reduce their dependency in order to survive.

Production at Freeranger Eggs is aimed at sustainability and we believe we are well placed to meet an uncertain future – although there are bound to be problems from time to time with feed shortages and cost increases.

No comments: