‘Net-Zero’ Policies, ESG Reporting Raise Farm Costs, Food Prices—Report

From Heartland Daily News

Tim Benson

So-called “net-zero” climate policies are imposing significant costs on American farmers and families, according to a new report from The Buckeye Institute.

A model developed by Buckeye for the report, Net-Zero Climate-Control Policies Will Fail the Farm, indicates that complying with net-zero emissions mandates, and environmental, social, and governance (ESG) reporting standards is likely to increase annual operating expenses for farmers by at least 34 percent. In addition, the model indicated the mandates will result in a 15 percent annual increase in grocery bills for families, as well as significant increases in individual grocery item prices, such as American cheese (79 percent), beef (70 percent), bananas (59 percent), rice (56 percent), and chicken (39 percent).

Net Zero and ESG

“Net-zero” refers to the balance between the amount of carbon dioxide emissions produced and the amount removed from the atmosphere. For a country to achieve “net-zero,” means either not producing any emissions at all or “offsetting” an equivalent amount of emissions through methods like “carbon capture and storage,” reforestation, and the use of “renewable” energy sources. Carbon dioxide pricing schemes like cap-and-trade systems or carbon dioxide taxes are other significant “net-zero” policies.

Meanwhile, ESG scores are essentially a risk assessment mechanism increasingly used by investment firms and financial institutions that force large and small companies to focus upon politically motivated, subjective goals which often run counter to their financial interests and the interests of their customers.

Companies are graded on these mandated commitments to promote, for example, climate or social justice objectives. Those that score poorly are punished by divestment, reduced access to credit and capital, and a refusal from state and municipal governments to contract with them.

ESG Targeting Agriculture

Many of ESG’s metrics, primarily those related to imposing environmental controls, are directly linked to the agricultural industry and food production. Examples of some of these metrics include: “Paris [climate agreement]-aligned GHG [greenhouse gas] emissions targets,” “Impact of GHG emissions,” “Land use and ecological sensitivity,” “Impact of air pollution,” “Impact of freshwater consumption and withdrawal,” “Impact of solid waste disposal,” and “Nutrients”—which, despite its innocuous-sounding name, is a metric that forces companies to estimate the “metric tonnes of nitrogen, phosphorous, and potassium in fertilizer consumed.”

Farmers and food producers use chemical fertilizers and pesticides for crop growth, in addition to producing waste biproducts, consuming substantial quantities of water, using vast swathes of land, and releasing what climate alarmists claim to be planet-ending carbon dioxide emissions.

“Europe, fully committed to the Paris Climate Accords’ decarbonization plan, provides a forecast of the agricultural and economic consequences likely to result from the ESG-reporting agenda,” the report notes. “After implementing strict ESG-reporting mandates, European banks, for example, became reluctant to lend to farmers with high nitrogen and methane emissions. Reduced credit strained family farms.

“Europe’s emissions cap-and-trade policies exacerbated the problem and helped put generational farmers out of business,” the report continues. “Those policies also raised prices of farm-related energy and fertilizer, which, in turn, raised the price of food and groceries.”

‘Immolated’ Farming Industry

The report describes how the European Union’s commitment to the Paris climate agreement and associated ESG and net zero goals are undermining its agricultural sector and food security, which has lessons for the United States.

“Europe immolated its farming industry and made the continent’s food supply more expensive and less secure,” the report says. “Adopting similar policies in the United States will yield similar results.”

Federal and State Fixes

The report makes a number of recommendations for what can be done to “avoid the failures of net-zero policies.”

Federally, they suggest the United States withdraw from the Paris Climate Accords, repeal the “renewable energy” and carbon capture and sequestration subsidies in the Inflation Reduction Act, and consider banning federal agencies like the Farm Credit Administration from utilizing ESG policies.

On the state level, the report recommends states legislatures pass laws preventing “state agencies, fund managers, insurers, and lenders from using ESG criteria to guide investment decisions and set insurance policies and premiums.”

Enlisting the Private Sector

For the private sector Buckeye’s report suggests corporate boards from industries “that will be negatively impacted by ESG reporting and other net-zero policies should inform shareholders about how ESG-reporting requirements will affect operations and long-term shareholder value.” They also suggest farmers “decouple farming practices from their purported climate benefits and use the methods that are best for their farms, families, and produce.”

“Government climate-control policies ensconced in the Paris Climate Accords, the Inflation Reduction Act, and ESG-guided mandates carry a hefty price tag, especially for U.S. farms and the American consumer,” the report concludes. “The full price of climate control policies and directives needs to be measured and understood, especially the costs they will inflict on American farms and households.”

‘Unrealistic, Unattainable,’ and Costly

Buckeye’s analysis is important for putting numbers on the high cost of ESG and Net Zero policies, providing an evidence-based warning to Americans not to follow Europe’s path, says Cameron Sholty, Executive Director of Heartland Impact.

“This report shows what American and European farmers intuitively knew: that net zero carbon emissions are unrealistic, unattainable, and ultimately add cost through the supply chain and ultimately to consumers’ pocket books,” said Sholty. “Buckeye should be commended for putting the numbers to the insidiousness of ill-advised carbon-free farming pursuits.

“Its folly imposed by activists seeking to control the means of production and how we live and thrive in a civilized society,” Sholty said.

Tim Benson ([email protected]) is a senior policy analyst with Heartland Impact.

For more on farm policy, click here.

For more on net zero, click here.

For more on ESG, click here.

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Quick Hit:

USDA Secretary Brooke Rollins has unveiled the Trump administration’s plan to tackle surging egg prices, focusing on chicken repopulation and biosecurity measures while rejecting mandatory vaccines for poultry. The move aims to counter the economic impact of mass culling under the Biden administration’s failed policies.

Key Details:

The USDA’s $1 billion plan includes biosecurity enhancements, rapid chicken repopulation, deregulation, and increased egg imports.
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The administration is prioritizing securing farms against virus transmission while working on long-term solutions to stabilize egg prices.

Diving Deeper:

USDA Secretary Brooke Rollins, in an exclusive interview with Breitbart News, detailed the Trump administration’s aggressive approach to reducing skyrocketing egg prices, which she attributed to policy failures under former President Joe Biden. Rollins made it clear that President Donald Trump’s administration is focusing on restoring the poultry industry through chicken repopulation, strengthening biosecurity at farms, and removing unnecessary regulations that have stifled industry growth.

Rollins criticized Biden-era policies, noting that while the previous administration recognized the risks of avian flu, it failed to act decisively. “This has been going on now for two years. So it isn’t just regulation and all of the cost input increases and overregulation from the Biden administration, but it’s also not completely addressing the avian bird flu a couple years ago when it first hit,” she said. Under Biden, approximately 160 million chickens were culled, exacerbating supply shortages and sending prices soaring.

To address the crisis, the USDA’s plan includes five key pillars. First, the administration is investing in farm biosecurity, ensuring facilities are properly sealed to prevent virus transmission from wild fowl. Second, the repopulation of poultry flocks is being expedited by removing regulatory roadblocks. Third, the administration is pushing for deregulation in areas such as processing plant operations and California’s Proposition 12, which Rollins called “devastating” to the industry. Fourth, to alleviate immediate supply issues, the U.S. is negotiating egg imports from Turkey and other nations.

The final component of the plan, initially a proposed vaccine initiative, has been scrapped. Rollins stated that studies showed vaccinated poultry in Mexico still contracted avian flu at an alarming rate, making the approach ineffective. “I pulled that off the table,” she declared, adding that the administration is prioritizing research into alternative therapeutic solutions.

In addition to economic recovery efforts, Rollins praised President Trump’s recent address to Congress, highlighting his focus on American farmers and families. She also condemned congressional Democrats for their lack of support for crime victims’ families honored during the speech. “It is stunning,” Rollins said of their refusal to stand during key moments.

Looking ahead, Rollins reaffirmed the administration’s commitment to American farmers, emphasizing that Trump’s trade strategy is centered on protecting agricultural interests. “He is hyper-focused and passionately involved himself… fighting for our farmers, our ranchers, and entire agriculture community,” she said.

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Dairy Farmers Need To Wake Up Before The System Crumbles

Published on March 6, 2025

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From the Frontier Centre for Public Policy

By Dr. Sylvain Charlebois

Without reform, Canada risks losing nearly half of its dairy farms by 2030, according to experts

Few topics in Canadian agriculture generate as much debate as supply management in the dairy sector. The issue gained renewed attention when former U.S. President Donald Trump criticized Canada’s protectionist stance during NAFTA renegotiations, underscoring the need to reassess the system’s long-term viability.

While proponents argue that supply management ensures financial stability for farmers and shields them from global market volatility, critics contend that it inflates consumer prices, limits competition, and stifles innovation. A policy assessment titled Supply Management 2.0: A Policy Assessment and a Possible Roadmap for the Canadian Dairy Sector, conducted by researchers at Dalhousie University and the University of Guelph, sheds light on the system’s inefficiencies and presents a compelling case for reform.

Designed in the 1970s to regulate production and stabilize dairy prices, Canada’s supply management system operates through strict production quotas and high import tariffs. However, as successive trade agreements such as the USMCA, CETA, and CPTPP erode these protections, the system appears increasingly fragile. The federal government’s $3-billion compensation package to dairy farmers for hypothetical trade losses is a clear indication that the current structure is unsustainable.

Instead of fostering resilience, supply management has created an industry that is increasingly dependent on government payouts rather than market-driven efficiencies. If current trends persist, Canada could lose nearly half of its dairy farms by 2030 — regardless of who is in the White House.

Consumer sentiment is also shifting. Younger generations are questioning the sustainability and transparency of the dairy industry, particularly in light of scandals such as ButterGate, where palm oil supplements were used in cow feed to alter butterfat content, making butter harder at room temperature. Additionally, undisclosed milk dumping of anywhere between 600 million to 1 billion litres annually has further eroded public trust. These factors indicate that the industry is failing to align with evolving consumer expectations.

One of the most alarming findings in the policy assessment is the extent of overcapitalization in the dairy sector. Government compensation payments, coupled with rigid production quotas, have encouraged inefficiency rather than fostering innovation. Unlike their counterparts in Australia and the European Union — where deregulation has driven productivity gains — Canadian dairy farmers remain insulated from competitive pressures that could otherwise drive modernization.

The policy assessment also highlights a growing geographic imbalance in dairy production. Over 74% of Canada’s dairy farms are concentrated in Quebec and Ontario, despite only 61% of the national population residing in these provinces. This concentration exacerbates supply chain inefficiencies and increases price disparities. As a result, consumers in Atlantic Canada, the North, and Indigenous communities face disproportionately high dairy costs, raising serious food security concerns. Addressing these imbalances requires policies that promote regional diversification in dairy production.

A key element of modernization must involve a gradual reform of production quotas and tariffs. The existing quota system restricts farmers’ ability to respond dynamically to market signals. While quota allocation is managed provincially, harmonizing the system at the federal level would create a more cohesive market. Moving toward a flexible quota model, with expansion mechanisms based on demand, would increase competitiveness and efficiency.

Tariff policies also warrant reassessment. While tariffs provide necessary protection for domestic producers, they currently contribute to artificially inflated consumer prices. A phased reduction in tariffs, complemented by direct incentives for farmers investing in productivity-enhancing innovations and sustainability initiatives, could strike a balance between maintaining food sovereignty and fostering competitiveness.

Despite calls for reform, inertia persists due to entrenched interests within the sector. However, resistance is not a viable long-term strategy. Industrial milk prices in Canada are now the highest in the Western world, making the sector increasingly uncompetitive on a global scale. While supply management also governs poultry and eggs, these industries have adapted more effectively, remaining competitive through efficiency improvements and innovation. In contrast, the dairy sector continues to grapple with structural inefficiencies and a lack of modernization.

That said, abolishing supply management outright is neither desirable nor practical. A sudden removal of protections would expose Canadian dairy farmers to aggressive foreign competition, risking rural economic stability and jeopardizing domestic food security. Instead, a balanced approach is needed — one that preserves the core benefits of supply management while integrating market-driven reforms to ensure the industry remains competitive, innovative and sustainable.

Canada’s supply management system, once a pillar of stability, has become an impediment to progress. As global trade dynamics shift and consumer expectations evolve, policymakers have an opportunity to modernize the system in a way that balances fair pricing with market efficiency. The recommendations from Supply Management 2.0 suggest that regional diversification of dairy production, value-chain-based pricing models that align production with actual market demand, and a stronger emphasis on research and development could help modernize the industry. Performance-based government compensation, rather than blanket payouts that preserve inefficiencies, would also improve long-term sustainability.

The question is no longer whether reform is necessary, but whether the dairy industry and policymakers are prepared to embrace it. A smarter, more flexible supply management framework will be crucial in ensuring that Canadian dairy remains resilient, competitive, and sustainable for future generations.

Dr. Sylvain Charlebois is senior director of the agri-food analytics lab and a professor in food distribution and policy at Dalhousie University.