Grass-fed vs Grain-fed Cattle

Carbon and water footprints

Francesca Camilla Bruno, Senior Analyst September 2019

francesca.bruno@ebg-capital.com

www.ebg-capital.com

2

Table of Contents

Summary .................................................................................................................................. 3

1. Carbon Footprint ............................................................................................................ 4

1.1. Life Cycle Assessment analysis ............................................................................... 4

1.2. Cattle GHGs emissions ........................................................................................... 5

1.3. Grass-fed versus grain-fed cattle ........................................................................... 7

1.4. Role of Best Management Practices ...................................................................... 9

2. Water Footprint ............................................................................................................ 10

2.1. The Water Footprint ............................................................................................ 10

2.2. Cattle Water Footprint ........................................................................................ 11

2.3. Grain-fed Cattle Water Footprint ........................................................................ 12

2.4. Grass-fed Cattle Water Footprint ........................................................................ 13

3. Sources .......................................................................................................................... 14

3

Summary

Carbon footprint

The carbon footprint measures the total greenhouse gas emissions caused directly and indirectly along product supply chains. It is measured in carbon dioxide equivalent (CO2e). The carbon footprint of cattle production systems is composed mainly by two primary factors: enteric fermentation and feed production and transport. Greenhouse gas emissions between 6 and 19.2 kg CO2e per kg of live weight depending on the type of farming system, the location, the year, the type of management practices, the allocation, as well as the boundaries of the study.

Estimates of GHG Emissions kg CO2e/kg of product at farmgate

Source Environmental Working Group

Ottawa Research Centre

Michigan State University

Meat & Livestock Australia

Food Climate Research Network

Grass-fed 10.99 19.2 9.62 11.7 – 12.4 11.3

Grain-fed 13.17 8.4 - 15.3 6.09 12.1 13.7

Water footprint

The Water Footprint measures freshwater consumption and pollution along product supply chains. In beef meat production, water is required for growing the feed, for animals drinking and on the livestock farmland and at the slaughter house for cleaning. Efficiency improves and water footprint decreases from grass-fed to grain-fed systems.

Estimates of Water Footprint (l/kg) of product at farmgate (Source: UNESCO-IHE)

World Brazil China Netherlands USA

Grass-fed 21’829 23’895 16’140 - 20’217

Grain-fed 10’244 8’812 13’089 4’508 3’856

4

1. Carbon Footprint

1.1. Life Cycle Assessment analysis

The carbon footprint measures the total greenhouse gas emissions caused directly and indirectly along product supply chains. It is measured in carbon dioxide equivalent (CO2e). Life Cycle Assessment analysis (LCAs) usually consider the following GHGs and calculate their carbon dioxide equivalents based on each one’s global warming potential (GWP: the warming effect relative to carbon dioxide over a 100-year time frame):

1. Carbon dioxide (CO2) with a GWP of 1;

2. Nitrous oxide (N20) with a GWP of 298;

3. Methane (CH4) with a GWP of 25;

4. Hydrofluorocarbons with a GWP of 1430.

To calculate the carbon footprint of cattle production systems, LCAs usually include GHG emissions associated with the following processes:

• Production and transport of “inputs”, such as fertilizers, pesticides and feeds for animal production;

• On-farm generation of GHG emissions (e.g., the enteric fermentation digestive process of cows; manure management; soil emissions from fertilizer application; etc.);

• On-farm energy use (fuel and electricity, including energy used for irrigation);

• Transportation of animals.

LCAs usually do not consider the following processes related to food production:

• Production of capital goods and infrastructure;

• Energy required for water use in growing livestock feed;

• Consumer transport to and from retail outlets;

• Home storage of food products.

LCAs typically calculates only the GHGs associated with the production of one unit of edible meat or live carcass at farmgate. This differs considerably from the functional unit of 1 kilogram of consumed, edible product. In this case, GHG emissions calculation also include the emissions due to processing (slaughter, packaging and freezing), refrigeration (retail and transportation), cooking, retail and consumer waste (waste before and after cooking, including served but uneaten food that is thrown away).

5

Figure 1: Production and post-production emissions per kg of produced and consumed food. Source: EWG

Predicting GHG emissions with absolute certainty is difficult. Actual GHG emissions associated with a given product will vary depending on:

• the extent to which best practices are implemented along the entire supply chain;

• differences in input data as a result of regional and/or production system differences for a for a given meat production system.

1.2. Cattle GHGs emissions

There are two primary avenues in which raising cattle leads to greenhouse gas emissions:

• enteric fermentation (46%): the cattle themselves release methane into the atmosphere;

• feed production and transport (28%).

6

Figure 2: Emissions factors for kg of edible beef meat at farmgate. Source: EWG

Enteric Fermentation: Ruminant animals such as cows emit methane from enteric fermentation, a digestive process in which microorganisms break down carbohydrates into simple molecules for better absorption. Calculations for methane from enteric fermentation are based on the kind of feedstuffs ingested by livestock species and the quality of the ingredients in the feed mix. For example, feedstuffs with higher fiber content, such as grass and hay, generate higher emissions than a higher quality, grain-based diet. The cow-calf and steer calf stages generate more than 65% of the total GHG emissions, with the remaining emissions generated during confinement. During the cow-calf phase, the cow consumes copious amounts of hay.

Feed production: Feed production requires significant fuel, water and energy to produce and apply pesticides and fertilizer and to grow and feed crops.

Manure emissions: Methane and nitrous oxide are generated from manure deposits. Methane emission estimates from manure management are based on the type of manure management system (pasture, solid storage, liquid), the average temperature of the geographic location, and the amount of volatile solids excreted. Direct and indirect nitrous oxide emissions from manure are calculated based on nitrogen balance (in turn based on crude protein content in the diet) and the quantities of nitrogen excreted. Emission factors vary depending on the actual manure management system (such as pasture, dry lot, solid storage, liquid/slurry, poultry manure with/without litter, etc.).

Transport of inputs: All production phases require the use of transportation of inputs and outputs. The actual distance traveled by different inputs varies by region and production system. In some cases, animals are trucked much farther than 300 km from where they are born to where they are raised in confinement. The distance that food travels to its final destination will also vary.

7

Fertilizer and Pesticide Production: Fertilizer and pesticide production are energy-intensive processes that rely primarily on fossil fuels. CO2 is generated from the energy used in production and in treating the resulting wastewater.

On farm energy use: Primary energy use and GHG emissions per unit of electricity supplied through the grid are usually calculated using activity data consisting of fuel and power plant mixes for various grid regions, as well as transmission losses and other details.

Soil Carbon Emissions and Sequestration: Net carbon can be emitted from or sequestered in soil depending on the kinds of agricultural practices employed on the land and whether the system is in transition or steady state. While certain types of management practices, such as tillage and intensive grazing, are known to generate a loss of carbon, other practices such as rotational grazing and organic fertilization are known to build up carbon in the soil. Rates of soil carbon sequestration and emissions from soils differ under different land management regimes, but these differences remain poorly understood.

1.3. Grass-fed versus grain-fed cattle

Production emissions in grass-fed and grain-fed systems primarily differ in the emissions from feed production: grass-fed cattle tend to reduce their carbon footprint by consuming grasses grown requiring less fertilizer and chemical inputs, while the environmental costs of producing feed for grain-fed cattle are high, as feed requires fossil-fuel-based fertilizers, pesticides, irrigation and transportation.

Both systems produce relatively high methane from enteric fermentation due to the high-fiber diets. Studies have shown that grass-fed cattle produce 20% more methane in their lifetime than grain-fed cattle. This is due to two different factors:

• cattle naturally emit more methane when digesting grass,

• grass-fed cattle reach market weight more slowly than grain-fed cattle, resulting in emissions overtime as they spend more time on pasture, consuming feed and producing CH4.

8

Figure 3: Animal production characteristics from feedlot to grazing (AMP). Source: Michigan State University

However, grass-fed cattle may mitigate these increased emissions through carbon sequestration: cattle rotated across pasture land encourage new growth while working manure and other natural fertilizers into the soil. In any case, cattle fed on grass release more greenhouse gas emissions than they are able to offset through soil carbon sequestration.

Cattle are also contributing to global deforestation and its indirect GHG emissions, especially in grass-fed production systems.

In conclusion, the carbon footprint of beef cattle ranged between 6 and 19.2 kg CO2e per kg of live weight depending on the type of farming system, the location, the year, the type of management practices, the allocation, as well as the boundaries of the study, as shown in the following table:

Estimates of GHG Emissions kg CO2e/kg of product at farmgate

Source Environmental Working Group

Ottawa Research Centre

Michigan State University

Meat & Livestock Australia

Food Climate Research Network

Grass-fed 10.99 19.2 9.62 11.7 – 12.4 11.3

Grain-fed 13.17 8.4 - 15.3 6.09 12.1 13.7

9

Figure 4: Carbon footprints of regional beef production systems. Source: American Meat Science Association

1.4. Role of Best Management Practices

Substantial reductions in carbon footprint have been observed in the last thirty years mainly because of improved genetics, better diets, and more sustainable land management practices. The degree of their success depends on many factors such as whether the cattle are raised intensively or extensively, whether the cattle are grass or grain finished, the quality and type of pasture, the management of feed crops and their location, the amount and type of chemical inputs, and the amount and type of energy used for farm operations.

Depending on differences in production system inputs, management practices and consumption patterns, there is some variability in the exact GHG emission for a given product. The key factors that may alter GHG emission numbers are:

Overall efficiency of the agricultural operation: Greater yields per input will naturally result in lower GHGs; more productive agricultural systems tend to produce the fewest GHGs per unit. However, in some cases efficiency gains can be counteracted by unintended consequences. For example, feed production efficiency gains could be achieved by increased fertilizer use, which could in turn lead to increased nitrous oxide emissions.

10

Nutritional quality and digestibility of feed: High quality diets (based on ingredients such as corn and soy) will result in lower methane emissions from the cow’s digestive process compared to lower quality, higher-fiber diets consisting of grass and hay.

Manure management practices: Solid manure storage will have lower methane emissions than open pit or liquid manure systems; ensuring that manure is then spread on fields in an efficient will also reduce the N20 emissions.

Grazing practices: Intensive grazing (whereby animals are regularly moved to fresh pasture to maximize the quality and quantity of forage growth) generates fewer GHGs than the more common practice of extensive grazing. Using soil amendments could result in steady sequestration of carbon by pastureland and would reduce the overall emissions of this stage of the process.

Soil management practices: Various best practices in soil management, such as cover cropping and composting, result in lower emissions by building soil organic carbon. At the same time, reducing fertilizer use for growing feed (especially corn) could result in decreases in energy use from fertilizer production as well as decreases in nitrous oxide emissions.

2. Water Footprint

2.1. The Water Footprint

Agriculture accounts for 92% of the freshwater footprint of humanity, and almost one third is directly or indirectly used for animal products as they have a particularly large water requirement per unit of nutritional energy.

The Water Footprint measures freshwater consumption and pollution along product supply chain. It is a multi-dimensional indicator, giving water consumption volumes by source and polluted volumes by type of pollution:

• Green Water Footprint (consumption of rainwater),

• Blue Water Footprint (consumption of surface and groundwater),

• Grey Water Footprint (pollution of surface or groundwater).

The Water Footprint is determined also by local climatic conditions, such as rainfall and temperature, in combination with soil conditions and agricultural practice.

11

2.2. Cattle Water Footprint

In meat production, water is required for growing the feed, for animals drinking, on the livestock farmland and at the slaughter house for cleaning.

The overall water footprint depends on the relative importance of the these main determining factors:

Among these processes, the animal feed is the one that requires and pollutes large amounts of water. It is composed by three main factors:

• how much the animals eat, measured as feed conversion efficiency (feed amount per unit of meat obtained),

• what the animals eat, measured as feed composition (particularly the ratio of concentrates to roughages),

• feed origin (water use related to feed crop growing varies across and within regions).

Efficiency improves and water footprint decreases from grazing to industrial systems, because:

• animals in industrial systems get more concentrated feed, move less, are bred to grow faster and slaughtered younger,

• feed conversion efficiency in beef production improves, as industrial systems use 3.7 times less feed than the grazing systems to produce the same amount of beef. The fraction of concentrates in the total feed mix, however, is larger for the industrial systems than for the grazing systems.

12

Figure 5: Green, blue and grey water footprints of beef for Brazil, China, the Netherlands and the US for the grazing, mixed and industrial production systems. Source: UNESCO-IHE

Estimates of Water Footprint (l/kg) of product at farmgate (Source: UNESCO-IHE)

World Brazil China Netherlands USA

Grass-fed 21’829 23’895 16’140 - 20’217

Grain-fed 10’244 8’812 13’089 4’508 3’856

Systems that belong to the same category, grazing, or industrial, differ in the feed they provide to animals. Often, the feed ingredients have different Water Footprints, resulting in differences in the total green, blue and grey Water Footprint of the meat.

It’s important to mention that approximately 99% of all livestock spends some final portion of their life in a feedlot, where they eat mostly corn- and soy-based feed. The other approximately 1% continue to graze on pastureland and are given little supplemental feed.

2.3. Grain-fed Cattle Water Footprint

Feedlots can contain from a few hundred to up to tens of thousands of head of cattle, which are confined in close quarters. This system evolved to give beef producers a method of maximizing profits by controlling the environment and fattening animals as quickly as possible. Feedlots offer factory-style efficiency and the cattle gain weight quickly by eating specially developed feed comprised of protein- and energy-packed grain concentrate (e.g., corn, soy and grain distillates leftover from biofuel operations). The feed often includes low-dose antibiotics, growth hormones and other supplements to promote faster growth. Feed

13

conversion efficiency is increased, which shortens the time it takes to get cattle to market weight.

• Green Water Footprint: SMALL-MEDIUM. A significant portion of feed comes from rainfed corn and/or soy crops, depending on where the grain came from;

• Blue Water Footprint: MEDIUM-LARGE. The main component of the blue water footprint comes from the irrigation of specially formulated feed that uses surface and/or groundwater. There are also small amounts of direct water uses such as onsite water required for feed preparation and mixing, animal drinking and facility maintenance;

• Grey Water Footprint: LARGE. Major indirect water pollution occurs because of farm field runoff of fertilizers and pesticides that were applied to corn and soy crops. Synthetic fertilizers are one of the primary causes of dead zones in US freshwater and marine systems.

2.4. Grass-fed Cattle Water Footprint

In a grass-fed livestock system, almost all of the animal feed comes from pastures and rangelands where the cattle live. Because a pastured beef cow or steer eats less energy-dense food, the amount of time needed to bring it to market weight and ready it for slaughter is longer than for those animals raised in industrial systems.

• Green Water Footprint: LARGE. Cattle rely primarily on rainfed grasses and forage that is grown or cultivated on pasture and rangeland. This more natural diet lengthens the time it takes to get cattle to market weight. The green water footprint is larger but there are significantly less impacts on local water resources.

• Blue Water Footprint: SMALL. In general, cattle don’t rely on irrigated crops from offsite farms, although many pasture operations supplement with hay during winter months and/or drought conditions, and that feed may sometimes have been irrigated.

• Grey Water Footprint: SMALL. Since the number of cattle per land area is low, less manure is produced and thus, far less pollution from manure runoff is incurred. There is also little to no indirect water contamination resulting from pesticides, fertilizers, growth hormones and other feed supplements found in the industrial system, because these substances are not typically present in the pasture-raised cattle system.

14

3. Sources

Impact of grass/forage feeding versus grain finishing on beef nutrients and sensory quality: The U.S. experience

Nutritional composition of the meat of Hereford and Braford steers finished on pastures or in a feedlot in southern Brazil

A review of fatty acid profiles and antioxidant content in grass-fed and grain-fed beef.

Enhancing the fatty acid profile of milk through forage-based rations, with nutrition modeling of diet outcomes

An Increase in the Omega-6/Omega-3 Fatty Acid Ratio Increases the Risk for Obesity

Is Grassfed Meat and Dairy Better for Human and Environmental Health%253F

Disclaimer

This document was produced by EBG Capital AG and is for information purposes only. EBG Capital AG makes no representation or warranty, express or implied, as to the accuracy or completeness of the information contained herein and shall not have any liability for the information contained in, or any omissions from, this document. The information contained is subject to change at any time and without obligation to notify the recipient. Unless otherwise indicated, all figures are unaudited and are not guaranteed. Any action derived from this information is always at the recipient’s own risk. This document is for information purposes only. The information does not release the recipient from making his/her own assessment. This document may be cited if the source is indicated.

©2019 EBG Capital AG. All rights reserved.