PepsiCo has partnered with Yara International to accelerate the transition to low-carbon, regenerative farming across Latin America and Europe, aiming to cut emissions and enhance global food resilience. Agriculture was responsible for 37% of PepsiCo’s total emissions in 2023, prompting the company to scale its regenerative farming initiative. This partnership is a critical element of PepsiCo’s broader sustainability strategy, PepsiCo Positive (pep+), which emphasizes sustainable sourcing, improved farmer livelihoods, and climate-resilient agricultural practices.
The collaboration with Yara is designed to address both environmental and economic challenges in agriculture. Regenerative farming practices focus on restoring soil health, increasing biodiversity, and reducing the carbon footprint of farming operations. By supporting regenerative practices, PepsiCo aims to build long-term food system resilience while mitigating climate change.
The company has set an ambitious goal to implement regenerative practices across seven million acres by 2030, which aligns with its total agricultural sourcing. As of now, 1.8 million acres have been transitioned to regenerative methods, a significant step toward meeting this target. One of the first initiatives of the PepsiCo-Yara partnership focuses on Latin America, where over 20 farmers in Mexico, Colombia, Chile, and Argentina will benefit from access to low-carbon fertilizers. These fertilizers, made with ammonia derived from carbon capture or produced using clean energy, can reduce a farmer’s carbon footprint by 40% to 60%, depending on the variant. This is expected to be a game-changer for potato farms across the region, which will cover approximately 700 hectares.
In addition to providing low-carbon fertilizers, the partnership offers farmers training on efficient fertilizer use and soil preservation. This ensures that the environmental benefits of the fertilizers are maximized without sacrificing agricultural productivity. The initiative will also expand to other crops, including corn, wheat, oats, coconut, and bananas.
The collaboration extends to Europe, where PepsiCo and Yara plan to scale regenerative agriculture across 128,000 hectares. The initial focus will be on potato farms, particularly those that supply the key ingredients for PepsiCo’s Lay’s crisps. Over time, this program will extend to other core crops. Yara is set to supply up to 165,000 tonnes of low-carbon fertilizer annually, covering a quarter of PepsiCo’s fertilizer use in the region by 2030. These fertilizers will be sourced from Yara’s low-emissions plants in Norway and the Netherlands.
To support this shift, PepsiCo and Yara are providing farmers with advanced agronomic support and digital tools. Platforms such as PepsiCo’s CropTrak and ML Analytics, alongside Yara’s AtFarm and MegaLab soil diagnostics, enable precise nutrient management, improve yields, and significantly reduce on-farm emissions. These tools empower farmers with the knowledge and technology to optimize their farming practices and achieve higher productivity with less environmental impact.
Given that agriculture accounts for approximately 23% of global greenhouse gas emissions, initiatives like this are essential for building future-proof food systems. Extreme weather events such as droughts and floods are increasingly threatening harvests worldwide, and the global population is projected to reach 9.7 billion by 2050, requiring a 60% increase in food production. This makes it even more crucial to adopt sustainable farming practices that can withstand environmental pressures while meeting growing food demands.
PepsiCo’s approach helps overcome financial and technical barriers that have traditionally hindered the widespread adoption of regenerative agriculture. By being a first mover in low-carbon product research and development, PepsiCo is sending a strong demand signal to the market, encouraging further innovation and investment. This partnership exemplifies how collaboration across value chains and the support of farmers can scale regenerative farming practices in a way that is both economically viable and environmentally beneficial. It also adds to a broader industry momentum, with companies like Mars, McCain Foods, McDonald’s, and Waitrose joining PepsiCo in pushing for regenerative farming practices. The PepsiCo-Yara partnership serves as a model for others in the food and beverage sector to follow.
