Danone North America, rePlant Capital partner to support farmers

Low-cost loans will support members of Danone North America farmer network in conversion to regenerative or organic farming practices.

January 29, 2020

4 Min Read
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Danone North America

Danone North America, a leading food and beverage company, has announced a partnership with rePlant Capital, a financial services firm dedicated to reversing climate change. Over the next several years, rePlant will invest up to $20 million to support Danone North America's farmer partners with expenses related to converting to regenerative or organic farming practices.

These practices increase biodiversity, enhance ecosystems and enrich soil and are part of the broader commitments of the company and its partners to address climate change, the announcement said.

Danone North America works with partners across its value chain to support its farmers, lessen the impacts of its business on the environment and protect natural resources for the future. This partnership with rePlant is another example of such a commitment and demonstrates how the company thinks differently about the role of business by valuing social progress and sustainability alongside business growth, the announcement said.

Danone North America is pursuing new models of working with farmers to incentivize the adoption of new sustainable farm management practices — for example, by maintaining long-term contracts with dairies to help alleviate short-term market volatility, thus allowing them to consider new ways of farming. In 2018, the company committed to investing $6 million in soil health research over five years. By gaining a better understanding of the variables and nuances across growing regions, this research will enable Danone North America to better guide its farmer partners with regard to farm management and use of regenerative agriculture practices on their farms.

"As a company that is passionate about climate activism, we are pleased to be partnering with rePlant to support our farmers and bring new, innovative financial solutions to address climate change," Danone North America chief executive officer Mariano Lozano said. "Providing these loans mitigates the financial stress that transitioning to regenerative and organic farming practices places on our farmers and allows them to focus their energy on driving sustainable agriculture on their farms."

The first of these loans has been provided to Kansas-based McCarty Family Farms, a partner of Danone North America for almost 10 years and co-owner of MVP dairy LLC, which is the International Dairy Foods Assn.'s 2020 Innovative Dairy Farmer of the Year award winner.

McCarty Family Farms owners and fourth-generation dairy farmers Mike, Clay, David and Ken McCarty will use the loan to install moisture probes on cropland surrounding their dairy, where water access issues are a concern, to reduce the amount of water used on crops that provide forage for the dairy cows.

In addition to reducing water usage on their own farm, McCarty Family Farms is working with local feed partnerships as well as the local watershed authority to see how this program may be expanded to other farms in the region to improve water consumption and aquifer longevity within the Ogallala aquifer.

"Our livelihood depends on the health of our natural resources," said Ken McCarty of McCarty Family Farms and MVP Dairy. "We've always made caring for our land, air and water a top priority, so we are excited to receive the rePlant loan to help us continue to reduce water consumption on our farms and make a real impact in water conservation efforts in northwest Kansas."

As one of the first funds of its kind, rePlant brings together a range of impact investors and family foundations to tackle some of the greatest challenges created by climate change. At an event held at MVP Dairy — co-owned by the McCarty and VanTilburg families — in Celina, Ohio, earlier this month, the company's senior leaders gathered farmer partners and rePlant's investor network to discuss how these groups can further collaborate on funding opportunities that help farms during the transition period to regenerative or organic practice adoption.

"At rePlant, we are dedicated to investing integrated capital into food companies operating from soil to shelf in order to reverse the effects of climate change. When we look at the work Danone North America and its network of farmers are already doing in the area of regenerative agriculture, it is clear they share our commitment to improving soil health," said Robyn O'Brien, rePlant Capital co-founder, director of partnerships. "We are very excited to work together to make conversions to regenerative and organic farming practices more accessible for Danone North America's farmer partners and drive sustainability across American farms."

Danone North America has a portfolio of dairy and plant-based foods, with brands that include: Activia, DanActive, Danimals, Dannon, Good Plants, Horizon Organic, International Delight, Light + Fit, Oikos, Silk, So Delicious Dairy Free, STōK, Two Good, Vega, Wallaby Organic and YoCrunch. It has more than 6,000 employees and 13 production locations across the U.S.

RePlant Capital is a new financial services firm based in Boulder, Colo., and Oakland, Cal., that is focused on addressing the climate crisis with innovative financial products and services. The company empowers farmers to convert to regenerative, organic agricultural practices by supplying low-cost loans to finance the transition.

With more than $426 billion in U.S. farm debt and 900 million-plus farmable acres, rePlant is engaged with some of the world's largest consumer packaged goods companies to address supply chain challenges and soil health, water conservation and biodiversity concerns.

Source: Danone North America, which is solely responsible for the information provided and is wholly owned by the source. Informa Business Media and all its subsidiaries are not responsible for any of the content contained in this information asset.

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