Striking the Balance: Catalyzing a Sustainable Land Use Transition --- November 10, 2023 --- ONLINE

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Globally, land is not scarce, but only a fraction is suitable to meet our demands for food, fuel, and natural capital

Around 30 percent of the surface of our planet is land, and the majority of this—12,800 Mha—is habitable. Sixty percent of this land surface is suitable for additional cropland but currently has multiple uses (Exhibit 1). According to McKinsey analysis of Potsdam Institute’s MAgPIE (Model of Agricultural Production and its Impact on the Environment) model, today, one-third of our land surface is natural land, one-third is forested, and the remainder is pastureland, cropland, and a small share of urban land.

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Our appetite for land continues to increase, though the way in which land is used is shifting. The global population will continue to grow over the next decade, which means increased demand for land to produce food, livestock (both pasture and feed), and bioenergy crops. Biomass will also be needed to decarbonize a number of other sectors, including chemicals.2

At the same time, an increasingly adverse climate will depress agricultural yields and change land suitability in most countries.3 Our needs for food and fuel also contend with the commitments that have been made related to natural capital, including increasing tree coverage for carbon sequestration and storage and preserving biodiversity.

While land may not be scarce at a global level, the remaining available land is not all suitable or accessible for these competing needs. Challenges can emerge when a given parcel of land is well suited for multiple crops, pastureland and grazing, biodiversity conservation, carbon storage sequestration, and other uses.

By 2030, the world will need an additional 70 to 80 Mha—and perhaps more than 110 Mha—of cropland

We estimate that by 2030, the world will need additional cropland of at least 70 to 80 Mha to satisfy our needs for food, fuel, and nature (Exhibit 2). This base case is based on a set of conservative assumptions that reflect the likely condition of the world in 2030. If we factor in the possible impact of extreme weather events on yields and of geopolitical issues on trade, the additional cropland requirement could increase to more than 110 Mha.

This increase in land use is driven by three principal factors. The production of feedstock for livestock may account for around 70 percent of all incremental cropland needed by 2030, crop production for human consumption may account for around 20 percent, and biofuel production may account for the remaining approximately 10 percent. The main drivers of land use are harder to predict beyond 2030 but are likely to shift (see sidebar “Shifts in land use in the decades leading up to 2050”).

In the base case, Latin America and sub-Saharan Africa are identified as the most cost-effective locations to add nearly two-thirds of the new cropland requirement—around 20 to 30 Mha each. While these projected cropland gains are in line with historic cropland expansion, these historical trends are becoming increasingly hard to replicate due to issues with land access and climate-related shifts in land suitability.4 For example, Latin America and sub-Saharan Africa are particularly vulnerable to climate change; according to McKinsey analysis, around 80 percent of smallholders in Mexico and Ethiopia are likely to face at least one extreme weather event by 2050.5

As competition rises for the remaining suitable and accessible parcels of land, prices will likely follow. In our base case, commodity prices could increase as much as 20 to 30 percent. The increase may be even higher in land competition hot spots, further pushing up the value of land. Countries at risk of high levels of land competition include Argentina, Brazil, the Democratic Republic of Congo, Ethiopia, Tanzania, and Uruguay (Exhibit 3). In countries such as these, cropland demands do not exist in isolation. Tradeoffs on land use are necessary to manage competing priorities such as food security, the protection of biodiversity, the production of necessary energy and materials, and the securing of land for work and play. READ MORE

Striking the Balance: Catalyzing a Sustainable Land Use Transition --- November 10, 2023 --- ONLINE

Globally, land is not scarce, but only a fraction is suitable to meet our demands for food, fuel, and natural capital

By 2030, the world will need an additional 70 to 80 Mha—and perhaps more than 110 Mha—of cropland

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