At the tail end of 2025, the European Union’s (EU) decisionmakers agreed on a 2040 climate target that was weaker than the one first proposed by the European Commission. How this target will be achieved is now being discussed, so the full implications for the agricultural sector are not yet known, but it may very well mean that the food and farming sector is asked to contribute less to climate protection in the coming years than initially anticipated.
Far from being a relief for the sector, it may increase the transition risks for farmers and the industry in the long term. IATP’s new blog unpacks why.
Last-minute negotiations among leaders of EU Member States right before the annual United Nations climate summit (COP30) last year saved the EU’s headline target of a net 90% greenhouse gas (GHG) emission reduction below 1990 levels. Yet one is well-advised to read the fine print: only 85% of those GHG emission reductions need to be achieved within the EU itself. The rest can be achieved by buying carbon credits from actions taken outside the EU.
What this headline target means for individual sectors is not yet clear. The European Commission is expected to present its policy plan, including any agriculture sector-specific measures, for how to achieve the target towards the end of this year.
But does a weaker climate target mean farmers can breathe a sigh of relief? And should they? Let’s dig into some numbers to better understand what’s coming.
What a weaker climate target could mean for the agriculture sector
It is logical to assume that the agricultural sector will be asked to deliver less climate protection now that the EU’s economy-wide target is weaker. But what could this mean in terms of concrete pollution cuts?
The modelling that the Commission prepared to support in the original 2040 target proposal can provide some clues as to the magnitude of cuts needed in the agriculture sector. This modeling was not based on an agriculture-specific policy package — this will come towards the end of this year — but it can still deliver ballpark figures, helping to better understand the scale of GHG emission reductions required.
In its original 2040 target recommendation, the Commission had envisaged about a 30% reduction in agriculture GHG emissions from 2015 levels — mostly methane and nitrous oxide emissions — as part of the modelling done to prepare for its 90% net GHG emission reduction target.1
The Commission did also model less ambitious economy-wide targets. Matching up those scenarios to the weaker climate 85% net emissions reduction target suggests that expectations for the agriculture sector may be equally lowered from a 30% reduction to 22% below 2015 levels.2
Additional policy action is still needed — even with a weaker target
In 2023, EU agriculture emissions were 5% below 2015 levels. Looking ahead, the EU’s own projections of the sector’s GHG emissions show that there is a gap between where the sector’s GHG emissions are projected to be and where they should be to be in order to achieve the EU’s 2040 climate target.
With the policies that national governments have in place now, agricultural emissions would only continue to fall gradually until 2040, achieving just a 12% reduction in GHG emissions below 2015 levels, compared to the 22% needed to meet the target. If the policies governments are planning to adopt are fully implemented, emissions will decrease by just 16% (see Figure 1).
While these numbers can give us a sense of the overall picture, there is reason for caution. Agriculture GHG emissions dropped about 3% in 2022 — driven by reductions in nitrous oxide emissions from soils (see Figure 2). This development coincided with the Russian invasion in Ukraine and the subsequent sharp increase in fertilizer prices, resulting in a decrease in the consumption of synthetic fertilizer across the EU.
So far, fertilizer consumption has not rebounded. Despite prices having fallen from their peak, prices are still twice as high as before the invasion. However, without policies that enable farmers to systemically switch production systems that make them less reliant on synthetic fertilizer, this trend cannot easily be assumed to continue should prices fall and may make GHG emission reduction projections for 2040 appear overly optimistic.
This unambitious (and uncertain) trajectory for agricultural emissions to 2040 runs contrary to the potential for the agrifood sector to contribute to climate protection. Various modelling efforts by the Commission and others have shown there is great potential to reduce agricultural emissions if paired with a shift in diets (see Figure 1).
Delayed action now makes EU’s 2050 targets hard to reach
The EU’s 2040 climate target is only an interim milestone in the path towards climate neutrality in 2050, where any remaining GHG emissions are counterbalanced by an equal amount of carbon that is actively removed from the atmosphere. After 2050, the EU has committed to removing more GHG emissions than it emits.
Meeting the 2050 target will require significant GHG emission cuts from the agriculture sector, and pressure to do so from other economic sectors will increase as they decarbonize. The higher EU’s emissions from agriculture remain, the more effort (and expense) will need to occur elsewhere.
To give the sector a planning perspective, we need to have a discussion about what level of residual emissions — the level of emissions we as society consider necessary and acceptable — would be the long-term goal for the sector (see Figure 3). This goal should then inform the reductions needed in 2040.
Delayed action increases the transition risk for farmers
A weaker target in 2040 may look like a positive development for the sector in the short-term, but it does not help prepare the sector adequately for the larger transition that will need to take place.
This is especially the case if governments and/or consumers understand how urgent the climate crisis has become and decide to drastically cut emissions — especially the potent climate polluter methane — in a short period of time, and technical measures no longer suffice.
The Commission’s own modelling highlights that larger GHG emissions cuts would be possible, building on more ambitious food and agriculture policies that allow for a planned transition, alleviating social and economic risk. Failing to do so leaves farmers exposed to a high risk of stranded assets.
2040 climate policy framework should unlock the potential in the agrifood sector
EU leaders agreed to cut emissions within the bloc by 85% by 2040. It’s important to clarify that this 85% cut is the base extent of climate action that must be taken within the EU, not the ceiling.
As more research is done on the feasibility and financial implications of procuring carbon credits from abroad, and as the costs of the industrialized food production system on human health, animal welfare, and the environment continue to mount, Members States may decide that supporting farmers to build a more resilient and climate-friendly farming sector is the better option.
To help unlock the agrifood sector’s climate potential, EU policymakers should:
- Design the 2040 target policy framework to allow for 90% emission cuts within the bloc, with carbon credits remaining optional.
- Mandate that Member States set emission reduction targets for agriculture for 2040 and set out the residual emissions in agriculture for 2050. So far, only few Member States have set climate targets for the agriculture sector, such as Germany in its national climate law as well as the Netherlands and Spain in their national climate plans.
- Provide financial support to farmers to support the transition away from industrial livestock production and towards agroecological and organic farming practices as part of the EU’s next long-term budget.
Footnotes
1 The 30% (and 22%) GHG emission reduction figure refer to 2015 as a base year. As such, they are not directly comparable to the overall 90% (or 85%) net GHG emission reduction target, which refers to 1990 as a base year. Compared to 1990, the modelled GHG emission reduction levels in the agriculture sector come to 45% (and 38%) respectively. The 2015 base year figures are used in this blog because it is the level that the Commission and other climate legislation refer to when discussing sectoral policies.
2 The 22% figure corresponds to the GHG emissions reductions in the agriculture sector implied in the Commission’s S2 scenario which assumes an overall net 85-90% target. The 30% figure corresponds to the S3 scenario accordingly.
