Report Launch: The US$842 billion opportunity for food and climate

New report sets out how governments can use “immense financial lever” of agricultural subsidy reform to tackle climate change and fix broken food systems.

ANTALYA, TURKEY, November 9, 2026 /EINPresswire.com/ -- Governments around the world are pledging to tackle climate change while spending billions of dollars on agricultural subsidies that undermine their own climate goals. That’s according to a new report that shows how governments can redirect this spending towards more just and sustainable farming – and overcome the political opposition hindering reform.

The report, released at the UN COP31 climate talks by a group chaired by former Costa Rican President Carlos Alvarado Quesada and convened by Dutch think-and-do-tank Clim-Eat examines how governments can make better use of the US$842 billion spent annually on agricultural support.

According to the report, Unlocking a Just Transition in Public Support to Agriculture, some agricultural subsidies are directly at odds with governments' climate commitments, encouraging excessive fertiliser use and farming practices that increase greenhouse gas emissions and harm the environment.

The authors – who include leading scientists, researchers, policymakers, and philanthropic and NGO leaders – suggest that redirecting this spending could help cut emissions, protect nature, strengthen food security and improve rural livelihoods, without necessarily increasing public expenditure.

While acknowledging that the case for reform is already well established, the report focuses on the political interests and institutional barriers that have repeatedly stalled progress, setting out 10 practical strategies for overcoming them.

Published by the High-level Panel for Just Rural Transition, the report argues that the benefits of reform are already widely recognised. The real challenge is overcoming the political interests and institutional barriers that prevent governments from acting. As a result, the launch of the report will mark the start of a year-long campaign to secure commitments from governments, policymakers and agricultural sector leaders to reform environmentally harmful agricultural subsidies by COP32.

“At a time when governments are under enormous financial pressure, we have an opportunity to rethink how we use the resources already available,” said Carlos Alvarado Quesada, former President of Costa Rica and Secretary-General elect of the Climate Vulnerable Forum and CVF-V20 Finance Ministers.

“We don't necessarily need to spend more. We need to spend better, guided by a goal that everyone can support: healthy, nutritious, affordable and sustainably produced food for all. The challenge is to build the political support needed to make that happen, while protecting smallholder farmers and people.”

“Reforming agricultural subsidies is an immense financial lever hiding in plain sight,” said Dr Sonja Vermeulen, Clim-Eat Senior Adviser and lead author of the report “Redirecting existing spending could unlock billions for climate action, empowering small-scale food producers to build resilience, protect nature and cut emissions – which will amplify the power of urgently needed international climate finance.”

Why governments keep paying for the problem

The report identifies political resistance as one of the main reasons governments continue subsidising practices that undermine their climate commitments. Subsidies deliver immediate, visible benefits to farmers, agricultural businesses and input suppliers, who have strong incentives to defend them. The environmental costs, meanwhile, are spread across society and often take years to become apparent.

In Malawi, for example, fertiliser subsidies have remained politically popular despite concerns about their cost, effects on soil fertility and long-term sustainability. But removing subsidies without adequate preparation can be equally problematic. In 2021, Sri Lanka abruptly banned synthetic fertiliser and pesticide imports without adequate alternatives. Yields fell, food prices rose and public opposition intensified.

The examples illustrate the difficulties governments face: maintaining environmentally harmful subsidies can be costly, but poorly planned reforms can have serious consequences.

Breaking the political deadlock

Rather than simply making the case for agricultural subsidy reform, the report identifies ten strategies for overcoming the political obstacles that have repeatedly stalled progress. These include building coalitions of farmers, businesses and environmental organisations to support change; compensating those who stand to lose existing subsidies; and giving farmers credible alternatives before withdrawing support.

The report also recommends reforms that can help countries respond to economic and environmental crises, improving coordination between government ministries and introducing changes gradually through predictable, multi-year plans.

"The case for repurposing agricultural subsidies has been widely accepted but political barriers remain,” said Dhanush Dinesh from Clim-Eat. “What has been missing is a practical way through the politics. Farmers need to know what will replace existing support and how they will benefit. Without credible alternatives, even sensible reforms can face strong opposition."

Three ways to redirect agricultural support

The report outlines three approaches:
1. Reward better farming. Replace poorly targeted input subsidies with incentives for more efficient fertiliser use, healthier soils and farming practices that reduce emissions.
2. Invest in agricultural services. Shift spending towards agricultural research, irrigation, rural roads, extension services and climate information, benefiting whole farming communities rather than individual recipients.
3. Support vulnerable households directly. Redirect some production subsidies towards cash transfers, school feeding programmes and other measures that tackle poverty and food insecurity.

Several countries are already demonstrating the potential of these approaches.

In Brazil, subsidised credit is helping farmers restore degraded pastures, improve manure management and integrate crops, livestock and trees. Costa Rica pays landholders to conserve and restore forests, with more than 1.3 million hectares covered by agreements under its Payments for Environmental Services programme by 2023. In Vietnam, initiatives promoting lower-carbon rice production have cut spending on seeds, fertilisers and chemicals by 25%, while increasing farmers' net profits by 30%, according to the report.

Together, these examples illustrate how public spending can support agricultural productivity while delivering environmental benefits.

From COP31 to COP32

The report's launch marks the start of a year-long campaign to secure commitments from governments, policymakers and agricultural sector leaders to reform environmentally harmful agricultural subsidies by COP32.

The stakes are particularly high for climate-vulnerable countries, where extreme weather, rising input costs and limited public budgets threaten food production and rural livelihoods. But the challenge is global. Governments in wealthy and developing countries alike face difficult choices about how to support farmers without undermining their climate commitments.

By COP32, the campaign aims to see those choices translated into concrete commitments to reform – shifting the debate from what governments could do with agricultural subsidies to what they are prepared to change.

Donna Bowater
Marchmont Communications
donna@marchmontcomms.com