New
Persefoni AI named a leader in Sustainability Management Software
Read the report
All Posts
/
Insights

Food & Beverage Carbon Footprint: Emissions Profile Insights

Share:
Article Overview

The food and beverage processing sector is not just an economic giant — it is on the frontlines when it comes to global warming. The industry is a significant driver of GHG emissions. It is also highly vulnerable to risks posed by climate change: Many businesses, especially in agriculture, are already feeling the effects of severe weather, disruptions, and disasters. 

For these companies, decarbonization is an urgent imperative — and it begins with understanding where their greenhouse gases are coming from. To establish a baseline picture of emissions in this sector, Persefoni analyzed data from the CDP (formerly Climate Disclosure Project, the largest database of global climate reporting. 

Below, we’ll take a look at the emissions profile of the food and beverage processing industry, opportunities for reductions, and steps companies can take to get started in comprehensive carbon accounting.

What is a Carbon Emissions Profile, and Why Does It Matter?

An emissions profile serves as a starting point for carbon accounting

An emissions profile provides a snapshot of the greenhouse gas emissions a company or sector releases, with details on material sources and amounts. It serves as an initial guide that allows you to see which business activities contribute to your company’s carbon footprint, and understand the financial and operational data you’ll need to collect in order to complete robust, audit-grade carbon accounting. 

For food and beverage processing, emissions typically come from a variety of sources up and down the value chain, including agriculture (cultivation of crops and livestock), refrigeration (specifically hydrofluorocarbons — HFCs — which have a high global warming potential), the transportation of goods, and the production and disposal of packaging. 

We’ll dig deeper into the emissions profile for this sector later in this article.

food an beverage reported risks

Key Trends Affecting the Food and Beverage Sector

Regulations, consumer behavior, and stakeholder concerns create new challenges for companies.

For food and beverage producers, the focus on climate change isn’t just about meeting consumer and investor demands for sustainability — it’s about the future of the industry. Climate-related threats are on the rise. Droughts are reducing land arability, fish mortality is increasing due to rising sea levels and ocean temperatures, and extreme weather threatens to disrupt the transport of goods. As the World Economic Forum has warned, these challenges can lead to rising food prices and increased food insecurity — jeopardizing the entire planet. 

Other climate trends affecting the sector include: 

What Does the Emissions Profile Look Like for the Food and Beverage Processing Industry?  

A complex series of processes add to the industry’s climate footprint.

From the day a farmer sows a seed in the soil to the moment a drink bottle gets recycled at a plant, a complex series of processes take place — each contributing to the total emissions of the food and beverage processing industry. 

Within this cycle, there are several major drivers of the industry’s climate footprint: 

  • Purchased Goods and Services: Purchased goods and services take the lead in the industry, accounting for 66% of total emissions, according to Persefoni’s analysis of CDP data. This segment encapsulates everything from the raw materials bought for food production, like grains or fresh produce, to the services utilized. Ninety-eight percent of food and beverage companies reported purchased goods and services as part of their CDP disclosures — demonstrating just how relevant this category is to the industry’s emissions profile. For example, producing a bottle of orange juice starts with the use of water, fertilizers, and pesticides to grow oranges. Next, energy from various sources powers the juicing and pasteurizing processes, as well as the production of bottles to hold the juice. 
  • Scope 1 (Direct) Emissions: These emissions result directly from a company’s operations, and rank second in the industry’s profile. Their predominant sources are fossil fuel consumption in vehicles and on-site machinery. The not-so-obvious yet significant contributors here are fugitive emissions from refrigeration—critical in food cold chains. Large-scale cooling systems, if not maintained, can release potent greenhouse gases. Together, the use of the company fleet, the operation of equipment that consumes fuel, as well as the leakage of refrigerants from cooling equipment all contribute to scope 1 emissions.
  • Scope 2 (Indirect) Emissions From Purchased Electricity: In food and beverage processing, scope 2 emissions are typically driven by the consumption of purchased electricity to power equipment used in cooking, processing, packaging, and storage of food and drinks.
  • Transportation and Distribution: A web of travel and logistics brings food and beverages to our tables. Together, upstream transportation (paid for by the reporting company) and downstream transportation (paid for by customers and end consumers) contribute to 9% of the industry’s emissions profile. The nature of the product can heavily influence these numbers. For instance, frozen foods requiring expedited air freights or temperature-controlled shipments can push up these emissions, as would a wine manufacturer in France that exports bottles around the world. 
  • Waste: A sector as vast and diverse as food and beverage inevitably grapples with waste from operations. Globally, 13% of the food produced is lost between harvest and retail each year (UN, Food Loss and Waste Reduction) Food waste is a significant contributor to emissions, as it turns into methane, which has high global warming potential. Food waste also carries significant environmental and reputational implications. As consumers shift to eco-conscious choices, waste management practices, or the lack thereof, can affect a company’s credibility and brand. 

Below is a breakdown of average emissions sources in the sector, according to Greenhouse Gas Protocol scopes: 

food and beverage processing emissions profile

What are the Challenges in Calculating Emissions?

A complex value chain and lack of granular data in the food and beverage industry create hurdles.

For food and beverage companies, determining emissions can be daunting. The value chains in this industry are highly complex, and it’s often difficult to source the granular data that can reveal emissions hotspots and opportunities. As a result, many companies are reluctant to engage in carbon accounting. 

Several resources are now available to support the process. For example, companies purchasing raw products from farming frequently rely on either data reported by farmers or on spend-based data and industry averages. To improve accuracy and ease carbon accounting, trade associations, and industry groups in the sector have collaborated to create deep public databases with information on average emission factors that can be used to support analysis. 

The Science Based Targets initiative (SBTi) has also published new guidance specifically for this sector. The Forest, Land, and Agriculture (FLAG) framework provides a roadmap for companies linked to land-intensive sectors — like food and beverage processing — that need to set science-based emissions targets. At the same time, emissions calculation methodologies are becoming more standardized. The GHG Protocol’s Land Sector Guidance, released in 2023, aims to improve data fidelity. 

What’s Next? Calculating and Managing Emissions 

A guide to getting started.

Food and beverage processing companies that are calculating their emissions for the first time can start by engaging with suppliers and customers to get an understanding of the data that’s available and identify concrete steps that will aid in managing emissions. Industry and trade associations can also be helpful for tapping into existing lessons and best practices — there’s no need to start from scratch. 

Data Requirements, Sources, and Owners

As a first step, it’s helpful to get a sense of the data you’ll need to collect for your comprehensive carbon footprint. The table below shows typical data requirements, sources, and owners in the industry — and can serve as roadmap for aligning the information you seek with your organization's existing resources. 

Getting Started With Supply Chain Analysis

Prioritize hot spots, gather data, and communicate your findings.

Getting reported data from all your suppliers can be challenging, particularly in an industry with highly fragmented — and in many cases decentralized — supply chains. We recommend taking a step-wise approach, targeting the data you can most easily obtain, and focusing on your largest suppliers or those with the most significant emissions. Here are three steps to get started: 

Step 1: Prioritize suppliers. Identify high-impact suppliers who are critical to your scope 3 emissions. Start with suppliers who make up the lion’s share of your spending, or who come from emission-intensive industries like meat and dairy. Outline what you expect from your suppliers and how they stand to benefit from communicating their emissions data.

Step 2: Gather data. Carbon accounting technology will facilitate the gathering, monitoring, and verification of data within your supply chain — increasing transparency and eliminating miscalculations. For example, Persefoni’s free carbon footprint software, Persefoni Pro, streamlines the collection of granular emissions data from suppliers, helping companies move away from spend-based estimates towards a higher percentage of reported data based on actual activity. The platform cuts down on the need for back-and-forth, enhancing efficiency, lowering operating costs, and accelerating progress on climate goals. 

Step 3: Communicate your findings. Once data is verified, it’s time to assimilate it into your overall emissions profile and communicate your findings and insights with suppliers. Ideally, this will become an ongoing and recurrent activity resulting in continuous improvement and reductions.

An Industry at a Crossroads

Decarbonization can’t wait.

The food and beverage processing sector is at a crossroads. Given its significant contribution to climate change — and the existential risks it faces as a result of the climate crisis — the industry urgently needs to decarbonize. The first step is for companies to calculate their emissions, which can get highly complex. Fortunately, there are resources to help — new guidance from the SBTi and the Greenhouse Gas Protocol provides a roadmap. You can also tap into industry associations, customers, suppliers, and other partners for best practices and methodologies that help decode the process. Finally, carbon accounting software can make calculating your emissions more efficient and effective, by facilitating communication with suppliers and ensuring data is traceable, transparent, and reliable. 

Ready to calculate your emissions? Find out more about Persefoni’s AI-powered carbon accounting tool.

Share:
Get the latest updates straight to your inbox.

Sign up for our newsletter and stay ahead of the curve.
With every edition, you'll receive the latest news, updates, and insights from our experts, straight to your inbox.

Related Articles

Insights
·
Tuesday
April
 
16

The Global Convergence of Climate Change Disclosures

Explore the evolving landscape of climate disclosure and discover key frameworks and regulations shaping the future of sustainability reporting.
Insights
·
Wednesday
April
 
17

CSRD: A Guide to the Corporate Sustainability Reporting Directive

What Is the CSRD? It is a new EU legislation that will expand sustainability reporting requirements and increase the number of companies mandated to report.
Insights
·
Monday
April
 
15

Transitioning From TCFD to ISSB: What you need to know

Learn more about the transformative shift from TCFD to ISSB standards in climate reporting, shaping global disclosure practices for businesses.