Sustainability, a core value of ForFarmers and intrinsic to its business practices

Demand for food and proteins increases on the back of the growing world population and this demand needs to be met in a sustainable way.  As livestock nutritionists, the animal feed industry has a vital role to play in achieving this by continuously improving both the efficiency of livestock production and the health and welfare of animals. Sustainable production of feed, and consequently food, can only be achieved through continuous innovation. Sustainability, innovation and delivery of concepts are therefore an integral part of ForFarmers’ business practices and operations.

1.4.6.1 Stakeholder dialogue and materiality matrix

In setting priorities for the ongoing improvement of its sustainability performance, ForFarmers regards the view of its stakeholders as a vital starting point. In addition ForFarmers recognises that developing knowledge and trends can influence the agenda. At least once every three years ForFarmers performs a comprehensive survey to gain and measure feedback from its key external and internal stakeholders to create its materiality matrix. In the intermediate years ForFarmers checks the matrix by means of its ongoing dialogues with stakeholders through its normal business practices. Based on the regular discussions that took place in 2018 between advisors and customers, and between other employees and other stakeholders, the existing materiality matrix of 2017 continues to represent the current perspectives of ForFarmers and its stakeholders. Through this structural stakeholder engagement, emerging topics are identified that are important for ForFarmers to take into account in its strategic updates. 

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1.4.6.2 ForFarmers' sustainability strategy

ForFarmers has developed a sustainability framework comprising three themes and six material focus areas of which five are defined as Key Performance Indicators (KPIs). The chosen themes are those on which ForFarmers has an impact within the value chain and together with the formulated KPIs address the key issues raised by its  stakeholders. ForFarmers considers improving animal health and animal welfare as an integral aspect of its Total Feed approach for which no specific KPI has been determined. The table reflects the connection between the themes and the KPIs.

1.4.6.2.1

1.4.6.2.2

ForFarmers has aligned its five sustainability objectives (KPIs) to the primary UN Sustainable Development Goals (SDGs), focusing on ending poverty, protecting the planet and ensuring prosperity for all to be achieved by 2030. In 2018 ForFarmers determined which specific underlying SDG targets are relevant in order to further focus on these targets in 2019.

1.4.6.2.3

¹Although phosphate pollution is not specifically addressed by ForFarmers’ global stakeholders as most material, the Company has included it in its sustainability strategy as it is a material topic for dairy farmers and pig farmers in the Dutch market. Given the importance of ForFarmers Netherlands in the development and results of the Company, this KPI is deemed of essence.
²Although greenhouse gas emissions is not specifically addressed as most material in the materiality matrix, ForFarmers has included it in its sustainability strategy as the other material topics are related to our carbon footprint.
³The explanation is: (+):the results have improved, (+/- ): the results were average , (-): the results decreased

1.4.6.3 ForFarmers' inherent sustainable Total Feed approach

Apart from working on its specific objectives towards the six focus areas, ForFarmers’ Total Feed approach inherently comprises various sustainable concepts, such as non-GMO and organic feeds and, for example, by applying on-farm fermentation.

In 2018 ForFarmers reopened a sizeable mill in the Netherlands (maximum capacity of 250k tonnes) that is fully dedicated to production of non-GMO feed, on the back of the increasing consumer interest for non-GMO food especially in Germany. The interest in non-GMO food, and therefore feed, represents a certain perspective on sustainability. ForFarmers responds to that need by producing such feed in the most efficient way.

Moreover, ForFarmers as the leading producer of organic feed in Europe strengthened its position further in 2018 by taking over Van Gorp Biologische Voeders (the Netherlands and Belgium) and announcing a small take-over in the United Kingdom.

ForFarmers also takes a leading role in helping farmers apply on-farm fermentation for swine, which leads to better digestible feed with a better phosphate utilisation. Moreover, it enables the farmer to use less water in the mix, thus resulting in less manure, also resulting in a lower carbon footprint. The use of fermentation in producing pig feed also improves animal health and consequently reduces the need for antibiotic interference. ForFarmers delivers both the lactic acid producing bacteria and the complimentary feeds to farmers, combined with advice and tools.

DML, one of the core product groups of ForFarmers, comprises co-products from the food and drink industries. Examples include whey, wheat feed and brewers grain. These circular products contribute to a sustainable (re)use of raw materials.

Governance sustainability activities

ForFarmers has a two-tier governance approach to sustainability in the form of a Sustainability Advisory Board, chaired by ForFarmers’ CEO, and a Sustainability Task Force.

ForFarmers excludes companies or businesses acquired during the current and prior reporting period from the reporting scope. The reason behind this is that newly acquired companies or businesses first need to be integrated into the ForFarmers organisation and become familiar with the ForFarmers way of working, before the reliability of the reported figures can be ensured.
More detailed information on ForFarmers’ sustainability strategy (including governance, reporting criteria and KPI definitions) can be found on the corporate website.

1.4.6.4 ForFarmers' sustainability focus areas and related KPIs in more detail

During 2018 ForFarmers made progress in measuring and reporting on the six focus areas. Quarterly updates on all KPIs were introduced, providing explanation for the Executive Committee on performance and achieved results and on the planned actions going forward.

1.4.6.4.1 1. Limit phosphate pollution

Why this is part of ForFarmers’ sustainability strategy

Phosphate pollution is viewed as a relevant focus area as phosphate emission by animals pollutes surface water. The EU has therefore imposed phosphate production ceilings for all EU member states. Given the intensive farming in the Netherlands, Dutch dairy and pig farmers have been permitted a higher phosphate ceiling than other European countries, which is reviewed periodically. In light of the upcoming assessment, measures were introduced in the Netherlands in 2017 to reduce phosphate emissions. These measurements were to be taken by all relevant industry players. Farmers were required to reduce their herds, processors put penalties on milk production above certain limits, and the government provided subsidies to farmers who decided to stop farming and feed companies were challenged to include less phosphate in feed. However, too little phosphate in the feed reduces animal performance; too much increases emissions into the environment. Measuring phosphate efficiency is therefore considered a KPI, and of material importance specifically in the Netherlands.

What was done

ForFarmers influences phosphate efficiency through nutrition by continually focusing on better utilisation of nutrients and the use of the latest generation of phytase enzymes. ForFarmers’ NIC is involved in various test programmes to develop feed concepts that achieve reduction of phosphate emissions.

How progress is measured

In the Netherlands, ForFarmers engages in the ‘KringloopWijzer’ scheme, a nutrient management system for all dairy farmers to record the use of minerals (phosphate, nitrogen and carbon) on farm. ForFarmers delivers feed and tools to farmers to monitor phosphate efficiency on the farm and consequently the relating polluting phosphate losses. The higher the percentage of phosphate utilisation, the better it is. However, it is impossible to reach a phosphate utilisation of 100%. At present, the efficiency for the best 25% performers for dairy cows is on average 42% and for respectively swine fattening 61%, sow 53% and for swine breeder & feeder farms 56%. Phosphate efficiency was generally higher in 2017 than in 2016.

1.4.6.4.1.1

* Comparitive percentages have been updated
The results are always one year behind the current year because of the availability of the data. Considering that (reliable) data which is required for the calculation of phosphate efficiency is only available for Dutch farmers, the scope is restricted to The Netherlands only.
Source: ForFarmers

1.4.6.4.1.2

The 2017 highlights were:

In dairy, phosphate efficiency improved primarily as a result of increased productivity (higher milk yields per cow).  In swine finishing, ongoing work by ForFarmers to optimise the nutritional composition of diets led to improvements in the feed conversion ratio and therefore an increase in phosphate efficiency. More modest improvements were seen in the sow breeding sector due to increases in the number of pigs reared per sow and on swine breeder and feeder farms.  
In 2018, ForFarmers continued to focus on developing innovative feed concepts that help improve phosphate efficiency in the dairy and swine sector, such as the implementation of the Delta concept.

1.4.6.4.2 2. Limit greenhouse gas emissions

Why this is part of ForFarmers’ sustainability strategy

Livestock production causes significant greenhouse gas (GHG) emissions and consequently climate change. ForFarmers therefore monitors GHG emissions (both per tonne of feed and in total), initially within its own operations. This means measuring the use of gas, oil and diesel (scope 1) and electricity (scope 2) in the production of feed and by its own vehicle fleet. This is an area in which ForFarmers can make a difference directly through its own actions, albeit that GHG emissions produced within scope 1 and 2 are minimal in comparison to those produced in scope 3 (emissions produced in the supply chain and emissions on-farm). In order to help farmers lower their carbon footprint, ForFarmers not only focuses on reducing its GHG emissions in scope 1 and 2, but also on delivering its Total Feed solutions, i.e. optimally sustainable feed concepts combined with advice. This includes the use of co-products from the food and drink industries (DML products such as whey, beet pulp, brewers grain, palm kernel) and optimising feed conversion, which means ‘less feed in – and consequently use of scarce raw materials - , more production output’. 

CHALLENGE: trade-off between dedicated non-GMO factory and increase of GHG emissions

In 2018 ForFarmers reopened a mill in Deventer, the Netherlands, fully dedicated to the production of non-GMO feed. Especially within the German market the interest in non-GMO dairy products is on the rise. As the production of Dutch dairy farmers is to a large extent exported to Germany, their demand for non-GMO feed increased significantly. Reopening the mill in Deventer meets this requirement, but leads to an increase in GHG emissions as the distance to be covered from the mill to the customer, as regards delivery of specialities, could be longer.

What was done

As of 2018, GHG emissions of the transport activities performed by ForFarmers’ own fleet is included in GHG reporting to provide a more comprehensive dataset for the supply chain activities.

In 2018 ForFarmers initiated the following main projects to reduce GHG emissions:

Scope 1 and 2

With respect to its manufacturing activities, ForFarmers uses an Energy Saving Matrix that sets out a list of projects in each country targeted to improve energy efficiency, e.g.:  

• In the Netherlands, the construction of a biomass boiler in Lochem commenced. This biomass plant produces steam by using wood chips from local sources. The steam will be used as energy source in ForFarmers largest mill in the Netherlands, also located in Lochem, and is estimated to reduce the mill’s gas consumption by 95% when it is fully operational.
   

• In the United Kingdom, ForFarmers installed solar panels on three mills as well as on its new central office (Horizon House). In addition, LED lighting was installed at eight sites.

ForFarmers also takes measures to improve energy efficiency in logistics (transport). The amount of fuel (in litres) per tonne of feed delivered by the dedicated fleet is measured and reviewed on a monthly basis. Energy efficiency is improved by efficient vehicle planning, which increases utilisation and capacity fill.
ForFarmers also continues to invest in new, more efficient, trucks. For example, at the end of 2018 over 90% of the trucks ran on Euro 6 engines. 
A number of projects have been introduced focusing on reducing idle time, efficient loading with larger trailers and a driver challenge for fuel-efficient driving. In the Netherlands, a pilot on feed delivery using electric unloading is underway and in the United Kingdom vehicle planning has been improved with the introduction of an upgraded vehicle routing system.
The company car policy, which was introduced at the beginning of 2016, encourages employees with company lease cars to choose electric or low CO₂ emission vehicles. In 2018 sixty new cars were leased, of which 11 (18%) are electric or hybrid cars.

Scope 3

At farm level, ForFarmers focuses on reducing GHG emissions by delivering fitting Total Feed solutions. For example, ForFarmers introduced the Apollo range of broiler feeds in 2018, which focuses fully on environmental impact by delivering the best feed conversion efficiency and thus reducing the carbon footprint and use of land. Similarly, the NOVA range of sow feeds, which has been based on extensive research and development to ensure total performance throughout the sow’s reproductive lifetime, helps reduce GHG emissions on farm. In the ruminant sector, ForFarmers is engaged in a project that aims to lower the carbon and methane footprint of feed concepts.

CHALLENGE: developing concepts whilst balancing out the impact on the three themes

Meeting all objectives within the three themes simultaneously is not always possible. For example, limiting GHG emissions and minimizing use of land has a positive effect on the environment but will often decrease the level of animal welfare. Similarly, the best way to reduce carbon footprint and minimize the use of land is to improve the feed conversion ratio and increase the daily weight gain of broilers in a relatively small living-space. This goes against creating welfare concepts that see to improving animal health and welfare. ForFarmers maps such challenges to balance out customer requirements versus impact on the three themes.

1.4.6.4.2.1

The darker the colour green, the more relevant
Source: ForFarmers

How progress is measured

1.4.6.4.2.2

Total tonnes of CO₂ per source all show a minor decrease compared to previous year. This is mainly caused by ongoing implementation of energy savings projects and a favourable raw material mix, which will continue to be our focus for 2019.

The CO₂ per tonne feed, the intensity ratios, also show a minor decrease compared to previous year, except Diesel which remains flat. Despite driver challenge and new trucks, Diesel emissions were the same as last year due to increased litres per tonne as capacity fill was lower and customer distance was higher.

CHALLENGE: measuring the emissions along the value chain

ForFarmers recognises that scope 3 GHG emissions (produced in the supply of raw materials and inbound logistics chain and from the utilisation of feed by its farmer customers) are significant. Measuring these emissions in a comparable and consistent manner remains a challenge however. Without reliable data it is difficult to monitor progress in reducing GHG emissions. To this end the Company is actively involved in European and international initiatives to develop a harmonised methodology for calculating the environmental impact of feed production delivered to the farm gate. In 2018 the European Commission published the Feed for Food Producing Animals PEFCR. Also in 2018, the Global Feed LCA Institute, an independent feed industry initiative, published a freely and publically available Feed Life Cycle Analysis (LCA) feed materials database. These data and tools will make it possible for ForFarmers to calculate the emissions associated with raw materials and provide this information to customers and other stakeholders where there is a market incentive to do so.

1.4.6.4.3 3. Minimise use of the land, water and energy

Why this is part of ForFarmers’ sustainability strategy

Minimising the use of land, water and energy throughout the supply chain is a very important topic for ForFarmers and many of its stakeholders. The issues largely revolve around deforestation and land use associated with growing raw materials that are imported into the EU, particularly soy and palm oil. Various external organisations have taken it onto themselves to ensure responsible business practices are in place and used in this regard. Not only do they focus on responsible procurement practices, but also on environmental and social aspects, such as fair compensation and working conditions for labourers. ForFarmers also assesses the impact of regional sourcing in relation to this KPI.

What is done

ForFarmers aims to be a socially responsible corporation. ForFarmers continues to be committed of purchasing 100% soy bean meal and palm oil. Having considered the impact of the addition of Tasomix in Poland, ForFarmers now aims to achieve this objective by 2025. The appropriate target for Tasomix will be determined during 2019.

The Company is a member of the Round Table on Responsible Soy (RTRS) and the Roundtable on Sustainable Palm Oil (RSPO) and was actively involved in the development of the European Feed Manufacturers' Federation (FEFAC) soy sourcing guidelines published in 2015. Together with FEFAC, ForFarmers continues to engage with both upstream and downstream supply chain partners to raise awareness of the guidelines to facilitate the mainstream supply responsible soy into Europe. 

The 2018 highlights are:

• 74.8% of soy meal and 70.0% of palm oil purchased according to ForFarmers sustainability criteria;

• ForFarmers Netherlands and Belgium already source 100% responsible soy

• Active participation in developing new industry initiatives (e.g. UK Round Table on responsible soy) to drive sector adoption and create level playing field

• Pilot of new feed schemes (i.e. soy free diets) to address requirements from national markets

ForFarmers’ commitment to sourcing according to recognised environmental, social and ethical standards is being extended to include all raw materials, through a structured dialogue with suppliers and the Sedex supplier code of conduct (‘Sedex code’), which was implemented in 2017. The Sedex code sets out shared responsibilities with suppliers on responsible sourcing. It comprises a number ofminimum criteria that suppliers of ForFarmers must meet. ForFarmers will only source products and services from companies that comply with the rule of law and that are actively working towards meeting the Sedex code requirements. Relationships with suppliers who do not agree to work according to the Sedex code will be phased out or immediately discontinued. 

The Sedex code includes standards on business ethics to prevent bribery, corruption and fraudulent business practices. Policies and procedures relating to employment practices comply with the provisions of the relevant ILO (International Labour Organisation) standards. Of the product-related procurement spend in 2018, more than 81% of the suppliers had signed either the Sedex code or a supplier’s code of conduct (2017: over 70%). Of the non-product related procurement spend in 2018, over 34% of the suppliers had signed a code, representing more than 57% of the annual spend. This will remain a focus area for 2019.

CHALLENGE: Regional sourcing: it is more sustainable?

A number of initiatives are underway to increase the volume of feed materials grown in Europe.  In November 2018, the European Commission published its Report on the development of plant proteins in the European Union.  These initiatives are driven by concerns over the degree to which the livestock industry depends on imports for high protein materials such as soy (95% soy is imported into the EU).
ForFarmers recognises the concerns. European soy, however, is of lower quality because the growing circumstances are not as good as close to the equator, needs more water and regional growth uses more energy leading to a higher carbon footprint, all despite shorter transport distances. ForFarmers is also working on protein replacers to reduce the dependency on soy. However, many of the current alternatives increase the environmental impact of livestock production rather than improving it. For instance, some protein replacers lead to increased phosphate emissions.  In addition, all current options increase costs for the farmer if the same level of performance is to be achieved, and consequently lead to higher prices for consumers.

How progress is measured

Although percentages were slightly lower than in 2017, they remain in line with ForFarmers ambition.

Water

ForFarmers focuses on reducing water usage both in its own operations and downstream in the value chain. Moreover, through its principle to source responsibly, ForFarmers aims to reduce water usage in the supply chain. In the production process water is used for to generate steam for the extrusion process. ForFarmers realises that a balance needs to be achieved between the use of steam and electricity consumption in the manufacturing process. On-farm, ForFarmers’ focus is to help farmers to reduce water consumption associated with livestock production by improving efficiency. The trend toward lower crude protein diets also reduces water consumption by livestock. 

1.4.6.4.4 4. Ensure safe and good working conditions

Why this is part of ForFarmers’ sustainability strategy

ForFarmers considers providing a safe and good working environment for all employees, temporary contracted staff, contractors and visitors as a prerequisite for being a socially responsible corporation.

What is done

In 2018, a new IT system was implemented, dedicated to recording Lost Time Incidents (LTIs). This system facilitates the root cause analysis of LTIs, after which mitigating actions are defined to prevent similar incidents from happening in the future. All LTIs are notified to the Executive Committee of ForFarmers within 24 hours after the incident was reported. The LTIs are discussed during each Executive Committee meeting. Health and safety is managed through Health and Safety Officers in each country who coordinate training and sharing of best practices. 

Projects are in place to improve site leadership and operator behaviour on safety. 

ForFarmers is committed to not only ensuring the safety of people within our own organization, but also the people, processes and products throughout the entire supply chain aiming for fair and good working conditions. This is also addressed in the Sedex code of conduct for suppliers.

CHALLENGE: the balance between health and safety and customer relationships

ForFarmers deems it its responsibility not only to safeguard the health and safety of its employees but of all its stakeholders. With respect to its own employees, ForFarmers has implemented various programmes to increase awareness and consequently instigate behavioural change regarding safety. These programmes stretch from activities in the ForFarmers locations to situations on-farm and on-the-road. Accordingly, ForFarmers will discuss any risks that have been identified on-farm with the customer and recommend the remedial action(s) to be taken. In the event the customer does not respond within the agreed timeframe, ForFarmers stops supplying feed.  This puts a strain on the balance between health and safety and customer retention.

In line with its objective to act as a socially responsible corporation, ForFarmers supports a number of agricultural charities which link to the development and well-being of our people and society. These include the Agriterra project which enables employees to engage in initiatives aimed at helping develop the entrepreneurial skills of farmers in developing countries. In 2018 three ForFarmers employees took part in projects in Ethiopia, Kenya and in the Philippines.
In addition, ForFarmers supports the Farm Fresh Revolution in Staffordshire in the United Kingdom. This project provides access to fresh produce with nutritional and cooking advice to children and parents. The Run4Life charity, an EU-funded project aimed at creating low-impact fertilisers through nutrient recovery of human waste streams is also supported by ForFarmers.
For many years already, staff and customers from all ForFarmers operations support the initiative to participate in the Alpe d’Huzes event which is a Dutch initiative to raise money for cancer research, with a team from the agricultural sector. ForFarmers participates each year under the brand name BIG Challenge.

How progress is measured

ForFarmers focuses on monitoring the LTIs only. The results are not only disclosed in the Annual Report, but also shown on monitoring screens outside of a number of the local offices. The objective hereof is to enhance awareness amongst employees and visitors on this topic.

Source: ForFarmers

ForFarmers sadly suffered a fatality in January 2018 in the Netherlands, when a driver was struck by a falling branch during an extreme storm.

All countries except the Netherlands showed higher LTIs compared to previous year. 31% of sites did not incur any LTIs during 2018. This is a reason to believe a zero LTI culture is achievable.

A higher number of LTIs can partly be attributed to a higher number of LTIs and near misses that have been recorded in recent years as more and more attention is paid to health and safety. Despite the increased focus on and investments in Health & Safety the number of LTIs remains too high. ForFarmers will continue to dedicate more efforts to increase awareness on safety issues and to bring about a greater sense of urgency and responsibility of managers and employees to lead by example. In addition, the Company will continue to invest in safe(r) mills and transport.

1.4.6.4.5 5. Improve feed safety

Why this is part of ForFarmers’ sustainability strategy

ForFarmers is part of the food supply chain and consequently considers feed safety as a prime responsibility. All incidents of non-compliance with feed regulations and voluntary codes are proactively monitored and managed. ForFarmers aims for zero incidents.

What is done

The main focus in 2018 has been to further improve mill hygiene and pest control. Additional internal quality checks have been introduced to check progress.
ForFarmers takes a Group-wide (One ForFarmers) approach to HACCP (hazard analysis and critical control points). Feed materials and compound feeds are continuously monitored to determine unwanted substances as defined by EU legislation, GMP+, Ovocom, Feed Chain Alliance and UFAS regulations, the SecureFeed monitoring plan and ForFarmers’ own risk analyses. Non-compliance is determined by the relevant competent authorities, external certification bodies and third party audits (often by retailers) in each country via inspections and external audits.

In the United Kingdom there is an “earned recognition” agreement between UFAS and the regulator (the Food Standards Agency). As a result there is a different emphasis to risk analysis compared to the Continent where the national control authorities take a more proactive role. ForFarmers quality managers determine whether non-compliance is linked to feed safety. The Group Quality Manager then validates this. Any non-conformance is corrected within the timeframe agreed with the inspector or auditor.

1.4.6.4.5.1

How progress is measured

Source: ForFarmers

1.4.6.4.5.2

ForFarmers achieved a significant reduction in the total number of feed incidents in 2018 compared to 2017. The main issues raised by governmental and external audits relate to mill hygiene, pest control and label non-conformances. Corrective actions have been put into place to optimise the process by which labels are created and additional internal checks are now conducted to monitor pest control and mill hygiene at site level.

1.4.6.4.6 6. Improve animal health and welfare

Why this is part of ForFarmers’ sustainability strategy

ForFarmers’ core focus is to ensure that each animal receives the correct level of nutrition to meet its basic needs. ForFarmers’ customers use many different production systems, both intensive and extensive, conventional and organic, indoor and outdoor and on a small and large scale. It focuses on optimising resource efficiency and animal health and welfare in each of these production systems.

What is done

Specific concepts are developed aimed at helping customers mitigate the impact of specific legislative requirements such as the ban on de-beaking hens or the castration of pigs. Particularly in the Netherlands, where retailers no longer offer products from fast growing chickens, welfare concepts were developed for broilers.

Each innovation project is assessed on its impact on animal health and welfare and on other sustainability impacts as has been illustrated earlier.

Examples of innovation projects in 2018 aimed at improving animal health and welfare include:

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Source: ForFarmers

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How progress is measured

Improving animal health and welfare is an integral part of the ForFarmers Total Feed approach. Given the different species and broad spectrum this covers, it is not yet possible to define and monitor improvements in animal health and welfare in a consistent and meaningful manner. ForFarmers continues to search for a constructive method to measure progress on this topic in 2019.

Anti-Microbial Resistance

Anti-Microbial Resistance (AMR) is one of the great challenges to both human and veterinary medicine as a number of bacteria are no longer responsive to antibiotics. The European Commission includes the role of nutrition in its AMR action plan. ForFarmers looks for nutritional solutions to help customers and their vets reduce the quantity of antibiotics used in livestock production. In the United Kingdom, ForFarmers organised a series of workshops in conjunction with AHDB (Agriculture and Horticulture Development Board) to help customers achieve the reductions in antibiotic use set by the Government. These were attended by over 100 farmers in 2018.