PepsiCo & Griffith Foods Boost Brazil's Regenerative Farming

PepsiCo has initiated a direct farmer incentive scheme in Brazil’s Cerrado region, a move that could fortify the security of key food and drink supply chains.

The pilot programme, a partnership with ingredients company Griffith Foods and corn specialist Milhão, is designed to speed up the adoption of regenerative agriculture.

It applies a hybrid model of “Payment for Practice and Payment for Outcomes” to promote sustainable farming practices in a crucial agricultural area for the global food system.

Financial incentives for sustainable ingredients

The initiative begins on a 7,000-acre area with ambitions to expand to 30,000 acres within three years, a scale equivalent to PepsiCo’s entire corn sourcing volume in the region.

This is particularly relevant for the food and drink sector as the Cerrado produces substantial amounts of corn and more than 60% of Brazil’s soybeans but is currently facing challenges from deforestation, soil degradation and climate stress.

A total investment of US$1m supports the scheme, providing upfront financial assistance to farmers.

This is intended to offset the costs associated with transitioning to practices such as composting, using biological inputs and reducing the application of chemical fertilisers.

The model also includes performance-based bonuses linked to lower agrochemical use during the growing season, directly impacting the inputs used to grow ingredients destined for the food chain.

"This program tackles one of the biggest barriers to the adoption of regenerative agriculture: the financial risk farmers face when transitioning to new practices," says Thais Souza, Sustainability Lead at PepsiCo Brazil. 

"By providing direct economic incentives, we're helping facilitate outcomes such as improved soil health, reduced greenhouse gas emissions and climate resilience."

For a food and drink manufacturer like PepsiCo, the Cerrado is a high-impact sourcing area, making the pilot strategically important for both supply security and the resilience of its farm-level suppliers.

Pre-competitive collaboration in the food system

This initiative is an example of how companies that may otherwise be competitors can collaborate pre-competitively to achieve shared sustainability goals and promote systemic change.

The work aligns with PepsiCo’s goal to spread regenerative practices across 10 million acres by 2030.

It is guided by PepsiCo’s Climate Resilience Platform, an open-access tool designed to help agricultural stakeholders plan for and mitigate climate risks.

"At Griffith Foods, we see this collaboration as part of our journey to help nourish the world and transform the food system, an essential part of the climate equation that demands both courage and collaboration,” says Nicholas Costa, Regional Sustainability Director Griffith Foods Central and South America.

“Guided by our 2030 Aspirations, we're turning that vision into action by moving beyond 'do no harm' thinking to embrace a regenerative mindset that restores soils, strengthens communities and proves that business can truly be a vehicle for greater good.

"This collaboration shows how science, innovation and shared purpose can turn ambition into a positive impact and help nourish both people and the planet. 

“By sharing costs and aligning on sustainability ambitions, PepsiCo, Griffith Foods and Milhão are demonstrating how competitors can work together pre-competitively with the aim of helping drive systemic change."

A blueprint for future food production

According to the UK Government, regenerative agriculture is a farmer-led movement aiming to improve water quality, mitigate climate change, produce profitable food and drink and enhance biodiversity and soil health.

The core principles focus on reducing soil disturbance and reliance on chemicals in favour of improving soil health.

This approach ultimately contributes to healthier ingredients and finished food products.

The collaboration between PepsiCo, Griffith Foods and Milhão demonstrates how sharing costs and aligning on sustainability targets can lower the financial risk for farmers moving to regenerative methods.

"This is more than a pilot, it's a blueprint for efforts to transform agriculture in one of the world's most critical regions," says JP Cavalcanti, Sr Director, Market Supply Officer PepsiCo Brazil Foods. 

"We're proud to lead this effort and invite others to join us in scaling regenerative solutions that can benefit farmers, ecosystems and food systems."