How agricultural innovation is driving resilience

The impacts of climate change have hit Australian farmers hard for years. With no choice but to adapt, the agricultural sector is innovating to reduce emissions, improve efficiencies and drive resilience.

“Across Australia, climate change is already dramatically affecting regions, farms and companies, with increases in temperature, changes in rainfall patterns and extreme rainfall events, droughts and the impacts on coastal areas of storm surges,” says University of Melbourne Professor Emeritus and internationally recognised climate scientist David Karoly. “In 2024, for the first time for any 12-month period the global average temperature was above the 1.5°C goal.”

That record doesn’t technically breach the target of the Paris Agreement, but “it indicates global warming has accelerated rapidly over the past few years and it’s going to get worse”, he adds.

In August, the federal government announced a $1b boost for the Regional Investment Corporation, broadening its scope to include assistance for improving climate resilience and supporting agriculture as part of the energy transition.

But those with the most to lose haven’t waited around for regulations. “Climate change has been negatively impacting farmers for years,” says Natalie Collard, CEO of Farmers for Climate Action. “Our mission is ‘farming forever’. We’re about making the evolution we need in order to successfully navigate climate change and reduce its impact on future generations.”

The registered charity began with 30 farmers in 2015. It now has more than 8400 farmer members and over 80,000 community supporters. Its 2023 survey of some 700 farmers found 55 per cent viewed climate change as the greatest threat to the future of farming in Australia, followed by increasing bureaucracy and red tape (15 per cent).

“We’ve got farmers already producing carbon-neutral beef and we found 71 per cent of them have invested their own money in emissions reduction, because it’s good business,” says Collard.

Making climate-friendly changes

Mitigation measures include electrifying farming equipment, implementing regenerative practices and planting trees, restoring and revegetating land and investing in soil-carbon sequestration projects. Farmers are also reaping rewards from solar and wind renewable energy schemes in addition to the income stream from hosting panel arrays or turbines on their properties.

“A lot of farmers are adopting regenerative practices and we’re seeing a huge move towards on-farm renewables,” says Collard.

“They’re also finding benefits for farm productivity when the solar panels are raised a few metres above the ground, allowing sheep or cattle to graze underneath them and make use of the shade,” says Karoly. “They get heat protection in the middle of the summer and the more diffuse sunlight in the areas beneath the panels leads to improved grass production for grazing.”

As an example of value-add, Collard says sheep farmer Tony Inder is getting better wool quality from the animals that graze under the panels at his Wellington, NSW farm. “They get the shade and the condensation runoff creates thicker grass so they get a better diet. So there are animal welfare benefits. Farmers only host renewables if they choose to — and there are lots of wins.”

Karoly is blunt about the urgency to reduce greenhouse gas emissions, as many rural and regional renewable energy projects are now helping to do.

“It’s not possible to limit global warming to 1.5ºC now, we aren’t even on the right track,” he says. “To get to net zero emissions before 2050, we need to dramatically reduce emissions as quickly as possible and bring in new technologies such as direct-air capture, and carbon capture and storage to suck carbon dioxide from the atmosphere.”

It requires will, effort and investment. “We have hope and we know how to fix it,” adds Karoly. “Australia has more opportunities to generate electricity from solar and wind than any other country in the world. In our farming communities we’ve seen massive transitions to zero-emission technologies such as solar panels and wind turbines — and more recently, plans for offshore wind farms in the continental shelf regions. In my view, we’ve got to stop the use of fossil fuels for electricity generation and transport, and harness renewable energy sources.”

Karoly notes increasing demand for clean energy can be a business opportunity.

“The corporate sector can make money. Private investment in adaptation to climate-change impact is also critically important,” he says. “We need to plan for increases in temperature and heatwaves, increases in extreme rainfall and flooding, extra erosion on coastal areas, all due to ongoing climate change.”

Here are three examples of rural and regional companies and individuals just getting on with it.

CASE STUDY #1 Loam Bio, Orange, NSW

Carbon is the foundation of healthy soil, helping structure, water retention and nutrient availability for crop growth. Biotech startup Loam Bio has produced a seed treatment that helps crops store more stable soil carbon, simultaneously improving yields and locking away atmospheric CO2, a greenhouse gas.

In 2019, the company was spun out from not-for-profit agricultural research institute SoilCQuest 2031 to commercialise the technologies that its founders had been researching since 2012. This tech built on the research of University of Sydney Professor Peter McGee, who found that microbial fungi increases both the volume and stability of carbon in agricultural soils. It captured the imagination of many investors. Loam Bio has since raised $150m in capital from the likes of Lowercarbon Capital, Grok Ventures, Wollemi Capital and the Clean Energy Finance Corporation.

After years of trials in labs, glasshouses and the field, 2025 saw the third season of wheat, barley and canola crops treated with Loam Bio’s CarbonBuilder inoculum seed on Australian farms.

“CarbonBuilder is a world-first microbial seed treatment that not only sequesters CO2 from the air and into soil as stable soil carbon, it can also boost crop yield and water retention,” says Catrina Matheson AAICD, director of marketing and communications at Loam Bio. “Farmers apply the CarbonBuilder seed treatment before planting and as the plant grows, those fungal spores create hyphae [fungal filaments] from the roots of the plant into the soil, and those hyphae transform CO2 into stable soil carbon.”

Loam Bio’s SecondCrop service helps customers to set up carbon farming projects to realise credits from the Australian Carbon Credit Unit (ACCU) scheme.

“Farmers are telling us it works — we’re already seeing year-on-year improvements in soil testing with our growers who are in carbon projects,” says Matheson. “There’s a return on investment for years to come. Farmers who are building stable soil carbon are building a legacy.”

CASE STUDY #2 Impact Ag, Armidale, NSW

“We are reimagining the future of agriculture,” says Hugh Killen MAICD, CEO and managing director of investment and asset-management firm Impact Ag Australia. “We work to deliver strong farming returns at the same time as bringing strong returns for the natural-capital balance sheet, which is around regenerating landscapes, supporting biodiversity and unlocking solutions on the farm to support climate-related objectives.”

Formed in 2009, Impact Ag today runs farms worth $500m on behalf of investors and advises operations worth another $500m.

“We manage 26 properties from Bundaberg in Queensland down to Cootamundra in southern NSW,” says Killen. “A mix of permanent plantings, tree crops such as macadamias and pecans, and everything in between, including broadacre farming, mixed farming, sheep and cattle. The net asset value of farms in Australia is very high. We need to rethink the ‘family farm’, because some are now very significant economic enterprises.”

Killen explains how Impact Ag’s stewardship boosts both balance sheets, deploying strategies positive for farming productivity, as well as nature- and climate-related objectives. “If I manage a farm well, that inherently builds soil carbon on that farm. Plus, in Australia we have this beautiful mechanism around ACCUs. I can get paid an economic dividend for building soil carbon. I can also do the same thing in biodiversity and environmental plantings.

We stack those things on top of each other for a higher overall return to that farm and the agricultural enterprise, as opposed to running a farm in the traditional way.”

Impact Ag’s investor client base is largely single-family offices. “These are high-net-worth family offices with significant capital,” says Killen, adding they’re starting to work with institutional investors, but the family office approach is better suited to this kind of agriculture. “They generally invest over a very long time horizon, which is what you need in agriculture, whereas institutional capital is much faster-moving. With our farming enterprises, we try build natural capital value on the farm. A soil-carbon or environmental planting project has 20- to 25-year horizons — well-suited to the patient long-term capital of family offices.”

The regulatory framework around agriculture, including the ACCU market, makes it compelling for “directors to think about what role agriculture can play in that decarbonisation journey”, he says.

“Agriculture has a really important part to play in feeding people high-quality food and clothing them in good fibre. But it can also absorb carbon, rebuild the environment. It can keep water clean, it’s involved in nutrient recycling and planting biodiversity and it can look after wildlife. All of this can be done within corridors on existing farms. Plus, a stream of high-integrity ACCUs can come out of the back of it. Australia is in a unique position to grab the future.”

CASE STUDY #3 Thorpe Farm, Bothwell, Tasmania

Dr Will Bignell has brought the knowledge from a BSc in agriculture and a PhD in molecular genetics back to Thorpe Farm in central Tasmania, where his family has been farming for 200 years. “Climate is just one of the challenges,” he says. “We use technology to help manage our inputs — to produce healthy animals, valuable food, fibre and medicine. We have wool and meat sheep, and this year we’ve also got potatoes, alkaloid poppies, pyrethrum, carrot seed, rye, corn and barley.”

Bignell is co-owner of DroneAg, a precision agriculture company that uses a range of sensors on unmanned aircraft to help refine farm management decisions. But he’s not in the thrall of tech for tech’s sake. “Everyone hyper-fixates on one thing — drones, wifi or some type of sensor — whereas agriculture is about joining a whole lot of dots to make a crop or make an animal grow,” he says. “It can be incredibly varied and complex, but sometimes it can also be incredibly bloody simple.”

That said, he has covered 1500ha of farmland with wifi connectivity to allow remote sensing. “It’s a lot of smarts to control pumps, moisture monitoring and other surveillance,” he says.

A prime example of how he’s put tech to work is by adding pressure sensors and a variable-speed drive to his 960m pivot irrigator to reduce energy and water use, and deliver uniform irrigation for better crops. “We’ve integrated tech to enable us to tailor our inputs with huge benefits for our pocket and the climate,” says Bignell, who shaved $12,000 off his power bill the first year he installed the variable-speed drive.

He’s also used DroneAg for 3D soil models and moisture monitoring to inform where certain crops should be sown. “I call it the data sandwich — taking lots of information and putting it all into one useful thing,” he says. “My forte is taking existing techniques and joining the dots to create a more sustainable outcome — driving yield and profits, and adapting to extreme climate variation.”

This article first appeared under the headline 'Meanwhile, down on the farm' in the October 2025 issue of Company Director magazine.