2023 Sustainability Report
Why we founded Neutral
The world didn’t need a new dairy company. But it did need net new investment in climate-smart agriculture that would accelerate change and demonstrate that solutions exist. And Neutral is proving every day that solutions DO exist!
When Neutral customers buy our products, they are directly contributing to the decarbonization of agriculture, which is our mission and our north star. To date, we’ve used carbon neutrality as a means of driving action both within our own supply chain and in the dairy industry more broadly. But we know that this is not the only way to demonstrate climate action and brand integrity.
We’re continuing to evolve our approach and are excited to be developing a full Greenhouse Gas Protocol-compliant GHG inventory to better share scope 3 reductions with our supply chain partners.
How does this transition us into our work in 2024 and beyond?
Our process
Measure
We obsessively measure - from field to fridge and beyond - the entire carbon footprint of our products.
Reduce
We partner with farmers to create carbon-reduction projects on their farms.
Offset
If we can’t inset more carbon than we produce, we offset with verified carbon credits from other dairy farmers that are turning cow poop into clean energy.
Measure
Neutral collaborates with the seminal expert in the footprint of animal agriculture, Dr. Greg Thoma of Colorado State University, to complete an International Organization for Standardization (ISO)-compliant, process-based life cycle assessment (LCA) for each of its products. Each product has a unique emissions factor, representing the amount of carbon dioxide equivalents (CO2e) that are released throughout its entire life cycle.
It is a conservative estimate that includes everything from the emissions from the fertilizer used for feed production, to cow burps, to refrigeration, retail and consumer waste, and end-of-life disposal. The emissions factor is multiplied by our annual sales data to calculate the annual footprint for all products sold.
Offset
Neutral completes annual third-party certification with SCS Global Services, auditing to the SCS 108 Framework for Carbon Neutral Entities, Buildings, Products and Services. This standard requires an ISO-compliant, process-based LCA, demonstrated absolute emissions reductions within the supply region, and offsets that meet a series of standards.
Absolute emissions reductions must be demonstrated within the supply region, and must be real, quantifiable, permanent, additional, and verified by a third party. Similarly, offsets must be real, verifiable, quantifiable, permanent and additional. Any emissions that we aren’t able to reduce or remove through our own farm projects are accounted for with the use of offsets.
Reduce
In 2023, the product footprint for all our dairy and beef products across retail and foodservice amounted to 5764.3 metric tons of CO2e. We are completing verification for projects that reduced emissions in 2023 in accordance with existing carbon credit protocols and greenhouse gas project-level accounting standards.
We anticipate about 2743 metric tons of CO2e to be verified and used to account for our carbon footprint, which means that in 2023, 47.6% of our product footprint was reduced through our on-farm work.
Our Impact
Third-Party Verified Projects
Neutral Foods is committed to radical decarbonization of the agriculture industry. We invest in a variety of interventions, from well-established climate-smart practices to innovative technologies, with the ambition of scaling successful strategies beyond research.
With the knowledge that 72% of emissions associated with our dairy products come from the farm, that’s where we put the bulk of our focus. Of the emissions that occur on dairies, about one third are from enteric methane (cow digestion), one third from manure management, one third from feed production, and a small percentage from on-farm energy use. We have our sights set on addressing all four of those areas, with many projects underway already.
For our beef products, we are lucky to work with an innovative, regenerative ranching group based in the Pacific Northwest that produces grass-fed, grass-finished beef. The bulk of emissions result from enteric methane emissions—and we’re tackling those emissions head on. Grasslands also store soil carbon and we’re exploring how to best protect the carbon that is already there.
Across our supply chain (and most importantly, in collaboration with our farm partners) we’re decarbonizing at a rate that exceeds the target set by the Science Based Targets Initiative (7% annually) to align with the IPCC of limiting global warming to 1.5°C. In 2023, almost 48% of our emissions are accounted for through verified insets from our on-farm projects.
Here’s how we’re doing that:
Agolin
Total Estimated Impact in 2023: 2743 metric tons CO2e
In 2023, we’ve rapidly scaled our feed supplements program with dairy producers. Agolin is a feed supplement that contains essential oils from coriander seed, eugenol (a compound found in clove), and geranyl acetate (a compound commonly found in carrots, geranium, citronella and lemongrass).
This essential oil blend affects the rumen, the stomach where the bulk of methane emissions occur, leading to decreased emissions and improved feed efficiency (less feed, same milk yield!). Fed at just 1 gram per cow per day, research shows an 8.4% reduction in enteric methane emissions.
Beyond decreased emissions, producers have reported a wide range of co-benefits including improved body composition, improved reproduction, and cost savings from improved feed conversion.
Meet Chris Devries: Devries Dairy in Oregon has seen an increase in milk production of 5 pounds per cow a day, or about 6.5% since feeding Agolin, all while feeding the same amount.
Meet Travis Klinkner: Travis Klinkner runs his small, organic 70 cow dairy in Wisconsin with his family. To learn more about Travis, click here.
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Meet Harlan Miersma: Harlan Miersma is a conventional producer in Oregon with 1,500 cows. He's had a very positive experience including Agolin in his feed regime. Beyond the enteric methane reduction, he has also seen feed efficiency increase by about 5%—meaning the cows are eating less feed and milk production is staying the same.
SeaGraze (asparigopsis taxiformis)
Neutral Carbon Reduction team members inspecting the GreenFeed measurement system at Carman Ranch on a very chilly April day
Total Estimated Impact in 2023: 1 metric ton CO2e
This past summer, Neutral partnered with Symbrosia, the developer of SeaGraze, and Carman Ranch, Neutral’s beef producer, to trial SeaGraze. SeaGraze is a feed supplement made from a type of red seaweed called asparagopsis taxiformis that can be fed in small doses every couple of days to reduce enteric methane. Many trials in research settings have shown an over 80% reduction in enteric methane, but to the best of our knowledge, this was the first trial in a grass-fed, grass-finished system.
Beyond confirming the enteric methane reduction with the use of a GreenFeed system to measure the gas exchange of the cows in the trial, we also worked closely with Carman Ranch to solve for implementation and operational hurdles in including this new practice.
The trial was highly successful, with a reduction of over 75% in enteric methane emissions and it resulted in the first ever registered credits with Verra using asparagopsis taxiformis as a feed supplement.
To hear more from Neutral and Symbrosia at our 2023 SXSW Panel, click here.
Projects in the Ground
Beyond the projects that were active and verified in 2023, Neutral invested in other project types as well. Where some of these projects will result in verified insets in 2024 and beyond (such as alternative manure management strategies), others are earlier-stage research and/or a path to verified insets is still in the works.
Solid-Liquid Manure Separation (SLS)
Installation of a solid-liquid manure separator at a Neutral project site
At dairies, a common practice to keep barns clean and animals comfortable is to scrape or flush manure from the barn or milking parlor into a lagoon. The solid manure in the lagoon is high in organic material, and when suspended in liquid manure and water, the conditions favor anaerobic decomposition. Anaerobic decomposition occurs with bacteria that can break down organic material without oxygen, but this process leads to a highly potent greenhouse gas: methane.
By reducing the amount of solids that end up in the lagoon through separation, there are fewer methane emissions emitted. Solids can then be composted or stored for use as fertilizer on fields, and both resulting solids and liquids are in easier forms for transportation and use around the farm.
Meet Robert and Stewart Kircher with Forest Glen: Forest Glen is a 3000-cow organic dairy in Oregon. They had an old separator that was too small to handle the manure from the number of cows and not able to keep up with the manure load. We worked with Robert to finance and install a new separator that will be a better fit for their current operations. Construction began in December and operations have since started! We’re thrilled with the reductions that will occur each year for the next 15 years, about 5,100 metric tons CO2e per year, totaling over 77,000 metric tons CO2e over the project lifetime.
Tannins in Forage
Dr. Sarken Ates on a Neutral project farm
Tannins are a biocompound found in all sorts of plants and are commonly recognized by the mouth-puckering feeling when consuming red wine, unripe fruit, or tea. Tannins are also present in many species used in forage on pasture-based dairies. Species with higher concentrations of tannins such as plantain or birdsfoot trefoil have shown promise in reducing enteric methane emissions in dairy cows when consumed at high enough concentrations.
Adding these species through overseeding (spreading seed over the top of soil) or pasture refurbishment (drilling to get the seed into the topsoil) to existing pastures can increase the concentration of tannins in cows’ diets.
Neutral is working with Dr. Serkan Ates (Oregon State University) to identify the right species, seeding rating and seeding method to increase condensed tannins in diet. We collect samples to analyze tannin concentrations available in forage and are using our learnings to create more consistent tannin availability in the diet.
Sainfoin Hay
Sainfoin hay growing at Carman Ranch
Sainfoin hay is a species high in tannins that’s a particularly great alternative to resource-intensive alfalfa hay, because it’s a perennial crop that does well in drought conditions, requires less water than alfalfa, and blooms during a time of year where few other options for pollinators exist.
This results in a major boost for pollinator species like bees, and overall biodiversity. Sainfoin is also a legume, meaning it forms symbiotic relationships with nitrogen-fixing bacteria called rhizobia, and requires less fertilizer inputs like nitrogen to be successful. Beyond the co-benefits that sainfoin provides, Neutral is interested in its ability to reduce enteric methane emissions when fed to cattle.
In late 2023, Neutral worked with Carman Ranch, Dr. Logan Thompson at Kansas State University, and hay-producer Mark Butterfield to test the effectiveness of sainfoin hay at reducing enteric methane when fed to beef cattle. With the use of a GreenFeed machine, like our work with asparagopsis taxiformis, we were able to capture real emissions data from cattle to compare their emissions when fed alfalfa hay vs sainfoin hay. Preliminary results were very promising, showing an average reduction of 50 grams CH4 per animal per day. We plan to continue this work with Carman Ranch and Dr. Thompson in 2024.
Projects in Exploration
Electrification
Though energy isn’t one of the largest sources of emissions on dairies, diesel use can still be a significant source of emissions. Electrifying farm equipment is one way to both curb emissions and to improve air quality.
At Forest Glen, their feed mixer requires a significant amount of diesel, so we’re exploring electrification to reduce the amount of diesel used to both run the machine and haul feed on their dairy.
At a Washington dairy, we’re exploring installing an electric scrapper that’s used in their solid liquid manure separator. In regions like the Pacific Northwest, where much of the electricity comes from green sources such as hydroelectric power, electrification has a major climate benefit.
Silvopasture
Travis Klinkner and the Neutral team plant trees for a silvopasture project at his farm in Wisconsin
Silvopasture is the deliberate integration of trees and grazing livestock operations on the same land. Travis Klinker, who owns an organic dairy in Wisconsin, is excited about incorporating silvpoasture into his operation. He’s interested in planting leguminous and fast-growing trees in rows through his paddocks, spaced far enough apart for cows to move freely through the paddock and take advantage of the shelter and shade provided by the trees.
With a combination of tree species, such as mountain alder and honey locust among others, there will be an increase in biodiversity, an increase in above and below ground carbon, improvements to water quality and decreased soil erosion. Neutral is exploring partnerships with technical service providers in the agroforestry sector, and we’re excited to see this project start soon.
Feed production
In 2024, we’ve got our sights set on expanding our support of interventions that improve feed production, such as reducing nitrogen fertilizer. Not only is nitrogen fertilizer carbon intensive to make, but excess applied nitrogen is also lost to the atmosphere as nitrous oxide emissions, a greenhouse gas with over 250 times the global warming potential of carbon dioxide. It can also leach into ground water and waterways.
Increasing crop rotations, supporting biological activity in the soil through innovative products or greater specificity in application, or intercropping can all help to reduce inputs. Adopting practices that protect existing soil carbon, like reducing tillage, or adding more carbon to the system like planting cover crops, are also great ways of improving feed production systems.
Meet the Groenvalds: On a farm in Western Washington, the Groenvalds have recently switched from dairy farming to crop production. Much of what they produce is corn, but weed pressure has motivated them to explore options for pest control. Neutral helped them purchase a piece of equipment that allows them to sew a second cropping in between the rows of their existing corn crop. This helps reduce weed pressure, keeps soil protected from wind and water erosion by increasing the time it’s spent covered, decreases their input use, and increases their profitability by adding a second crop.
Going Beyond Our Supply Chain
We believe everyone has a role to play in increasing the sustainability of our food system. We are thrilled to be able to help friends of Neutral implement climate-smart practices on their farm, even when it falls outside of our supply chain. Knowledge sharing is imperative to scaling these practices and this year, we were thrilled to support folks interested in doing their part to fight climate change.
Meet Gen Padelecki: Gen and her husband, Jared Padelecki, recently purchased a small hobby farm in Texas. Gen is passionate about sustainability and through her organization TOWWN (Take Only What We Need), advocates for environmental stewardship in how we live and how we eat. Neutral helped Gen gain a better understanding of her farm and the various opportunities for implementing climate-smart practices. We’re excited to see progress on her farm over the next year!