• Fertilizer and on-farm nutrient use represent a large share of agricultural emissions, yet remain difficult to decarbonize without yield penalties.
• Early results from Europe and Latin America indicate 20 to 40 percent emissions reductions per ton of potatoes depending on crop system and fertilizer variant.
• The collaboration blends procurement commitments, low-carbon inputs, agronomic support and digital monitoring, suggesting a scalable blueprint for food system decarbonization.

PepsiCo and Yara are advancing a collaboration that targets emissions reductions across one of the most complex segments of the food value chain: fertilizer production and on-farm nutrient management. The effort provides a live test of how large food companies can pair buyer commitments with lower-carbon inputs and agronomic support to help decarbonize crops at scale without compromising yields or farmer livelihoods.

Why Fertilizer Matters for Climate and Food Security

Agriculture’s greenhouse gas footprint is substantial, and fertilizer plays a major role. Conventional ammonia production relies on fossil feedstocks and releases carbon dioxide, while field-level nitrogen use emits nitrous oxide, a potent greenhouse gas. Yet mineral fertilizer remains indispensable for food security. Roughly half of global food production depends on it, which means decarbonizing this input is central to reaching food sector climate goals.

The PepsiCo–Yara model addresses both upstream and in-field emissions. The package includes lower-carbon fertilizers manufactured using renewable or carbon capture and storage ammonia and catalytic abatement technology for nitrous oxide. This is combined with soil diagnostics and data-driven nutrient management to improve nitrogen use efficiency and curb emissions without undermining yields.

“Without collective action, the global food system is not going to change at the speed and scale needed. Our collaboration with Yara is a powerful example of what can help drive the necessary transformation. We have put farmers at the centre and are helping them scale regenerative practices, reduce emissions and build resilience across agricultural communities,” said Margaret Henry, Vice-President, Sustainable and Regenerative Agriculture at PepsiCo.

“By introducing low-emission fertilizer solutions and leveraging innovation, this collaboration helps accelerate progress toward a net-zero food system while supporting farmer livelihoods and strengthening food security. It is collaborations like this and others that demonstrate how business, government and civil society can work together to deliver systemic change,” she added.

Scaling Across Geographies and Crop Systems

What began as a Europe-focused initiative has expanded. By mid-2025, PepsiCo and Yara extended the model to Mexico, Colombia, Chile and Argentina, with an initial focus on potato growers within PepsiCo’s supply chain. The Latin America program mirrors the European structure, pairing lower-carbon fertilizers with agronomic support and digital farm monitoring tools. Early projects indicated potential 20 to 40 percent emissions reductions per ton of potatoes depending on production context.

The rapid geographic expansion suggests replicability across climates, regulatory systems and farming practices, which is central to scaling decarbonization in global food systems. It also shows how procurement commitments from multinational buyers can create demand signals for lower-carbon fertilizers and justify investment in clean ammonia production and catalytic abatement technologies.

“To transform our food system, we need to collaborate across the food value chain. We are excited to work with first movers like PepsiCo to help make this a reality. Decarbonizing food production will be critical to delivering on the Paris Agreement, and farmers will play a key role in helping us get there,” said Benoit Lamaison, Senior Vice-President for Continental Europe and Product Strategy at Yara.

RELATED ARTICLE: PepsiCo Doubles Regenerative Farming Footprint to Over 1.8 Million Acres: 2023 PepsiCo ESG Report

Governance, Economics and Adoption

From a governance standpoint, alignment between buyers, suppliers and farmers is essential. Clear commitments from food multinationals can reduce risk for fertilizer producers who face capital expenditure decisions on renewable hydrogen, carbon capture and enabling technologies. Policy support is another factor. Clean ammonia production depends on infrastructure, renewable power availability and permitting frameworks that vary across jurisdictions.

Economics at farm level remains decisive. Reduced carbon does not justify diminished yields or higher input costs. The PepsiCo–Yara approach lowers transition risk by pairing fertilizers with soil diagnostics, advice and digital monitoring rather than requiring farmers to overhaul agronomic practices. Adoption also benefits from established commercial relationships within existing supply chains.

A Blueprint for Systemic Change

The experience to date offers several takeaways for food system transformation. First, procurement commitments can accelerate upstream emissions reductions by co-investing with suppliers and farmers. Second, support matters as much as products. Agronomic advice and digital tools are essential to ensure nutrient efficiency gains. Third, transparency builds credibility. Digital data and monitoring enable verification of emissions outcomes, which investors and policymakers increasingly expect.

Finally, scalability depends on replicability across regions and crop systems. Expanding from Europe to Latin America in a short period suggests adaptability under varied regulatory and climatic conditions.

Global Relevance as Climate Pressure Mounts

As climate constraints intensify and global demand for food increases, models that reduce emissions without compromising productivity become strategically significant. The PepsiCo–Yara collaboration demonstrates how cross-value-chain partnerships can move beyond pilots toward structured decarbonization initiatives that address emissions where they are embedded: on farms and in fertilizer production.

If similar buyer-supplier frameworks expand across crops and regions and if enabling conditions in policy, technology and economics align, the cumulative impact could reshape how the global food system contributes to meeting climate targets.

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