This was the central message from a Nedbank-hosted panel discussion at Nampo Cape in Bredasdorp, Western Cape, last week, where speakers highlighted the upfront costs, potential yield declines, and learning curve involved in changing established production systems.
Kudzayi Mazikana, head of sustainability strategy at Nedbank, said there was willingness among farmers to transition, but many were unsure where to start or which partners they needed.
“This is an ecosystem play. It is not up to one player to bear all the risk. The whole ecosystem needs to support farmers.”
He said the transition could involve additional costs and a period of lower yields, requiring banks to understand the process and help farmers manage the financial pressure until benefits materialised.
Phumela Xanywa, executive head of commercial coverage at Nedbank, stressed that there was no single blueprint for regenerative agriculture.
“Local context matters, and solutions must reflect the realities on the ground. The economics have to work. Finance, markets, and technical expertise all have a broader role to play in ensuring that the transition is commercially viable.”
Start small and measure what matters
Lomé Smit, a sustainable agriculture researcher at Trace & Save, said regenerative agriculture involved a steep learning curve in which farmers needed to move away from a blanket approach towards a more observational system tailored to the individual farm.
A dryland grain farm, for example, had a different starting point from a pasture-based dairy operation. Farmers therefore needed to identify the limiting constraints in their own systems and address these gradually.
“The ultimate goal is a healthy, resilient system. It is not just about getting good yields but about how you fare in a bad year and whether the system is resilient enough to withstand conditions that are not ideal,” Smit said.
Gabrielle Redelinghuys, group manager of sustainability at WinField United SA, similarly cautioned against attempting too much too quickly. She said farmers should start small, supported by an agronomist with practical, local experience.
Understanding the cost of each intervention was equally important. Cover crop seed could represent a significant expense, while some farming operations could require changes to equipment.
This made the financial calculation specific to each farm and reinforced the need for farmers to understand their costs before approaching financiers.
Redelinghuys said hyper-localised weather information and live monitoring could also help farmers manage risk as climate variability increased. This was particularly important when deciding when and where inputs could safely be reduced without compromising the farming operation.
Smit said measurement needed to serve farm management first, while simultaneously building the information that farmers could provide to banks, retailers, and carbon credit projects.
Sharing the cost and the risk
Franz Rentel, founder of AgriCarbon, said carbon credits could provide one source of funding during the transition to regenerative agriculture. The first 40 farmers in the AgriCarbon scheme were paid in March last year, receiving an average of R200 000, with some receiving more than R1 million.
He said the programme’s data collection model had since been refined, and the next issuance of credits, expected next year, was projected to average R600 000 per farmer.
Carbon revenue could fund between 10% and 20% of transition costs during the first three years, helping to pay for expenses such as cover crop seed and implements. However, Rentel cautioned that farmers should not expect immediate returns.
“It takes time to collect the data and generate an income. Anyone promising carbon-credit income within a few months is not being accurate.”
Tom Murray, technical manager of Woolworths Produce and Horticulture, said fear of the unknown remained a barrier to wider adoption, particularly because farmers had businesses and financial obligations to protect.
Retailers therefore needed to work alongside farmers rather than prescribing changes from a distance. He also cautioned against the misconception that regenerative agriculture required farmers to abandon all synthetic crop-protection products or farm organically.
Murray said Woolworths encouraged sourcing from growers with low chemical residues. While this did not necessarily result in a price premium, it could provide more stable offtake, which was an incentive for farmers to make the transition to regenerative agriculture.
The panellists agreed that collaboration and better sharing of both successes and failures would be critical. Farmers needed practical support, accurate measurements, and partners who understood both the production and financial realities of changing farming systems.
Xanywa said the transition ultimately needed to be built with farmers rather than simply for them.
“Regenerative agriculture is increasingly becoming a conversation about resilience, productivity, and the commercial sustainability of farming businesses.”
