Growing of perennial and non-perennial crops — Contribution to the transition to a Circular Economy

Sector: Agriculture, forestry and fishing
Description

This activity covers practices dedicated to the production of perennial and non-perennial crops, such as fruits, vegetables, grains, and legumes. The eligibility of green investments in this sector shall be based on the transition to circularity and regenerative agricultural practices. Key focuses include reducing input dependency, improving nutrient cycling, optimizing water use, and promoting soil health through sustainable and circular practices. The activity aligns with efforts to reduce environmental impact and enhance resource efficiency across farming systems.

Scope of Assets

The sustainable practices, associated eligible assets and projects are under the following scope:

  • inputs, capital goods, crop-based transformation processes
  • agricultural or forestry-related outputs
  • waste management activities
  • primary processing or storage before the point of sale

The following are not under the scope of the activity and criteria:

  • supply chain activities related to the production or supply of inputs purchased by farms
  • the processing or distribution of agricultural products post the farmgate or after the first point of sale
  • packaging or handling of agricultural products
  • wholesale or retail.
PSIC/ISIC code

A011 - Growing of non-perennial crops

A012 - Growing of perennial crops

Technical Screening Criteria

Substantial contribution criteria

The activity complies with either one of the following criteria:

  1. Has obtained certification at a national or international level that is aligned with internationally recognised standards
  2. Provides an IFMP which demonstrates ongoing adoption of all the applicable basic, intermediate and advanced practices, or as many as feasible.

Any or all of the following eligible practices can be adopted:

Basic practices

  • Reduce replanting and stand failures through appropriate varietal choice, seed/seedling quality control, correct planting density and timing, to minimise wasted planting material and avoidable input losses (water, fertilisers and agrochemicals)
  • Implement basic soil cover and erosion prevention measures where relevant (e.g., buffer strips, contouring/bunds, ground cover/vegetative protection) to reduce soil and nutrient losses
  • Preferably use organic fertilisers, if available locally.
    • Monitor soil fertility and crop nutritional status based on local conditions. Introduce best practices to optimise productivity, avoiding contamination by excess nutrients
  • Apply an Integrated Pest Management (IPM, Prevention-first) approach that includes monitoring and preventive measures, optimises dose and timing when treatments are needed, and avoids routine/blanket application
  • Use practices that reduce losses at harvest and farm-gate handling (timing, handling procedures, sorting/temporary protection) to prevent avoidable waste before it occurs.
    • Simple harvesting and postharvest handling practices can achieve an effective cold chain, extending the shelf life of fruits and vegetables

Intermediate practices

  • Use structured irrigation scheduling informed by crop stage and monitoring (soil moisture, ET, or equivalent), including leak checks and basic tracking of water-use performance
  • Optimisation of farm residue uses that avoids combustion/degradation and promotes circularity.
    • Potential use of residues for composting and fertiliser, biogas, bioenergy, animal feed, paper, insect farming etc.
    • Pyrolysis of agricultural residues to produce biochar.
    • Production of unused oil palm biomass (trunks, empty FFBs, etc.) for fuel pellets and wood substitutes.
  • Reduce and optimise raw input demand.
    • Where locally feasible and quality-assured, prioritise secondary or recycled nutrient sources (e.g., certified compost/digestate products) within the nutrient plan to reduce dependence on virgin mineral fertilisers

Advanced practices

  • Data-driven, site-specific application (VRA, sensors, decision-support tools, satellite-based monitoring and verification) demonstrably reducing nutrient/water intensity, leakage risk and support waterlogging detection, fertilizer management.
  • A waste management plan covering waste reduction, pollution and recycling.
    • Good management of containers of agrochemicals and other residues.
    • Air, soil, and water contamination complies with national regulations.
  • Implement an Integrated Farm Management System (IFMS) that consolidates variety/planting decisions, nutrient planning, irrigation planning, IPM, and harvest/handling to systematically minimise input waste and losses, supported by continuous improvement based on performance monitoring.
Complementary measures and practices

Any of the eligible complementary measures and practices mentioned below can be applied to support transition to circularity:

  1. Production of fertiliser and biogas from animal manure and/or other organic waste or wastewater (WW Activity 3- Recovery of bio-waste by anaerobic digestion or composting)
  2. Water management measures (WW Activity 4: Production of alternative water resources for purposes other than human consumption) which includes Rainwater harvesting/storage
  3. Ensuring segregated collection of waste, to enable recovery, recycling and reuse (WW Activity 1. Collection and transport of non-hazardous waste and hazardous waste)
  4. Extend equipment lifetime through maintenance/repair; refurbish and reuse equipment; shared-use models to increase utilisation (MIS Activity 5,6 and 7)
  5. The measures to upgrade the electrical systems with renewable energy sources and energy efficient systems to accommodate the power requirements
  6. Research, development and innovation (RDI) programs specifically to enable circular design and production are eligible, including construction, upgradation and operation of pilot and demonstration facilities.
  7. Additional capacity building and training programs specifically on the following topics are eligible:
    • Occupational health and safety, and use of personal protective equipment
    • Technical training and capacity building to incorporate circularity practices
    • Technical training to ensure segregated collection of waste
Exclusionary and ineligible practices

Crop production projects involving deforestation or conversion of natural ecosystems (including forests, wetlands/peatlands and riparian areas), located outside the legally defined agricultural frontier or non-compliant with land-use zoning, protected areas, or linked to unresolved land-tenure conflicts or involuntary displacement, are ineligible.

Do No Significant Harm (DNSH)
Minimum Social Safeguards (MSS)