PepsiCo, in collaboration with Griffith Foods and Milhão, has announced the launch of a direct farmer incentive pilot program to advance regenerative agriculture in Brazil’s Cerrado region. The initiative introduces a hybrid Payment for Practice and Payment for Outcomes model, directly compensating farmers for adopting regenerative agriculture practices.
The Cerrado region produces substantial volumes of corn and over 60% of Brazil’s soybeans, making it critical to global food security. The region, one of the world’s most biodiverse savannas and a vital agricultural frontier, faces mounting threats from deforestation, soil degradation, and climate stress. For PepsiCo, the Cerrado represents one of its highest impact sourcing areas.
The program compensates farmers for adopting practices such as composting, biological inputs, and reducing chemical fertilizer use. Farmers receive upfront payments to offset the cost of sustainable inputs, and then receive performance-based bonuses for reducing agrochemical applications throughout the season.
“This program tackles one of the biggest barriers to the adoption of regenerative agriculture: the financial risk farmers face when transitioning to new practices,” said Thais Souza, Sustainability Lead at PepsiCo Brazil. “By providing direct economic incentives, we’re helping facilitate outcomes such as improved soil health, reduced greenhouse gas emissions, and climate resilience.”
PepsiCo: Scaling plans and investment structure
The pilot will cover 7,000 acres, with plans to scale to 30,000 acres — equivalent to PepsiCo’s full corn sourcing volume in the region — by year three. The initiative is co-funded by PepsiCo and Griffith Foods, with additional contributions from Milhão. Total investment is expected to reach US $1 million by year three.
The project aims to contribute to PepsiCo’s efforts to spread the adoption of regenerative agriculture across 10 million acres by 2030. Additional landscape members are already expressing interest in the program, positioning it as a potential blueprint for industry-wide transformation in the agricultural region.
“At Griffith Foods, we see this collaboration as part of our journey to help nourish the world and transform the food system, an essential part of the climate equation that demands both courage and collaboration,” said Nicholas Costa, Regional Sustainability Director at Griffith Foods Central and South America. “This collaboration shows how science, innovation, and shared purpose can turn ambition into a positive impact and help nourish both people and the planet. By sharing costs and aligning on sustainability ambitions, PepsiCo, Griffith Foods, and Milhão are demonstrating how competitors can work together pre-competitively with the aim of helping drive systemic change.”
The program is guided by PepsiCo’s Climate Resilience Platform, an open-access tool designed to help agricultural stakeholders plan for and mitigate the impacts of climate change. The initiative targets high-impact, region-specific practices to strengthen climate adaptation, secure long-term supply, and support resilient farming communities.
“This is more than a pilot, it’s a blueprint for efforts to transform agriculture in one of the world’s most critical regions,” said JP Cavalcanti, Senior Director, Market Supply Officer at PepsiCo Brazil Foods. “We’re proud to lead this effort and invite others to join us in scaling regenerative solutions that can benefit farmers, ecosystems, and food systems.”
The hybrid payment model addresses the financial barriers that often prevent farmers from transitioning to regenerative practices by providing both immediate financial support and ongoing performance incentives. The upfront payments reduce the initial investment risk, while the performance-based bonuses create ongoing incentives for sustained adoption of regenerative practices.
The three-year timeline allows for assessment of practice adoption rates, measurement of environmental outcomes, and evaluation of the economic viability of the payment model before potential scaling to additional acreage or geographic regions.
