Balancing productivity and sustainability: Cattle farming, energy intensity, and environmental degradation in Latin America

This study investigates how cattle production, energy intensity in agriculture, and environmental degradation (cattle-related CO _2eq emissions) interact in Latin America and the Caribbean (LAC). Using Vector Autoregressive (VAR) and Panel VAR models on data from 12 countries between 2000 and 2018, the analysis reveals that cattle production significantly increases CO _2eq emissions, while improvements in energy efficiency help moderate this impact. VAR results show that cattle production Granger-causes both energy intensity and CO _2eq emissions, and that energy intensity itself Granger-causes CO _2eq emissions, indicating a clear, unidirectional causal chain. Impulse-response functions suggest that shocks to cattle production initially raise energy intensity and CO _2eq emissions, but eventually lead to reduced CO _2eq emissions, aligning with the Environmental Kuznets Curve (EKC) hypothesis. Forecasts project rising cattle output, declining energy intensity, and a gradual decrease in CO _2eq emissions, suggesting partial decoupling of productivity from environmental harm. Although energy efficiency gains offer mitigation potential, sustained growth in cattle production may offset these improvements without systemic change. These findings underscore the critical role of clean energy and sustainable intensification in cattle systems. The framework developed is applicable beyond LAC, offering insights for other regions facing similar challenges in balancing agricultural growth with environmental sustainability.