Smoke & Mirrors, Not Worth the Extra Cost: 50 US Farmers Speak out on Carbon Markets

by Ben Palen (Ag Funder News) ... My approach in trying to learn more about the pitfalls and promises of the carbon markets has been to focus on the farmers who are, ultimately, the ones who will make or break this idea. So I prepared a short questionnaire intended to discern what farmers really think about this topic. I spoke to 50 farmers across the Corn Belt (Iowa, Illinois, and Indiana), the Delta (rice, cotton, peanuts, sorghum, corn, and soybeans), the Great Plains (wheat, sorghum, corn, sunflowers), Canada (small grains, oil seeds, lentils, and peas) and California (permanent crops such as almonds, pistachios, and walnuts). The farmers utilize a variety of agronomic practices, and about 20% of the farmers in the survey use irrigation on at least some of their land. The survey was also diverse as to age of the respondents.

The results from some 50 farmers were in line with anecdotal evidence that I have gleaned from many conversations with farmers around the country over the past year or so.

The first question asked farmers how they’d changed their farming practices with regards to tillage and cover crops, between 2012 and today.

The results clearly showed a shift away from full tillage, which ranged from 50% to 90% of their lands, in 2012, to 25%-50% this year. There were corresponding changes in favor of minimum tillage. There was just a small percentage (10%), who were using no-till or cover crops. It should be noted that about half of the respondents were in higher rainfall areas where no-till is challenging for the reasons of residue management, disease potential, and ability to irrigate (in areas that are row watered).

The range of payments offered by carbon buyers was relatively tight, with most in the $5-$12 per acre range, with the higher values being in those areas with higher land values and crop yields. To put that into perspective, as a % of typical gross income per acre from crops, the carbon payments would be barely a blip on the screen at around 1%-1.5% of per acre income.

3. Carbon measurement and benchmarking only done with soil testing, no remote sensing.

In response to a question asking how carbon credit verifying and issuing companies establish benchmarks to determine carbon payments, farerms were in one of two categories: prior soil test data from the farmer’s crop consultant or current soil testing. Interestingly, despite some claims about using satellite data to determine carbon benchmarks, none of our respondents made mention of that approach. With few exceptions, it was noted that the farmer owned the soil test data instead of a third party.

4. Additional income is main appeal but payments are insufficient to cover associated costs of carbon markets.

Our next question was focused on what the farmers perceived as the pluses and minuses of their participation in carbon markets. The largest plus was some additional income (albeit small). However, virtually all respondents listed the same minus being that the payments were not sufficient to justify the extra expense of compliance or the record-keeping associated with the program.

5. Average farmer thinks carbon markets are smoke and mirrors and impractical.

Perhaps the most interesting question of all was asking the respondents to rate, on a 1-10 scale, whether the carbon markets were smoke and mirrors, or something that provided good financial and environmental benefits. The average reply was slightly over 3. Comments that led to that low rating included (a) no recognition of good practices that I’ve already done for years; (b) no clearly defined rules, and vaguely written contracts; (c) too much paperwork; and (d) practicalities of changing some practices because of site-specific conditions.

With the caveats that this survey did not include tens of thousands of farmers, nor did it ask what it would take to get the respondents to participate in carbon programs, the results are telling, and, in my view, not surprising.

What’s next?

I believe that the potential for carbon sequestration has been hyped to a degree that a reset in approach may be warranted so that there is greater credibility in the market. And, considering the fact that vast areas of the US have followed soil-building practices for many years, it is likely not realistic to expect that agriculture as a whole can have the magnitude of impact on our global carbon issues that has been suggested by some observers. I would like to think that the result would be otherwise, but based on my own experiences (one of the first large-scale adopters of no-till farming in the Great Plains back in the mid-1980s), and those of many of my peers, a reality check is appropriate. The plain fact of the matter is that improvements in soil carbon levels take many years, and it is just not realistic to think that, say, a field presently at X is going to get to 2X anytime soon. It can be a big ask to convince a farmer to change practices in exchange for a “reward” that may take a decade, or more, to attain.

I have wondered whether, as a matter of federal farm policy, compensation should be paid to farmers who have followed good carbon sequestration practices long before they became de rigueur. Arguably, they are already being compensated because the current farm subsidies are generally tied to conservation compliance. They’re also most likely rewarded with higher yields over the long term and they could obtain higher levels of crop insurance, and lower premiums for the coverage, based on their yield histories. So, their practices make them better able to mitigate financial and operating risk than other farmers who may not be as progressive.

However, we still need a robust dialogue among the various participants in the ag-related carbon markets so that the promise and the reality of carbon markets can merge. READ MORE

Excerpt from Ag Funder News Podcast: In this week’s episode, we speak with Tom Goldtooth (Dine’ and Dakota), executive director of the Indigenous Environmental Network, an organization of Indigenous Peoples building economically sustainable, environmentally just, healthy communities.

Tom Goldtooth is particularly knowledgeable about the growing use of regenerative agriculture to capture carbon in our soils to sell as carbon credits but has concerns about how it is progressing and commodifying carbon, and therefore indirectly, promoting corporate ownership of lands. He believes this threatens local communities’ food supplies.

So we ask him about how businesses and communities might approach the climate crisis more holistically.

What I like about this conversation with Tom is that while he is very negative about the corporate world in general, he is also a realist, such as by highlighting the potential of technology — specifically indoor farming — to shore up food security for some communities.

What to expect from this episode with Tom Goldtooth:

☁️Tom’s take on carbon markets
?Water rights
?Cultivating an indigenous mindset both at an individual level and from a business perspective
?The role of technology in food sovereignty
?What an ‘Indigenous Just transition’ should look like READ MORE