A lot has happened in the development of agricultural carbon credits, markets, and programs since Indigo started hosting the Carbon Farming Connection two years ago. The options for farmers have grown—in which carbon program to choose, in how payments are made within those programs, in how the practices and credits are verified, and where the demand is coming from to support ag carbon markets. Farmers have a lot of questions about this growth, and that’s just what we aimed to answer at our semi-annual webinar featuring Agritalk host Chip Flory, farmers, soil scientists, agronomists, agribusiness leaders, and myself as host. For the first time, we also answered more than 70 audience questions live with an on-call panel of experts. Here’s a look at some of the key takeaways from the last event, which happened on February 1, 2023. Watch the full event here.
1. Don’t miss out: Farmers are getting paid now for carbon credits in a durable, recurring new rev stream.
We heard from two farmers in different stages of their carbon farming journeys who are both participating and getting paid for producing carbon credits. Keaton Brenneman, of Brennco, Inc. in Ohio, had been experimenting with cover crops before his family farm joined the Carbon by Indigo program. By expanding their use of cover crops across all their acres and reducing tillage, in year two, they received a payment for $49,000. “We were hooked by the payments. As they started to roll in, we could actually start to analyze a little bit of what actually generates credits,” said Keaton, whose family has now been paid twice through the program. “It's a lot of paperwork upfront, but once you can get all that done, it does work out pretty well.”
Greg Woll, of Woll Family Farms in Indiana, has been doing no-till and cover crops on select acres since 1995. He expanded to 100% no till in 2019 and is generating credits on the fields where he has added this practice. Woll said joining a carbon program that pays farmers the market price for that carbon made sense. “The biggest reason I chose Indigo was they were measuring what I was producing,” said Woll. “I was producing something underground and they were measuring it and willing to represent me on an open market and sell the product that I was raising. And so that just fits as a farmer.”
For Adam Jones, Sales District Manager at Missouri ag retailer MFA and a farmer himself, the opportunity to participate in carbon markets is now, not later. “I think there's a danger in agriculture by doing the typical ‘I'm going to wait and see’ kind of thing, because we have an opportunity to participate right now,” Adam said. On the acres that he manages, he is 100% no-till and cover crops and has seen the positive impacts. “You can be extremely successful moving into soil health practices,” Adam said. “And if there's a way to help fund those practices to prop up the economics of our operations, I think it makes a lot of sense.”
2. Carbon farming practices can mitigate risks like drought, heat, and excess moisture.
“If farmers can use tools or farming practices that reduce production risk while increasing the potential for revenue, yeah, it's got my attention,” said Agritalk host Chip Flory. We know we can’t control the weather, but we can consult the best tools to help know what’s in the forecast. NOAA’s Climate Prediction Center Director David DeWitt gave a weather forecast for across the U.S. He recommended farmers consult the U.S. Drought Monitor to stay informed.
Farmer Ryan Brady, of Quarter Turn, Inc in Kansas, has been challenged with both too little moisture and too much moisture. Implementing cover crops has been key to keeping his soil covered and reducing weed pressure. “Cover crops are essential because it's getting harder and harder to control weeds,“ Brady said. By managing the data, he has a clear picture of his management practices on his operation’s expenses. He could see that the cost of his cover crops was undeniably less than the savings he experienced in input costs. “All of a sudden I could pull up data and see, ‘Okay, it's actually costing me this much per acre,’ or ‘it cost me this much per bushel.’ Now I actually know for certain what it costs.”
With the right management, cover crops provide a lot of on-field benefits while working in sync with nature. Indigo agronomist Matt Powe works with farmers in eastern Kansas and eastern Oklahoma. “It's not uncommon to get three- to five-inch rainfall event within a 24-hour period the last several years, and growers I've been working with, a lot of them have gone to reduced till or no-till, but we still see erosion on these higher slopes,” Powe said. “We’ve got terraces, waterways out there, but a lot of times we're still seeing erosion. So what we found with cover crops is it really does help to have a cover out there, something protecting that soil as well as having that living root out there to anchor that soil in place.”
For farmer Liz Spruell, of Spruell Farms in Alabama, sustainable farming practices are not only good for mitigating weather risks and reducing costs, but good for her marketing, as well. “Through the verifiable processes that we have in place today, Indigo was able to leverage a relationship for a premium for our fiber,” Spruell commented. “The major companies are looking to have a traceable supply chain, and we are very excited to be a part of that movement.” Liz’s farm provides sustainable cotton to The North Face through Indigo’s Market+ Source program.
3. NRCS programs are compatible with carbon farming programs.
NRCS Chief of Staff Alyssa Charney gave some updates on what to expect from the agency in 2023. For farmers who wonder if they should wait and see if NRCS gets involved in agricultural carbon markets, she had this to say: “I know there are also questions that come up a lot in terms of how compatible are these tools that NRCS has with most carbon program enrollment opportunities. The short answer is: very compatible.” She continued on to say, “In fact, we have very clear direction to make sure that intersection and that coexistence is understood, because these opportunities are hugely complimentary.”
USDA Senior Advisor Bidisha Bhattacharyya added that the Partnerships for Climate-Smart Commodities was beginning to award billions of dollars in grants due to surging interest in sourcing climate-smart commodities. “As for consumers, there's an immense, growing demand and interest in how can the food I buy be climate smart? Corporations are asking: How do we achieve climate targets in our supply chains? And so, there's a lot of interest out there, which translates into an immense market opportunity.”
4. As the demand for carbon insets and offsets surges, the corporate world is looking to agriculture.
Indigo Ag CEO Ron Hovsepian says some of the largest corporations in the world not only have a growing need for proven sustainability solutions to meet their science-based targets, but they are also talking about agriculture’s role as an immediate, scalable, nature-based climate solution.
“It's really about harnessing this big, mega trend around sustainability and unleashing you, as the growers, to really have that impact,” Ron said. “Everybody's paying attention to your world now and I think that's a great thing. That's why the time is now to continue your investments, continue your expansion into these programs, make that journey to continue to build up where we can make the right economic and agronomic decisions that benefit the business the right way for you and then the rest will fall in place.”
5. Tracking your farm data yields results today and in the future.
When it comes to participating in sustainability markets, farm data is the key to measuring impact and getting paid for your work. Even though managing farm data does require effort, it will pay off. “The opportunities for growers to capture more value from their data, either by directly selling the data, or packaging with the commodity itself, is definitely an emerging market. We see it growing all the time,” Max Feinberg, CTO and co-founder of Verdova. While the data gets you access to a sustainability premium for your crop, it also helps you get a clear view of what is really happening on your farm. “The data collected for these sustainability markets that are tracking soil carbon, or soil health outcomes, can not only be used to bring extra revenue to the farm for those sustainable outcomes,” said Jenny Soong, soil scientist for Corteva Agriscience, “but could also hopefully be used by farmers to track their own progress, and to better analyze what practices are working for them or not over time.”
Watch the February 2023 Carbon Farming Connection here.
Terms and conditions apply. Testimonials are indicative of each individual grower’s experience and may not be representative of any specific operation’s experience with the Carbon by Indigo program. Individual results will vary based on a large number of factors. Indigo does not make any representations, warranties or guarantees as to any specific or minimum outcomes.