Climate Concerns at Classic

OMAHA (DTN) -- How to respond to pressure for agriculture to sequester carbon and reduce emissions is a theme running through discussions during the online Commodity Classic this week.

During the opening session of Commodity Classic, leaders of the major commodity groups offered their takes on agriculture's moves to focus more on climate change, as well as the Biden administration's drive to lower greenhouse-gas emissions across the economy. Commodity Classic, which is virtual this year, is led by groups for farmers who grow corn, soybeans, wheat and sorghum, as well as the equipment manufacturers.

Kevin Scott, a farmer from Valley Springs, South Dakota, and president of the American Soybean Association, talked about the improvements in technology and equipment that have led to reduced tillage and increased production. Scott also highlighted the Soy Sustainability Assurance Protocol for exporters, in which the group states to importers that 60% of U.S. soybean products can be labeled as sustainably produced.

"But we're always trying to improve our soils because that improves our outputs," Scott said. "And we have a great story to tell. We, I think, don't want others telling us how to farm. We want all those things to be voluntary. If we improve them, say cover crops and tillage practices, all of those things need to work regionally."

John Linder, a farmer from Edison, Ohio, and president of the National Corn Growers Association, said NCGA has adopted policies supporting market-based voluntary programs for farmers to get paid for sequestering carbon or reducing their emissions. NCGA policies also seek to reinforce the benefits of ethanol and its low-carbon, high-octane advantages.

"It delivers a much-needed pathway for de-carbonization of liquid fuels, combatting climate change and reducing harmful toxins in our air," Linder said of ethanol.

Kody Carson, a Texas farmer and rancher and chairman of the National Sorghum Producers, said agriculture will need to form more partnerships with other commodity groups or businesses as well as conservation groups and industries that are net carbon emitters.

"We know we can sequester carbon in the soil," Carson said. "We know we're good at it, but we need to be incentivized instead of mandated on how to do that. It bothers me to a large degree that sustainability is the big buzzword right now when we, as farmers, have been doing this for generations."

Carson, though, also cut to a rural-urban divide on climate change and sustainability, in which he indicated farmers are facing demands coming from urban America.

"We want to leave this place better than we are, than when we came on to it. But we're dealing with individuals from an urban setting, that as long as sustainability doesn't affect their day-to-day life, it's a great thing. You take away their batteries, and all of their oil and their gas, and their transportation, their cotton and synthetic-blend clothing -- you take away their food products stamped organic but were brought overseas on a ship, then sustainability starts hitting home for them."

Looking at broader climate discussions and policy initiatives, Carson said, "I think that we all in agriculture have to band together. We have to be united, and we have to be at the table in these discussions."

David Milligan, a farmer from Cass City, Michigan, and president of the National Association of Wheat Growers, said wheat growers in some regions "have been ahead of the curve" with no-till practices and switching away from summer fallow. He reiterated that NAWG wants to see some incentive-based, voluntary carbon programs that allow participation by farmers who have already adopted carbon-sequestration practices. Milligan added sound science is needed to assure chemical users and consumers that chemicals and pesticides are safe.

"There are a lot of issues out there that I don't think are based on sound science," he said. "We certainly need all of the tools in the toolbox if we're going to save the soil. I also think we need to put a lot more money into research and wheat varieties."

Milligan said more work can be done to make wheat varieties that are more pesticide-resistant and disease-resistant, as well as perennial wheat that doesn't need to be planted annually.

"Sustainability isn't all about the environment. It's about economic stability as well," Milligan said.

CARBON MARKET POTENTIAL

In an event Wednesday focused on "Corn and Carbon, Farming's New Double Crop," Jim Hedges, a lead in the seed marketing group for WinField United, noted the carbon market has just really begun in earnest. He pointed to the "pent-up demand because of environmental concerns" by Fortune 500 companies that have made carbon-reduction pledges. Microsoft, in early February, announced a deal with Land O'Lakes' sustainability arm, Truterra, to buy up to $2 million in carbon credits, or roughly 100,000 metric tons of carbon sequestered. It was Truterra's first sale announced under its program, TruCarbon.

"I know they are actively signing up growers right now," Hedges said.

Carbon sequestration, though, can only cover a small portion of pledges by companies that translate into reducing about 2 billion tons of emissions per year. Hedges also pointed to fertilizer efficiency leading to reductions of nitrous oxide emissions, which is nearly 300 times more potent than carbon. Agriculture is the largest emitter of nitrous oxide, according to EPA.

"We are going to have to think about the reduction of greenhouse gas on top of sequestering carbon in the soil," Hedges said. "In the long term, we're really going to have to focus on the reduction area."

Aaron Sindelar, a conservation agronomist with Central Valley Ag in Nebraska, Iowa and Kansas, talked about some of the steps his cooperative is taking with carbon trading. Sindelar said even local companies in Nebraska are trying to reduce their carbon footprint and offset greenhouse-gas emissions and are looking at partnerships with farmers.

"We're still seeing that local-level interest and an opportunity with some of these companies," Sindelar said. "Again, here's an opportunity where some of these companies that you deal with day in, day out kind of situation where they're also looking at the same thing of becoming carbon neutral."

This is leading to questions from customers trying to figure out how carbon markets can fit into their farm, Sindelar said. They are looking at the kind of practices they need to adopt and management decisions to capitalize on the opportunity. Yet, there are also producers who have been no-till farmers for years, and they could fall through the cracks in the initial stages of a carbon market as everyone focuses on "additionality." That's because companies want new emission reductions to buy, not carbon already sequestered.

"We have some farmers that have adopted cover crops, for example, and right now don't have a lot of options for them," Sindelar said. "As we look at that additionality piece where these growers have adopted the two most common practices for these carbon markets today (no-till, cover crops) we need an opportunity like nitrogen management piece, in improving nitrogen efficiency."

This also is where the federal carbon bank concept may come into play. Sindelar said there is a recognition on a national scale that farmers have been doing these stewardship practice for a long time. As rules are written, a lot of these scenarios will be considered, he said.

"This is definitely something that is on the radar, but, again, it'll take a little bit of time before that it's really defined," Sindelar said.

David Dayhoff from the Ecosystem Services Market Consortium talked during the Soy Innovation Challenge about that group's work to develop the scientific protocols for programs that producers could enroll in. ESMC was started by the Noble Foundation but also has received USDA grants to help support its work. ESMC also wants to see environmental markets go beyond carbon into water-quality services. ESMC sees the carbon and water-quality markets combined for agriculture at potentially $14 billion. For these markets to develop, though, Dayhoff said standards and certification must be set.

"That's why ESMC is investing in comparative research, pursuing certification of our protocols and comparing tools and methods to find that just-right balance; it's also critical to engage farmers and ranchers as part of the process," Dayhoff said. "The decision to adopt new farming and ranching practices isn't as simple as just putting a few dollars on the table. To succeed, the market needs to match buyers' needs with protocols that work for many producers."

The theme around climate and carbon sequestration practices also continued Wednesday with a discussion around conservation and finances led by the Soil Health Partnership and another event looking at cover crops, productivity and profitability, which was sponsored by Corteva.

Agriculture Secretary Tom Vilsack will speak to Classic participants on Friday with more expectations about how climate policy moves ahead. Vilsack has said he is committed to President Joe Biden's drive to achieve an economy with net-zero emissions by 2050.

Chris Clayton can be reached at Chris.Clayton@dtn.com

Follow him on Twitter @ChrisClaytonDTN

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