MORGAN, Minnesota — As major companies continue to launch carbon trading programs to meet expectations of polices under the Biden administration to curb climate change, the conversation has switched to what a widespread carbon marketplace would look like for farmers.

A recent report from the Environmental Defense Fund recommended the U.S. Department of Agriculture should take responsibility for collecting data and building a carbon credit market for farmers. Farm soils could remove 4-6% of annual U.S. emissions, according to Emily Oldfield, EDF scientist and lead author of the report.

A panel session on Aug. 3 at Minnesota Farmfest was on climate change, carbon sequestration and featured discussion of carbon credits.

Jason Weller, vice president of the Truterra Division owned by Land O' Lakes, said that this winter, Land O' Lakes launched a carbon credit generation and trading program which the company claims will help crop farmers cash in on a rising demand for greenhouse gas emission credits. Noah Fish / Agweek
Jason Weller, vice president of the Truterra Division owned by Land O' Lakes, said that this winter, Land O' Lakes launched a carbon credit generation and trading program which the company claims will help crop farmers cash in on a rising demand for greenhouse gas emission credits. Noah Fish / Agweek
Jason Weller, vice president of the Truterra Division owned by Land O' Lakes, said that this winter, Land O' Lakes launched a carbon credit generation and trading program, which the company claims will help crop farmers cash in on a rising demand for greenhouse gas emission credits.

In collaboration with the Soil Health Institute, the Land O’Lakes subsidiary Truterra LLC is contracted to sell 100,000 metric tons of credits to the technology corporation Microsoft.

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According to the companies, the way it works is that Truterra covers the cost of the soil testing required to enroll and will help farmers sell the credits they create.

Weller said Land O' Lakes is entering the first round of "carbon transactions." This summer, farmers can expect to receive payments of up to $20 per ton of carbon they sequester in the first tranche of credits to be released, according to Land O’Lakes.

"We've been working with Minnesota farmers and other producers across the Midwest to now actually getting involved in a soil carbon marketplace," Weller said. "We're really proud to be part of that journey and helping farmers create new sources of revenue using soil health systems."

Public and private cooperation

To implement an agricultural carbon marketplace nationwide, a public-private partnership would need to be reached, said Tim Palmer, a farmer in southern Iowa and past president of the National Association of Conservation Districts.

Palmer said the design of a carbon marketplace should resemble the creation of nationwide conservation districts, which didn't take long to be fully functional.

"Every square inch of the United States is represented by a conservation district," Palmer said. "We've been doing this since the '30s, based on language that was brought to us by President (Franklin) Roosevelt, to control soil, soil movement and its effect on water quality and production, and now its effect on carbon and climate."

Thom Petersen, Minnesota commissioner of ag, said that the success the state has had with programs like the Minnesota Agricultural Water Quality Certification Program and Green Lands Blue Waters are due to the private collaborators those programs have.

"The things that we've gotten done in the state are done because of our partnerships," Petersen said. "The soil and water conservation districts, the NRCS and the companies."

He said what he's interested in now is where the farmer fits in to a carbon marketplace conversation, and how to ensure farmers are the ones benefiting more from a market rather than the bottom lines of private companies.

Weller said it's true for a carbon market to succeed, it has to be a public-private venture.

"The soil health conversation started in this country 85 years ago in the wake of the Dust Bowl, and it was the public investment from USDA to create really the foundation for our soil science and conservation systems in agronomy," Weller said. "And then I think for (a carbon marketplace) to be at a successful scale requires also the private sector being a part of this journey."

Brian Ryberg is a crop farmer in Buffalo Lake, Minnesota, who earned the 2021 Conservation Legacy Award from the American Soybean Association.

Ryberg, who farms corn, soybeans and sugar beets, has been strip-tilling and using cover crops for almost a decade. He said he's yet to jump into the carbon marketplace but he's hopeful that one day he will.

"At this point, we're kind of like the backup quarterback in this carbon market," he said. "Watching it happily, but still on the sidelines."

Ryberg also agrees that to move a carbon market forward, it would take both a public and private effort.

"To make this noticeably different in the farming landscape, we need to get more private companies involved," said Ryberg. "My fear from the farmers standpoint, is I don't need more paperwork — I need less — so I'm a little afraid of what that might look like."

He said he's explored some of the programs out there now for his farm, but since his conservation efforts are already in place, it's difficult to show the improvement needed to earn credit.

"Some companies are recognizing that, so we're walking through it," he said. "But it definitely is kind of the Wild West right now, and way better to be sitting on the sidelines."