The Soil Health Nexus complied a list of Frequently Asked Questions educators and farm advisors are hearing regarding soil carbon and carbon markets and asked experts to weigh in.
Below are answers to the top 8 most frequently asked questions educators are hearing in the field from Brook Wilke, Associate Director for Science and Agronomy at the Kellogg Biological Station’s Long-term Agroecosystem Research Program at Michigan State University and Dave Aiken, Professor of Agricultural Economics at the University of Nebraska-Lincoln.
- What is the scientific consensus on the ability of soil to sequester carbon over time?
Brook Wilke: Scientists are confident that carbon in agricultural soils has been depleted over time, and that there is capacity to sequester new carbon in the future. It’s also clear that soil carbon depletion can occur at a much faster rate than soil carbon sequestration. For example, some experiments have shown that one tillage event can erase the carbon sequestered from 10 years of continuous no-till management. Furthermore, it will take a long time (decades or more) for agricultural soils to regain the amount of carbon that was held prior to cultivation. It’s unclear whether there is a point where soil carbon saturates, or if agricultural soils can continue to accumulate soil carbon indefinitely. This topic is being researched and debated among scientists.
Accurately measuring soil carbon changes is difficult, and requires precise methods that include deep soil sampling and understanding soil carbon fractions that are stable for long periods vs. fractions that are more accessible to decomposition. The stable carbon is the fraction that takes the longest to build, but is also the most likely to contribute to long term storage.
- What do we know about the influence of key soil health practices in sequestering soil carbon?
Brook Wilke: There’s good evidence that certain agronomic practices generally lead to increases in soil carbon. These practices include reducing soil disturbance, keeping living plants growing as long as possible (including perennials), incorporating plant diversity into the system, and adding external organic materials to the fields. The rate at which carbon is sequestered due to these practices depends on many factors (e.g. soil properties, weather, cropping system) that are specific to the field being evaluated, but scientists generally agree that all of the practices listed above will result in increases in soil carbon. One critical component of healthy soils is having regular organic material inputs that are available for decomposition and subsequent recycling of nutrients. Thus, much of this carbon is lost back to the atmosphere as carbon dioxide during this process, but a small proportion may be retained in the soil and stored for longer periods. Continuing this process and minimizing other disturbances (such as tillage) is the primary method for maintaining soil health and simultaneously sequestering carbon over long periods.
- What are some of the considerations a producer should have in mind when considering entering the carbon marketplace?
Dave Aiken: Two of the most common carbon storage practices for cropland are reduced tillage and planting cover crops. If you would need new equipment to engage in these practices you need to calculate whether the revenue from the new practices would pay for the equipment and yield a profit. NRCS programs may be available as well which you should investigate.
- Are there issues with generating carbon credits on leased land?
Dave Aiken: Yes. You need to discuss any carbon contract with your landlord or tenant before signing any agreement. Some carbon companies will not deal with tenants, but others will if the tenant has operated the land for several years. You need to check with the carbon company to see whether they will enter into carbon contracts on rented land and what the process is.
- What questions should a producer ask a company prior to entering a carbon credit agreement?
Dave Aiken: What will the payments be, how are they calculated and how will I receive them? How will carbon storage or savings be calculated? What data will I be required to collect and share with the carbon company? How will the carbon company use my data? What happens if bad weather or production issues interfere with the practices I am being paid to implement? What is the length of the contract? What are my options for leaving the contract early? Can the carbon company file a lien on my land? If so, under what circumstances?
- How much does a producer stand to make by entering the carbon marketplace?
Dave Aiken: Ag media stories report that payments of $10-15 per acre is a common cropland range. However, those payments seem high to me. You will have to calculate your own costs to know whether a particular contract is profitable or not for you. The ag carbon credit market is very fluid and you may have to shop around for the best price and the best fit with your operation.
- What can a producer do to ensure they don’t lose money through a carbon credit agreement?
Dave Aiken: You need to understand your own production costs to the penny (too many producers don’t). If you don’t it is almost impossible to know whether a carbon contract will be profitable or not. You may want to go over the contract with your lender – they may be able to help you determine whether the contract is profitable for you.
- Any general advice you have to a producer considering entering the carbon marketplace?
Dave Aiken: Have your attorney review the carbon contact with you before you sign it. The attorney will analyze all the contract fine print and advise you so that you understand all the contract provisions and are not surprised by anything in the contract.
Questions answered in August 2021.