Agriculture Industry Bets on Carbon as a New Cash Crop

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The newest cash crop for farmers may be greenhouse gas some farmers who normally make their living raising crops in the soil are now getting paid to use those plans to capture carbon dioxide from the air and put it back in their fields. Big agricultural companies including bayer and cargill are jockeying startups. On these initiatives their goal is to incentivize farmers to adopt climate-friendly practices and developed markets for carbon for more on the story. We have jacob bungee who covers the agriculture industry for the wall street journal. He spoke with our charlie turner jacob. How exactly does this. Carbon capture system work. This is a system. That's based around voluntary offsets or credits. Being purchased by companies and these could be food companies. that could be an energy company. It could be tech company that says they want to reduce their greenhouse gas emissions by some amount or achieve net zero emissions in one way that they're now going to be able to do. This is by effectively. Paying farmers who raise crops like corn and soybeans to manage their farms in such a way that the fields the soil captures carbon and stores it in the dirt and the reason for that is because plans grow. They withdraw carbon dioxide from the air. They use this in the process of photosynthesis to produce energy to grow In that process the plants then release carbon into the soil. there's no federal requirement for companies to offset their greenhouse gas emissions by buying credits from farmers. So why are companies interested in this over the last ten twenty years even longer you can see examples of consumer facing companies. Want be more sustainable and any number of reasons for this. I mean some of the have this. As part of their corporate mission as important to the founders in other cases it helps draw consumers to companies and and try to have more of a warm and fuzzy feeling by using their products or services. And so while there's no federal requirements for these companies to go and purchase carbon credits or or reduce their greenhouse gas emissions. There's a commercial incentive to do. So could you points with consumers it can be for all the the companies view. It could be the right thing to do. Farmers have long struggled with low crop. Prices how does this benefit them. Well the benefit for a farmer could be getting a check for doing this. This stuff that we talk about which for a lot of them is the type of thing that they're doing anyway to enrich their soil to get better crop yields for their typical crops and the end result is as we say is that farmers can potentially get paid for this. The company is a are pursuing. This we mentioned some of them. Bear the owner of the monsanto seed business a big agricultural company cargill one of the biggest traders of grain in the world. There's some startups pursuing. This and the idea here is that they can quantify how much carbon these farmers are are questioning in their fields with these practices a certain number of tons per acre they can be paid by the ton or paid by the acre for these practices. All these programs now are in their infancy. In some cases they're pilots and other cases they're meant to be long lasting things with just that the the first innings however the companies that are pursuing this as well as some of the farmers are hopeful that a demand from big companies that want to reduce their carbon footprint or be able to offset parts of their businesses. Might come into this market. Push up the prices for these credits. At the farmers are generating and then in turn produce more income for the farmers jacob. What do environmental activists say about offering credits for carbon capture. Well broadly speaking to the environmental community supports the basic idea. Here that if you manage farm in a more environmentally or climate-friendly way they can have an impact on carbon in the atmosphere and the way that these things are structured. They've got some questions. Some reservations One just in some sense being a philosophical one that if you are offering are making available to a polluting company a carbon offsets that reduces the the environmental groups fear that reduces the incentive for that polluting company to clean up its own operations can continue to function as it has been And pay farmers on the other side. And how does the incoming biden administration intend to approach these sorts of programs. Well tom vilsek. Who was an advisor to the biden campaign and now has been picked to potentially head the usda again. He led the the us department of agriculture during president obama's terms he's talked about putting federal. Usda conservation program funding behind this idea effectively using some conservation programs to incentivize farmers in the same way so the biden administration plans to to put the the federal emphasis behind this same exact idea

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