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Truterra Vice President Jason Weller joined peers from Indigo Agriculture and Cargill during the March 23 Agri-Pulse Ag and Food Policy Summit to discuss the balancing act that is the evolving agricultural soil carbon market. The group came together to address the panel theme, “Who will buy carbon credits and what will they be worth?”
Truterra recently announced the launch of TruCarbon, a transformational new carbon program that helps farmers generate and sell carbon credits to private sector buyers. TruCarbon launched with Microsoft as its first secured buyer and just finished enrollment for this offer at the end of February. Farmers who qualified are currently in the soil sampling and data collection phase of the process which will be used, in addition to soil modeling, to determine the amount of carbon stored in their soils.
While the panelists agreed that the quality of carbon and/or ecosystem services credits farmers generate will be critical to market prices, they acknowledged the many challenges inherent in developing those high-quality assets. “It’s not about what organizations are paying,” Weller stated. “It’s about what the markets are purchasing. And there are still questions from buyers that science needs to resolve.”
On the supply side, Weller emphasized that focusing on practice change, while involving more risk and capital investment for farmers, is still going to be the most familiar path for them. “Buyers want outcomes, but practice-based is easier, more streamlined, and more understood. It’s in the science and measurement of outcomes where there’s a lot of tension.” He noted that for Truterra, it is advances in technology that will enable credit development to happen more cost-effectively and thus free up more of the available revenue for farmers. “To maximize value to the farmer, we need to identify the science, technology and methodology to reduce and compress those costs.”
Weller also addressed questions about buyer preferences for permanence and additionality – preferences that must be carefully managed for farmers to remain profitable. “When we scale across our ag retailer network, we are allowing for variances in weather and farming to occur,” he said. “You’re no longer just one drought or one hailstorm away from losing your credit. In the end, you reduce risk and constraints, and that’s where you get the durability.” On additionality, Weller noted that “It’s a buyer’s market and buyers expect additionality.” He said Truterra is already looking at how to partner with long-term “soil health pioneers” to create value for their early decisions to move to soil-heath-focused practices.
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