Cooperative launches carbon program

TAGS: Management
Willie Vogt Corn field with cover crop
GOING BEYOND COVER CROPS: While a healthy cover crop is a popular tool for carbon sequestration, the TruCarbon program will use farm data to help farmers determine the best opportunities to take advantage of the burgeoning carbon credit market.
Land O’Lakes sustainability business Truterra launches TruCarbon. What does that mean for farmers?

Rising interest in the value of carbon sequestered on farms is a driver for a few startup businesses in the market. The newest player, however, has a different background — it’s a farmer-owned cooperative. Truterra, a Land O’Lakes sustainability business, has announced TruCarbon, the first farmer-owned carbon program.

“This is the first and only carbon credit opportunity that is both designed and delivered through the cooperative system,” says Jason Weller, vice president, Truterra. “It’s a story of a farmer co-op and a retailer owned cooperative system, designing a farmer-first approach to carbon credits.”

He adds that the system is designed to reward farmers for the stewardship they already have in place, and he adds that the farmer is in control. “We’re not buying the farmer’s future rights; they’re being rewarded and basically compensated for these new carbon commodities they created and already stored in the soil,” Weller says. “And the farmer, going forward, will retain the rights to future carbon credits. We hope they continue to do business with TruCarbon. We’re really providing the farmer the best market price for the carbon they’ve already sequestered, but also positioning their business going forward for future opportunities.”

Weller explains that the TruCarbon approach is designed to be simple, noting that some offering this opportunity in the market require more upfront work on the part of the farmer, from paying for soil tests to covering their own verification costs. “TruCarbon handles all that for the farmer,” Weller says. “We want the farmer to focus on growing a crop, being successful on their farm, stewarding their soils — and TruCarbon can offer to compensate them for that great stewardship.”

Part of the simplicity is based on the tools that WinField United has for farmers. “We have the Data Silo that protects and organizes the data that Jason was talking about,” says Brett Bruggeman, president, WinField United, a unit of Land O’Lakes. “We have the near-infrared capability from a soil sample because of our agronomic leadership with SureTech.”

Another piece of the carbon puzzle that falls into place with TruCarbon is the Truterra Insights Engine, which actually tracks key parts of a farm operation to help verify and record those practices. Bruggeman points to the co-op’s Answer Plot, where agronomic insights are captured — like hybrid response to nitrogen, or hybrid response to a fungicide.

“We have tangible tools,” he adds. “We don't have it all connected in a way that Jason and I would say is lickety-split; it’s an ecosystem, but boy, we see the tools, and I think we can connect them relatively shortly with a really solid approach that a grower is going to care about.”

Rewarding historical practices

One of the challenges of the carbon market is rewarding past actions. A farmer who has no-tilled for decades may not be in the same position to gain credits as the producer who got into cover crops in 2018. But the TruCarbon approach offers some advantages.

“It’s a mix of working with those farmers who have been adopting these soil health practices for the long term,” Weller says. “And that’s the dilemma a lot of those other carbon markets face. The TruCarbon offer can look back five years and measure carbon impact of practices in use.”

He adds that the data WinField United has provides the biggest look back opportunity for farmers to then be compensated for carbon removal. It’s important to note that there had to have been some change — adding alfalfa into the rotation, moving to strip-till or no-till, or incorporating cover crops.

Weller explains that they are looking at ways to measure changes over 10 or 20 years, but right now the carbon market also drives this approach. “This is where the buyers of carbon credits really want to have new practice adoption,” he adds. “We’re working to determine how we can bring in those [10- and 20-year] producers into a kind of future program where they are also rewarded and compensated for their stewardship.”

That carbon credit buyer can shape market demands, as they have done. TruCarbon is working first with Microsoft, which wants to be net-negative by 2030 and by 2050 to actually remove all the carbon it puts into the atmosphere. “That's a huge lift, and there’s a ton that needs to be done in the next 10 years to help just Microsoft alone in that journey,” Weller says. “But we’re seeing it across almost all sectors of the economy.”

Across the market

For Weller and Bruggeman, the opportunity is the creation of a holistic solution. Bringing together the farmer and retailer working with the technology that WinField United has invested in is the opportunity.

“I think this is going to be a shot in the arm for our suite of digital tools,” Bruggeman says, noting that the cooperative built its seed retail business by focusing on data and placement. He notes that a similar approach will evolve with Truterra and this carbon credit program.

An added value, Bruggeman adds, is the ability to work on the regulatory side of this equation. “That’s where Jason and his team can help get those types of protocols established and have the credibility in [Washington,] D.C., that is so important,” Bruggeman says.

He sees a three-legged stool of data and insights combined with understanding the regulatory side of the business. And the third leg is that retail network. “They can track the data, put the recommendations together and create a market through retail owners, because they are the trusted adviser,” Bruggeman says.

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