After dodging a speedy toddler and chatting it up with the vendors at the tradeshow, I found myself seated in a cramped conference room. We were packed in tight, with farmers standing three deep in back and along the sides.
The lighting wasn't great either; note taking wasn't going to be any easier here than it had been at any of the other 2007 Grazing Conference venues. Nonetheless, I grabbed my pen, opened my notepad, and assumed the position.
Joel Salatin was once again speaking, presenting Abe Collins from Carbon Farmers of America for the audience's approval. Mr. Collins took the floor. Then he took us into the fantastic future of carbon offsets. He invited us to imagine a sustainable economy and a prosperous nation whose small farmers flourish from responsible energy policies and practices.
Abe Collins, photo courtesy of Carbon Farmers of America. |
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Agriculture has always been the backbone of a thriving economy. Throughout history every powerful dynasty, great nation, and sprawling kingdom has owed its prosperity and strength to agriculture. Even in a modern global economy, a country that cannot feed itself cannot sustain itself; it cannot prosper.
The agriculture financial market is driven by commodities. Commodities, such as pork bellies, corn, soy beans, sugar, and milk come to mind when most people think of the agricultural market. Other agricultural commodities that may not come immediately to mind are energy based, such as oil and coal. Commodities are traded, not on Wall Street, but on the Chicago Mercantile Exchange (CME), the real backbone of the American economy.
There is a quiet newcomer in the agricultural commodity market. It slipped in while everyone was busy applauding the burgeoning New York Stock Exchange. This new commodity is called a carbon credit, and it promises to be a godsend for rural Americans if we act to secure our rightful position as leaders in the newest global market.
Corporate America and the federal government have other plans for America's landowners and their money. They distract us with superfluous, garbled language, leaving us with the impression the commodity market is much too complicated for us to understand. They pat us on our head and send us on our merry illiterate way as they rob us blind and destroy the environment.
Carbon credits or offsets, like higher ocean levels and earlier springs, are a result of global warming. The introduction of these offsets sets the stage for a colossal global reduction of greenhouse gasses by making the cost of polluting the environment another factor of doing business. This cost will be measured by corporations in the same manner other inputs such as raw materials, labor, and taxes are considered. While this greenhouse gas reduction scheme isn't law in the United States, it soon will be. Climate experts anticipate some sort of national carbon emissions regulation within the next five years.
The new trading scheme works like this: A manufacturer of widgets is allotted 100,000 carbon credits a year by the government. One carbon credit is the equivalent of one ton of CO2. This means the widget maker is allowed to spew 100,000 tons of polluting gasses into the atmosphere. However, our widget manufacturer emits 120,000 tons of noxious gas into the air. Now they must buy an additional 20,000 carbon credits to offset their allotment.
Where will they buy them, and from whom? Move over NYSE and CME, there's a new trading post in town, set up to buy and sell carbon offsets on the global market. The Chicago Climate Exchange (CCX) is the only government sanctioned entity legally allowed to trade carbon credits or, as traders call them, Carbon Financial Instruments (CFI).
CFI's are traded globally on the European Climate Exchange (ECX) as well as the CCX. Interestingly enough, both trading boards are owned by the same company, Climate Exchange, PLC. These are the entities corporate polluters turn to when looking for a way to offset their emissions.
Traders buy carbon credits from those who have them to sell, and resell them on the CCX or ECX for a tidy profit. Who has carbon credits for sale? Farmers, homesteaders, and other rural property owners have carbon credits to sell. Collectively, we have millions. Our trees and pastures remove the lion's share of greenhouse gasses from the air and trap it in the ground where it belongs.
So, how many carbon credits are there in one acre? Carbon Farmers of America believes it is somewhere around 50 per acre, depending on how that acre is managed.
A grass based farm operating on 100 acres would have about 5,000 carbon credits to sell. As of this writing, the average price per carbon credit on the CCX was $3.60 per credit. The math is pretty simple, not at all as complicated as corporate America and the government would have us believe. 5,000 x 3.60=$18,000 annually. That's right, annually.
If you think for one second family farmers are finally about to get their fair share, think again. While scientists sound the alarm about climate change, traders and hucksters pounce on America's farmers and well meaning consumers. This so called "innovative" permit trading scheme works exactly like the conventional milk market; the commodity's originator is compensated in pennies, while corporate money men rake in the cash until their fingers ache. The majority of farmers in America are not getting anywhere near $3.60 for their carbon credits, and they're being low-balled on the number of credits they own.
Government sanctioned aggregators tell landowners they have only a fraction of the carbon credits that they actually have. Some are being credited with only .012 carbon credit per acre. That translates into a whopping four cents an acre. To see how many carbon credits you officially have visit: http://carboncredit.ndfu.org/soilsoffset.html.
Farmers aren't the only ones being taken for a ride down this bumpy road paved with good intentions. Well-meaning American consumers, earnestly concerned about reducing their carbon foot print, are also vulnerable. While farmers are getting mere pennies for their offsets, conscientious consumers are paying as much as $80 on the open, unregulated market. People buy these carbon offsets believing they are supporting clean energy projects that will benefit under developed countries, believing they are contributing to the stewardship of the land. This is almost never the case.
Here's how it works: A concerned consumer decides they want to help reduce the effect of global warming. They visit one of the many websites offering to calculate their carbon foot print. When they have completed the calculations, the site offers them an offset package. The caring consumer pays a fee, ranging from $5-$80 to the company who swears they will invest the money in renewable energy projects and sustainable farming in undeveloped countries.
What happens next is beyond deceptive. The company takes the hundreds of thousands of dollars they collect from well-meaning consumers and invests it in so-called clean energy projects in poor countries. Very few of these American dollars reach the indigenous populations. Instead, these projects generate millions of carbon credits for the investors, who sell them on the CCX or ECX for a tidy profit. What do consumers get? A trendy bumper sticker and back handed absolution for their eco-sins.
Most of today's environmental pundits and profiteers focus solely on the cause of greenhouse gas emissions, utterly failing to realize the other side of the dilemma. The gasses are trapped. Even if all emissions were to cease immediately, we would still be faced with a huge problem. How do we get it out of the atmosphere?
The amount of carbon dioxide trapped in our atmosphere is increasing. In 1850, on the brink of the industrial revolution, CO2 levels were at 280 ppm. By 1998, levels of trapped greenhouse gasses had reached 364 ppm. Today the levels are at 390 ppm and rising. As a result, the planet is getting warmer and the climate increasingly unsettled.
Climate change is a complex issue, sending economic forecasters, as well as weather forecasters, into fits of indecision. Yet, for all the pause and pondering, there seems to be few viable solutions. Everyone wants to talk about it and profit from it, but it seems almost no one is actually doing anything about it.
Enter Abe Collins and Carbon Farmers of America. The moniker "carbon farmers" is most fitting of Mr. Collins and his cohorts. In a true exhibition of American agricultural ingenuity, this admittedly small band of family farmers is fighting the good fight against global warming and the decline of family owned farms.
Citing the work of Allan Yoemans, Carbon Farmers of America is trying to increase the organic matter in the soil on their farms by 1.6% to a depth of one foot. The research indicates this seemingly small increase, if achieved on the agricultural lands of the entire world, would decrease the amount of CO2 emissions trapped in the atmosphere to pre-Industrial Revolution levels, below 280ppm.
Carbon farming allows farmers to quickly generate new topsoil, and by doing so remove volumes of trapped CO2 from the air. Through the process of photosynthesis CO2 is literally sucked out of the air and sent into the roots of plants. While trees are often touted as nature's carbon storage facilities, it can take up to 20 years for them to mature enough to fully capture carbon out of the atmosphere. The fact is we can't plant enough trees fast enough to do the job; we don't have 20 years. The fastest, most efficient way of removing greenhouse gasses from the atmosphere is by growing grass. Grass, like the kind found in pastures around the world, captures CO2 very effectively and very quickly. In the process of growth and decay, the CO2 is captured and confined to the soil. Thus, cleaning the air and improving the soil all at once. Abe Collins puts it like this, "In all of my talking with people about soil and climate, I like to emphasize the absolute primacy of soil health in sustaining the human endeavor. That the atmospheric ratio of gases can be brought back into a range conducive to the current collection of life on earth through soil building is just testament to the importance of the cycle of life...the carbon cycle, and how most natural resource management issues will fall into place when we pay close attention to the health of the soil."
Carbon Farmers of America is creating true rural wealth through their efforts in soil building. They pay their member farmers for every ton of carbon dioxide captured in their new topsoil by selling Carbon Sinks to the public for $25 each. A carbon sink represents one ton of CO2 that has been removed from the atmosphere and turned into 1,000 pounds of organic matter. Independent verification is used to ensure the required organic improvements have occurred before the carbon farmer receives payment.
Consumers are told up front how their money is being spent. Each carbon sink provides $1 for the company's administrative costs, with another $5 allotted for the training, verification, and educational purposes. The lion's share of the cost of each sink, $19, goes directly to the carbon farmer. On a 100-acre grass farm that translates into about $95,000 additional income a year. That's a far cry from what licensed aggregators are offering. This government-free model of carbon farming benefits the consumer, the farmer, and the environment.
Carbon Farmers of America is attempting something that has never been done, has never even been dreamed of before, building wealth in our rural communities while building a sustainable soil. It could work. More information is available at www.carbonfarmersofamerica.com.
The carbon farming session was over much too soon. I was still contemplating what I had learned as I headed for the door. It took me a minute to realize no one was leaving. Instead, a line was forming to speak with Mr. Collins. I chuckled as I squeezed sideways through the waiting farmers. The conference may have been ending, but it sure looked like Mr. Collins was going to be there a while longer.
