Saskatchewan Stock Growers Foundation uses reverse auction to pay successful bidders to plant native grass
The first of three rounds in a reverse auction to help Saskatchewan landowners seed land to grass closes March 31.
In the reverse auction, landowners bid for program money based on how much it will cost them to seed their cultivated land to native grass and keep it that way for 30 years.
The Saskatchewan Stock Growers Foundation is administering the program with $2 million in funding from Environment and Climate Change Canada.
Tom Harrison, SSGF program manager, said it’s a reverse auction because there is one buyer with a whole bunch of sellers. In this case, the SSGF is the buyer.
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“We will evaluate (bids) based on their potential to store carbon. We’ll evaluate them based on their potential to provide wildlife habitat and biodiversity and we’ll be able to rate them,” he said.
Partners at ECCC and the University of Saskatchewan are running models to standardize the values of biodiversity and carbon in the pricing.
Harrison told the Saskatchewan Stock Growers Association semi-annual meeting last month this is a big commitment for landowners.
“We need guys to think very carefully about what those costs are,” he said. “It’s not just seeding the grass and buying the seed but taking it out of production and determining what that true value is over 30 years.”
Things like crop insurance premiums taken out in case the grass doesn’t establish or the opportunity cost of not growing canola on that land should be in the bids. SSGF staff and others are available to help producers calculate their bids.
A previous program to re-establish native grass didn’t attract many applicants. One offered through the Species at Risk Partnerships on Agricultural Lands (SARPAL) from 2015-20 drew only six projects and fewer than 1,000 acres, even though it paid the full cost.
“We struggled. We struggled a lot with trying to get producers to take cultivated land out of production and put it into perennials,” Harrison said.
“The commodity prices are dictating economics and the margins are way better in that area.”
Pat Hayes, who ranches near Val Marie, participated in that program. He said part of the problem is that the money offered just isn’t enough.
“The outside influence continues to buy us for pennies on the dollar,” he told the meeting. “Two million dollars is no commitment because if you divide it by 30 years and divide it by 1,000 acres like you did the last one, it’s $60 an acre. They’ve got to get serious because we cannot continue to be bought for pennies on the dollar and keep up with the grain sector.”
Harrison said the reverse auction will act as a proof of concept to show just how much money it takes to compete with grain.
He said there is a lot of interest at the federal level in completing projects like this.
“They see the value in carbon sequestration and storage and they see the value in biodiversity. That’s why they want to invest in it,” he said.
Over time, the values of other environmental goods and services are likely to be considered as well.
The contracts with successful applicants will be legally binding, and there are clauses regarding payback if the recipient wants to tear out the grass.
Harrison said it’s often a joint decision with the producer about when the grass is ready to be grazed.
He added that there are other programs with which the reverse auction program may align, including those offered by governments and private organizations.
Producers who want to keep the grass intact longer than 30 years may want to sign a conservation easement or there could even be bonus payments by then, Harrison said.
Calvin Knoss, who ranches at Rockglen, said he appreciated the SSGF has to find a balance but asked about the overall goal.
“Is the goal to protect habitat and land or is it to preserve and protect landowners and ranchers? I could make the argument that we have a limited budget and as the agency responsible for preserving the grass our responsibility is to spread that budget as thin as we can and capture more acres and it’s not really our job to protect landowners from themselves. I’m struggling with the question of who are we representing and what are we preserving,” he said.
Harrison said the SSGF is a registered charity that does programming; the SSGA is responsible for advocacy.
“We have to have both,” he said. “We’re not going to go out there and do conservation just for the sake of conservation. It’s got to be done while we maintain the viability of the ranching community.”
