Saskatchewan grain farmers who use minimal tillage or low-soil disturbance cropping systems learned last week that they could be shut out of the emerging and potentially lucrative market for agricultural offsets.
Under a government framework for carbon offsets being proposed by the provincial government, offset protocols will be developed and implemented in Saskatchewan, allowing farmers, ranchers and land managers to produce and sell offsets in exchange for adopting environmentally friendly management practices.
But according to sources familiar with the issue, minimum till or low-soil disturbance cropping systems likely won’t be eligible.
Provincial officials with Saskatchewan’s environment ministry confirmed that last week during a web-based information meeting with stakeholder groups.
“Offset protocol developers will have to provide evidence and rational arguments to demonstrate that the activity on which (a) protocol is based is below a 40 percent adoption rate,” said a senior official with the ministry.
“The proposed (framework) will ensure that offset credits generated in the program will get Saskatchewan closer to net zero (greenhouse gas) emissions,” the official continued.
“However, it means that some types of activities, such as zero-till cropping practices, will not be eligible for the program because (they already exceed) the 40 percent adoption rate.”
The 40 percent adoption rule is a curve ball that many carbon zero-till offset advocates had not been anticipating.
Farm groups contacted by The Western Producer did not respond immediately when asked for comment.
However, one grain and oilseed grower who contacted The Western Producer described the proposed framework as a slap in the face of Saskatchewan grain growers that have already made significant contributions to greenhouse gas reductions.
“Whoever was supposed to be representing farmers on this file has dropped the ball. They literally dropped the ball,” said the farmer, who requested that his name not be published.
“Somebody’s going to benefit financially from the carbon that’s being sequestered in Saskatchewan’s farmland. But it won’t be grain farmers. It will be someone else.”
John Bennett, chair of the Saskatchewan Soil Conservation Association’s carbon committee, said the 40 percent adoption rule would essentially disqualify all but a handful of Saskatchewan grain farmers from producing and selling no-till offsets in a regulated offset market.
“What’s important to Saskatchewan farmers in this conversation, is what will disqualify participation (in the offset market). That’s the critical consideration for us, isn’t it?” Bennett said.
“The thing that farmers really need to understand is that there’s a lot of money at stake here,” he continued.
“The provincial government, in their Prairie Resiliency Plan, is talking about nine to 12 million metric tonnes sequestered a year. Now, run your carbon taxes through that. That’s the kind of magnitude we’re looking at.”
Bennett said about 45 percent of Canada’s agricultural land is located Saskatchewan. That means grain farmers in Saskatchewan have more at stake than grain farmers in any other Canadian province.
“It (the 40 percent penetration rule) affects us more than any other province, just on land base alone,” Bennett said. “This is really a Saskatchewan issue. If we get it right, then some of the value (in a regulated offset system) comes back to Saskatchewan….”
Excluding minimum-till systems from provincial or federal offset markets will leave Saskatchewan’s farmers at a competitive disadvantage to grain growers in other parts of the world, including the United States, added the anonymous farmer who contacted The Western Producer.
American farmers will be involved in a U.S. offset system, although details of that system have yet to be finalized.
In addition, American grain and oilseed producers are not subject to a national carbon tax.
In Canada, the federal carbon tax on non-exempt activities is set to increase to $170 per tonne of carbon dioxide equivalent by 2030, up from $30 a tonne currently.
According to Saskatchewan’s general farm organization, the Agricultural Producers Association of Saskatchewan, that will add at least $12.50 per acre to annual production costs for an average Saskatchewan grain farmer.
An official with the recently formed Agriculture Carbon Alliance, declined to comment on the record.
According to the organization’s website, “the ACA was formed to ensure that Canadian farmers’ sustainable practices are recognized through a policy environment that maintains their competitiveness, supports their livelihoods and leverages their critical role as stewards of the land.”
News of the proposed offset framework came the same day as Agriculture Canada announced the formation of a new 10-year Agriculture Climate Solutions program.
To qualify for funding, applicants must demonstrate their ability to engage with researchers and develop plans for knowledge transfer and adoption among their peers.
Applicant groups who meet the program’s criteria will be invited to submit applications for funding support of up to $10 million per project beginning this fall.