A win for farmers and a win for the climate

With the first of the Australian Government’s Emissions Reductions Fund (ERF) auctions held in April, hundreds of millions of dollars have been injected into carbon farming projects across the nation. At an average price of $13.95 per tonne, the total funded projects are expected to abate over 47 million tonnes of carbon. For some farmers, this injection of money has brought them back from the brink – once contemplating selling the land, they now have a new source of income to rely on for at least the next 10 years.

 ERF Results

Figure 1: Results of the Emissions Reduction Fund first auction

The benefits to farmers are not only financial – increasing soil carbon enhances agronomic productivity and the quality of the land. And the potential for mitigating climate change is significant. According to Lal (2004) the carbon sink capacity of the world’s agricultural and degraded soils is 50 to 66% of the historic carbon loss of 42 to 78 gigatons of carbon. In a recent report, it has been posited that the land sector in Australia could reduce its emissions to zero through improved farming practices and revegetation (Langmire et al 2014). Given that the land use sector is the second largest source of emissions in Australia, this is an exciting prospect. It’s a win for farmers and a win for the climate.

But will this market become self-sustaining in the future? The future looks promising. As countries around the world move towards pricing carbon, there will be many industries seeking to offset their emissions through the purchase of carbon credits such as those generated by carbon farming projects. Carbon trading markets have been operating around the world since 2002 and are most commonly seen in Europe. While we’ve been slower to cotton-on in Australia, it seems we’re now firmly on track.

Arguably, this use of market-based instruments continues a trend that started over three decades ago. The 1982 Balderstone Report on agricultural productivity in Australia prompted a shift towards liberalisation of the sector through deregulation and increased competition. This was reinforced with the global Agreement of Agriculture, resulting from the Uruguay Round of international negotiations (1986-1997), which sought to dismantle agricultural subsidies and increase market access and, in doing so, “effectively codified the neoliberal project for liberalising agriculture” (Dibden et al 2009, p. 301). Where the Europeans resisted this trend, Australia strongly embraced it and, in doing so, our agricultural sector became the second least supported amongst OECD countries, after New Zealand (OECD 2006).

The liberalisation of agriculture in the 1980s and 1990s prompted more intensive farming practices and the displacement of small landholdings for larger consolidated farms, leading to what some observers have termed “hyper-productivism” (Dibden et al 2009, p. 302). Much environmental degradation occurred as a result.

Ironically, however, it was during this time that natural resource management (NRM) emerged as a policy focus for government. The establishment of the National Conservation Strategy for Australia in 1983 is recognised as “the beginning of a national, cross-jurisdictional policy response to natural resource management in Australia” (HC Coombs Policy Forum 2011, p. 2).

So on one hand we’ve witnessed a gradual and protracted withdrawal of Government support for agriculture in favour of market-based solutions and on the other we’ve seen Government sponsor the evolution of a holistic and integrated management approach through NRM. And now, I would argue, we’re witnessing a new confluence between these two trends, with a market emerging for sustainable farming practices.

Not long ago, these practices would have been deemed unviable on their own merit as the benefit to farmers was too small. But now that we’re attributing a price to carbon we’re correcting a significant market failure and realising the full benefits – both public and private – to be gained from sustainable farming practices.

In my research project I’ve asked whether there are successful models of the public and private sectors working effectively together in the rural landscape. I think carbon farming is a perfect test-case. The Government has laid the foundations and ultimately we should expect to see the market build a momentum of its own. Though in its infancy, the situation is rapidly developing and with the urgency of climate change advancing, the future for carbon farming looks bright.

References

Dibden, J, Potter, C & Cocklin, C 2009, ‘Contesting the neoliberal project for agriculture: productivist and multifunctional trajectories in the European Union and Australia’, Journal of Rural Studies, vol. 25, pp. 299-308.

HC Coombs Policy Forum 2011, ‘Synthesis of broad issues and opportunities: Document I’, HC Coombs Policy Forum – Fenner School of Environment and Society NRM Initiative, The Australian National University, Canberra.

Lal, R 2004, ‘Soil carbon sequestration impacts on global climate change and food security’, Science, vol. 304, pp. 1623-1627.

Longmire, A, Taylor, C, Wedderburn-Bisshop, G 2014, Zero Carbon Australia – Land use: agriculture and forestry: Discussion Paper, Beyond Zero Emissions, Fitzroy.

Organisation for Economic Cooperation and Development (OECD) 2006, Agricultural policies in OECD countries: At a glance – 2006 edition, OECD, Paris.

One Comment Add yours

  1. Alex Auhl says:

    Thanks Emma! A really interesting piece and very helpful for my Frameworks assignment too!

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