The Agriculture Department has a crucial role to play in developing agricultural carbon markets by ensuring the credits are legitimate and making it as easy as possible for farmers to participate, senators were told Wednesday

“Any discussion around agriculture and climate change” must involve USDA, Zippy Duvall, president of the American Farm Bureau Federation, said at a Senate Agriculture Committee hearing on a landmark ag carbon bill, the Growing Climate Solutions Act

The bill is designed to accelerate the growth of ag carbon credit trading by authorizing USDA to certify third-party verifiers and technical service providers. The third-party verifiers will in turn certify the validity of credit-generating farm practices. 

“USDA is the one that understands agriculture. Our farmers and ranchers trust USDA … For farmers to participate in any voluntary program they have to have that trust. It’s essential that all of that happen through USDA,” Duvall said. 

The bill was introduced in the Senate earlier this month by the top Democrat on the Ag committee, Debbie Stabenow, and GOP member Mike Braun of Indiana. On Wednesday, Democratic Rep. Abigail Spanberger of Virginia and Republican Rep. Don Bacon of Nebraska announced that they would be introducing a companion measure in the House. 

Stabenow said the USDA program "will jump-start climate-smart projects on farms, ranches, and private forests all across the country."

Individual companies as well as a group called the Ecosystem Services Market Consortium are developing protocols for calculating the reductions in carbon emissions provided by agricultural practices ranging from no-till farming to methane capture. Multinational corporations are expected to increase their demand for the credits as they try to meet commitments for reducing their carbon footprint.

Rob Larew, president of the National Farmers Union, said the legislation “lays a foundation that will allow the private sector and government to build market-based solutions to climate change that appropriately work with and compensate farmers and ranchers.”

Larew, whose organization operated a national carbon credit program that was disbanded after cap-and-trade legislation died a decade ago, said the proposed USDA program would provide legitimacy to the carbon markets and set the stage for other policies that may be needed to enable farmers to be compensated for reducing greenhouse gas emissions. 

He noted there are proposals to create carbon sequestration tax credits, which he said should be transferrable or salable, and to set up a “carbon bank” within USDA’s Commodity Credit Corp. to buy carbon credits. 

“A combination of big ideas is needed to ensure a stable and effective carbon market,” Larew said.

Jason Weller, vice president of Truterra, the sustainability unit of Land O’Lakes, Inc., described canon credits as a “new class of commodities” that farmers can produce, and he warned that proof of environmental sustainability is becoming increasingly important to foreign buyers of U.S. crops and livestock products. 

U.S. farmers will “have to have the data and ultimately the outcomes to be able not just to characterize the quality of the grain or the quality of the product, but … the system used to produce that food product," said Weller, who was chief of USDA's Natural Resources Conservation Service under President Barack Obama.

“We’re concerned about the long-term potential impact (on) access to international markets and ultimately international food companies," he said.

Having USDA involved in verifying carbon sequestration standards would “create the independent trust that the international market looks at,” he said.

Senate Agriculture Committee Chairman Pat Roberts, R-Kan., said it’s important to have data on environmental improvements that have already been made in some sectors, and he affirmed the importance of USDA’s involvement in carbon markets. 

“It is essential that those who provide the basis for policy decisions in this arena have a strong understanding of the complexity of these businesses’ risks and production environments,” he said. 

Arkansas Sen. John Boozman, who will replace the retiring Roberts as the committee’s top Republican in 2021, expressed concern that carbon credits could mostly benefit the third-party verifiers, who would be paid for their work, and the corporations that buy the credits to “greenwash their businesses.” 

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He also said he worries “about companies dictating how our farmers should farm. We all know that some companies have made environmental commitments without engaging the farmers who supply their raw materials,” he said. 

Brent Bible, an Indiana farmer who advised the Environmental Defense Fund, said carbon markets would allow farmers to get compensated for conservation practices that many already are following.

“The farmer will be looking for economic signals in a free market, and if the economic signal exists for a farmer to produce a certain product, in this case a carbon credit, that farmer will respond and will benefit from that market signal,” he said. "We do a great job of producing a lot of corn, a lot of soybeans, a lot of cattle, whatever that commodity might be, whenever we are incentivized to do that within the marketplace." 

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