Carbon market might gain profitability over time

The Environmental Director for Missouri Corn Growers and Missouri Soybean says farmers have much to consider when deciding whether to participate in a carbon sequestration program and which one.

Darrick Steen said the emerging market will change a lot in the next three years. He tells Brownfield sequestration contracts now offer farmers between $5 and $20 an acre.

“But as new buyers and more buyers and more demand for buying carbon credits arises over then next year, two or three, that price will likely go up,” he said. “Just because of demand.”

Steen was recently part of a Missouri Agribusiness Council panel discussion where some saw potential for carbon market prices to go up more than 500 percent.

Steen said prices can vary because of factors like total sequestration potential from one acre to another.

He said it’s key for farmers to weigh what the best deal is on an individual basis.

“Some of these programs are rather simplistic too,” Steen said. “Where you just agree to put in a cover crop and you’re going to get $10 an acre, up front even. That’s a pretty simplistic approach, but they may be leaving money on the table.”

Steen said the length of contracts will also likely change from one or two years to five or 10 as the market becomes established and companies try to lock in longer term commitments.

Steen presented at last week’s Missouri Agribusiness Summer Meeting.

Darrick Steen Interview

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