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Funding
Flows for Climate-Smart Grants
Citing Demand, USDA More Than
Triples Funds for Climate-Smart Pilot Program
9/14/2022
By
Chris Clayton, DTN Ag Policy Editor
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USDA's Partnership for Climate-Smart Commodities program announced 70
projects nationally meant to test if farmers and livestock producers
can sequester
carbon in the soil while getting more value for their commodities. At
least 13 of the projects involve livestock, including some that
incentivize
diversifying grazing rotations and using cover crops to graze cattle. (DTN
file photo)
WASHINGTON (DTN) --
After pitching a climate-smart pilot program last spring that was
expected to cost $1 billion, USDA on Wednesday rolled out up to $2.8
billion in grants under the Partnership for Climate-Smart Commodities
with expectations that more funding will be released before the end of
the year.
Fully implemented,
the 70 projects are expected to reach more than 50,000 farmers in all
50 states and Puerto Rico and encompass as many as 25 million acres
with practices such as cover crops, no-till and nutrient management.
The projects will offer technical help and payments to farmers who
adopt practices that lower greenhouse gas emissions in their
operations and sequester carbon in the soil.
"This is a really,
really important day for American agriculture," Agriculture Secretary
Tom Vilsack told reporters Tuesday. "I just hope people understand the
significance of what we're doing here."
Companies,
organizations and universities tied to these 70 projects are required
to provide both technical and financial assistance to producers who
enroll in these projects on a voluntary basis. They must also develop
and promote markets for the commodities derived from these
climate-smart practices.
As he has repeatedly
mentioned in the past, Vilsack said he believes the pilot projects
will show that agriculture can play a role in combatting climate
change. U.S. agriculture, he said, will have a leg up on other
countries focusing on sustainability in the supply chains.
"We all recognize
that agriculture needs to be part of the solution, not part of the
problem," Vilsack said. He added, "This will allow the United States
agriculture and forestry industry to take a leadership role
internationally."
If fully realized,
the agricultural and forestry projects will sequester the equivalent
of more than 50 million metric tons of carbon dioxide. USDA stated
that's roughly akin to removing more than 10 million gasoline-powered
passenger vehicles from the road for one year.
Along with the $2.8
billion in funding from USDA, Vilsack said the projects will also
include roughly $1.4 billion from the private-sector partners
involved.
Applying those
dollar figures, the 70 projects collectively would spend $4.2 billion.
If they reach 50 million metric tons sequestered, that will put the
costs at $84 per metric ton. That's more than double what some of the
top carbon credit companies are offering farmers in the voluntary
carbon offset market.
MORE FUNDS FROM
CCC
When USDA put out
the notice for the pilot projects last spring, the department received
450 applications for the large tranche of funds -- projects ranging
from $5 million to $100 million in funding proposals. USDA received
another 650 applications for a smaller grant program that will fund
projects from $250,000 to just under $5 million.
"Well, suffice to
say, the $1 billion that was set aside -- given the demands and given
the interest that has been expressed by agriculture and forestry -- I
asked the staff at USDA to take a look at ways in which we can
increase our commitment to those departments," Vilsack said.
USDA was approved
for another $2.5 billion, bumping up the full program to as much as
$3.5 billion that will be used from the Commodity Credit Corp. (CCC)
fund over the next five years. The project funding will likely receive
a barrage of criticism from congressional Republicans who have
repeatedly questioned and condemned USDA using CCC funds for climate
programs.
Despite tapping the
fund for up to five years of commitments, Vilsack told reporters on
Tuesday that CCC will fully fund its commodity payments under the farm
bill and close out the 2022 fiscal year in a couple of weeks with
"several billion dollars left over after all of that." He added,
"There is plenty of latitude left in the CCC."
Once the Biden
administration took office, Vilsack noted discussion on how USDA
should focus on reducing greenhouse gases in agriculture and
sequestering carbon leaned heavily on advice from farm groups. He
pointed to recommendations from the 80 organizations that make up the
Food and Agriculture Climate Alliance (FACA), which specifically
proposed USDA develop pilot projects.
"We basically
followed the prescription or the outline they provided to a T," he
said.
FACA "commended"
USDA for its selection of projects and using the coalition's
recommendations "as a guidepost" in developing the projects. FACA
noted USDA's "meaningful inclusion of early adopters and small and
underserved producers in the program. The coalition added, "The
Alliance is pleased that the projects selected recognize differences
between regions, farm size and forest type, and diversity of
production in the United States."
VERIFYING
PROGRESS
Regarding
quantifying the results, Vilsack said each project will be responsible
for periodic reporting of information to USDA as well as holding
frequent meetings over the progress. That information should then be
made public, the secretary said.
"Everyone who
participates agrees to be part of a network that will report data and
information that will be provided to USDA," he said. "We will be
reporting on a regular basis" to the public and Congress.
SOME MAJOR
PROJECTS
DTN is part of one
of the projects being funded, "Farmers for Soil Health Climate-Smart
Commodities Partnership," which will receive up to $95 million to
"accelerate long-term cover crop adoption" by creating a platform to
"quantify, verify, and facilitate the sale of ecosystem benefits,
creating a marketplace to generate demand for climate-smart
commodities." The partnership will involve farmers in at least 19
states who grow corn and soybeans. The National Corn Growers, United
Soybean Board, National Pork Board, National Center for Appropriate
Technology, National Association of Conservation Districts, Soil
Health Institute, University of Missouri, Sustainability Consortium,
DTN and The Walton Family Foundation are involved. The project is led
by the National Fish & Wildlife Foundation.
Among the projects
and producers who could be involved, there are 13 projects that
involve beef or other livestock; 13 tied to fruit and vegetable
production; 12 that involve corn and soybeans; nine involving dairy
production; six involving cotton, peanuts or other nuts; four projects
for rice; three involving wheat production; and three involving hay or
energy grasses.
Companies involved
run the gamut from agricultural and food supply chains, including ADM
to Corteva, John Deere, General Mills, Tyson, Cargill, JBS, Bayer,
Land O'Lakes, Dairy Farmers of America, Unilever, PepsiCo, Coca-Cola,
Campbell's Soup, Farmers Business Network and Indigo Ag, just to name
a few.
Among a few
highlights in other projects:
-- Dairy Farmers of
America will look to create a "low-carbon dairy opportunity" through
its projects to lower dairy emissions.
-- The Meridian
Institute will look to streamline field data collection to help
quantify emission reductions on farms that produce value-added
specialty crops, as well as row crops, or sell directly to consumers.
-- South Dakota
State University will lead a project for beef and bison producers to
develop grazing strategies and land management practices with a goal
to expand market demand for climate-smart beef or bison products.
Later this year,
USDA should spend roughly another $700 million to fund smaller-scale
climate-smart commodity projects as well.
The full list of the
70 projects can be found here:
https://www.usda.gov/climate-solutions/climate-smart-commodities
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