When Agriculture Secretary Tom Vilsack first announced USDA would spend $1 billion to support projects that produce “climate smart commodities” in February, there was confusion. What exactly is a “climate smart commodity” (CSC)? There is no current market, label or recognized standard. USDA suggested only that a CSC must reduce greenhouse gas emissions or sequester carbon. No details about how much GHG must be reduced, how long carbon must be sequestered, or how efforts might be measured and by whom. Last week, the USDA expanded the program and awarded $2.8 billion in an initial round of 70 grants (more to come) for CSC projects, with an upcoming second round to reach $3.5 billion in total.
Now 70 different projects, all with different definitions and approaches, can claim the USDA-approved “climate smart commodity” moniker. The mushiness of positive words without clear definition, standards, goals or independent verification has long been used by agribusiness and food companies to their own ends From labels like “natural,” “sustainable,” and more recently “regenerative,” companies frequently make claims about farm and food products without having to meet clear standards or independent verification. Such terms stand in contrast to strong protocols and standards established under certified organic, for example.
In the world of food and agriculture, defining the farming systems and practices that benefit the climate means real money. This summer, the U.S. Security and Exchange Commission (SEC) proposed new rules requiring companies (including agribusiness and food companies) to report their climate-related financial risk and emissions, including their supply chain emissions. The SEC also is proposing rules to clamp down on weak ESG claims. Agribusiness companies like JBS have raised money through sustainability-linked bonds, based on their net-zero climate commitments. And the Commodity Futures Trading Commission is looking for public input on climate risk, including as it relates to commodity and derivatives trading (including carbon market offset credits).
As a result, it wasn’t surprising that a who’s who of agribusiness and food companies jumped at the USDA’s open invitation to define a “climate smart commodity.” The approved projects included agribusiness partners ADM, JBS, Tyson, Smithfield, Bayer, Corteva, Cargill, John Deere, Mosaic, Nutrien, Perdue and Land-O-Lakes; food companies Danone, Pepsico, Hershey, Nestle, Kellogg’s, General Mills, Frito-Lay, Del Monte, Driscoll’s and Campbell’s; supermarket giants Costco, Walmart and Target; and restaurants McDonald’s and Chipotle.
The projects also involve a slew of carbon credit developers looking to solidify their market position, including Truterra, Carbon A List, Nori, B Carbon, Indigo, Carbon Harvest, Terra Carbon and AgriCapture. Secretary Vilsack has been a long-time supporter of carbon markets and agriculture-based carbon credits going back to his time in the Obama administration. Upon joining the Biden administration, Vilsack floated the idea of a USDA-run carbon bank to purchase offset credits only to back off after congressional and private carbon market developers’ criticism. He has been a strong supporter of the Growing Climate Solutions Act, which, if passed, would require USDA to maintain an approved registry for private offset markets.
For two decades, scientific uncertainty over how much carbon can be sequestered in soil and for how long has plagued the establishment of credible land-based carbon credits. The latest Intergovernmental Panel on Climate Change (IPCC) report (Chapter 5) concluded that there is not a one-to-one relationship between precisely measured industrial sources of emissions and less scientifically certain (and less permanent) land-based carbon sequestration, including farmland sequestration. The IPCC found that climate change itself, through rising temperatures and the increasing frequency of extreme weather events, will slow or disrupt the soil’s ability to sequester carbon on farms and forests over time. An emerging body of research is highlighting the complexities of measuring soil carbon in the short and long term. An analysis of soil carbon testing found that it typically overestimates the level of sequestration by sampling too close to the surface. The U.S. has already seen extreme weather events literally burn through forest-based carbon offset sites. On top of mounting scientific uncertainty, there is growing evidence that carbon markets don’t work well to reduce GHGs, and by allowing polluters to pay to pollute, they are harming nearby communities (often communities of color). The White House Environmental Justice Advisory Council rejected the use of carbon markets to respond to the climate crisis last year.
In creating a “climate smart commodity,” Vilsack is in some ways recycling a previous strategy. During the Obama administration, Vilsack led the U.S. effort to launch a Global Alliance for Climate Smart Agriculture with corporate partners to engage at the U.N. Framework Convention on Climate Change (UNFCCC) and Food and Agriculture Organization (FAO). At the time, the use of the term “climate smart” and its all-of-the-above approach was strategic in responding to a growing global movement toward agroecology — movements that were less reliant on agribusiness’ proprietary inputs, worked better for small and mid-sized farmers and favored more diversity in farming systems. At the USDA announcement, Vilsack emphasized that the CSC initiative “will increase the competitive advantage of U.S. agriculture both domestically and internationally.”
This is not to say that there aren’t good projects within the 70 approved by the USDA. There are projects designed to incentivize cover crop adoption to build soil health and reduce fertilizer use; to improve outreach through conservation districts around the country to work with farmers (including tribal and historically discriminated) on reduced emitting practices; multiple projects that support sustainably managed beef and bison grazing and land management; tribal partnerships to recognize climate benefits of traditional crops; community science connecting small, mid-sized farmers on climate smart practices and benchmarks, technical service improvements and transition funding.
The USDA’s initiative is an unusual flex, developing a program without the input or approval of Congress. It’s also a response to longstanding Republican Party climate denial, including the blocking of any serious climate action within past Farm Bills. There is concern that if Republicans take over control of the House of Representatives, significant climate action within the 2023 Farm Bill will be severely limited in the next five years. In the decision to launch the “climate smart commodity” program through the Commodity Credit Corporation (CCC), Biden’s USDA is borrowing from Trump’s USDA, which shoveled out unprecedented billions of dollars in trade and pandemic aid to mostly large-scale commodity and livestock farmers through the CCC.
However, setting up a “climate smart commodity” program was not the only option for using discretionary CCC money to spur climate action in agriculture. In a detailed paper, the National Sustainable Agriculture Coalition and California Climate and Agriculture Network outlined a series of steps Secretary Vilsack could have taken in using the CCC to support climate action, including: support for farmers to transition from marginally productive land toward perennial grasses and sustainably managed grazing; support for farmers adding small grains like oats and pulses to more diversified crop rotations and build soil health; support to farmers to add forages to their crop rotations; support for agroforestry and permaculture systems; expanding government purchasing of climate-beneficial organic foods; investments in composting facilities and agri-solar; support to expand domestic markets for sustainably managed grassfed beef, bison, lamb and small grains, pulses and oilseeds; and expanded organic transition resources for farmers.
The threat the climate crisis poses for agriculture and our food system requires more than a project-by-project response. It will require some tough choices about our factory farm system of animal production and associated excess use of nitrogen fertilizers for animal feed and ethanol that are driving rising emissions of two potent GHGs, methane and nitrous oxide. If the global companies benefiting from the current polluting agriculture system get to write their own definition of a “climate smart commodity,” the USDA’s new projects become more about marketing and less about responding to the climate crisis.
