With global and national regulations focusing more on greenhouse gas (GHG) emissions, Professor Richard Eckard emphasised that carbon is no longer just an environmental concern – it’s becoming a critical business consideration for Australian farmers.
BCG welcomed Professor Eckard, a leading expert from the University of Melbourne, as the keynote speaker at its annual Chair’s Breakfast.
The event attracted a diverse audience of growers, agronomists, and industry leaders eager to understand how carbon management is reshaping the grains industry.
Mandatory emissions reporting: The new landscape for farmers
One of the key takeaways from Professor Eckard’s presentation was the opportunity for farmers to proactively prepare for Australia’s incoming mandatory climate-related financial disclosures.
Starting in January 2025, many large companies will be required to report their GHG emissions under a new framework aligned with the International Financial Reporting Standards (IFRS) and the GHG protocol. This includes Scope 1, 2, and the often overlooked Scope 3 emissions – those generated indirectly through a company’s supply chain.
“Farms, even those that are relatively small-scale, are part of this larger equation,” said Professor Eckard.
“When major agricultural supply chain companies like Unilever, Nestle and Mars are setting ambitious GHG reduction targets of up to 50 per cent by 2030, that ambition filters down through their supply chains. It will be important for farmers to have a clear understanding of their GHG ‘number’ and how they can reduce it.”
He added that companies in Australia such as Rabobank and NAB, which finance a significant portion of the agriculture sector, are aiming for net-zero emissions by 2050. As a result, financial institutions are increasingly incorporating sustainability metrics into their decision-making processes, affecting both lending terms and market access for growers.
The carbon challenge: Insetting, offsetting, and farm-level action
Professor Eckard delved into the complex issue of insetting versus offsetting carbon emissions. He described carbon insetting as an approach that allows farmers to manage and reduce GHG emissions within their own operations and supply chains. Offsetting, by contrast, involves trading carbon credits in external markets.
Professor Eckard’s sentiment was that farmers would benefit from prioritising insetting, “keeping those credits within their value chains.” By doing this, farmers can retain control over their carbon footprint while meeting the supply chain demands of companies that want low-emission products.”
A core message was the importance of adopting best management practices to lower emissions, particularly in nitrogen use.
Professor Eckard pointed out that renewable-based nitrogen sources, a focus on Nitrogen Use Efficiency and where appropriate the use of coated urea products could significantly reduce GHG numbers associated with crop production.
Tools for measuring and managing carbon on farms
Professor Eckard also presented practical and simple tools that farmers can use to calculate and manage their carbon emissions. Tools like the Greenhouse Gas Accounting Framework (GAF) and the FarmPrint system allow farmers to assess their GHG emissions in real-time, giving them the data needed to make informed decisions about carbon reduction strategies.
“Knowing your number is the first step,” he said. “From there, you can look at ways to improve efficiency or explore carbon storage opportunities through improved soil management or tree planting.”
He concluded by discussing the future of carbon credits and the growing likelihood that they will only apply to truly intractable emissions post-2030.
“Carbon credits were never meant to be the first line of action. Ideally, they would be the last option after all possible insetting and emission reduction measures have been taken,” he noted.
The path forward for farmers
BCG CEO Fiona Best echoed the importance of Professor Eckard’s message for the farmers in North West Victoria: “With the right tools and knowledge, farmers can not only meet any new requirements by producing low-emission intense products but thrive by supplying sustainable products that are in high demand globally.”
The Chair’s Breakfast offered a valuable platform for knowledge-sharing and discussion on how growers can navigate these emerging challenges. Attendees left with a deeper understanding of the role carbon plays in farming’s future and the concrete steps they can take to position themselves for success.
Stay informed with BCG
BCG will continue to provide resources and updates for farmers to help them adapt to new sustainability standards. For more information on upcoming events, tools and strategies, visit bcg.org.au.
This article appeared in The Buloke Times, 29 October 2024.