The agribusiness lobby arrives in Copenhagen

Grupo de Reflexión Rural, Biofuelwatch, EcoNexus, NOAH–FoE Denmark*

Until now, agriculture has been largely excluded from global carbon markets, but this is set to change in December 2009 at the Copenhagen conference. Agribusiness companies are lobbying hard to make a range of farming activities eligible for future funding under the Clean Development Mechanism (CDM). As a result, billions of dollars will almost certainly be invested in agriculture, mainly livestock production and plantations. What makes this prospect so alarming is that this huge investment, carried out in the name of mitigating the climate crisis, will be channelled largely to big agribusiness. And it is precisely their approach to farming and food production that has created so many of the problems we face today.

In 2008 a record 4.9 billion tonnes of carbon dioxide equivalent (CO2e) emission reductions were traded on global carbon markets. Overall, carbon trading increased by 83 per cent in just one year. [1] This trading, however, has not led to a reduction in emissions: since the Kyoto Protocol came into force in 2005, global CO2 emissions have continued to rise. [2] The growing carbon markets have not even led to emission reductions in the so-called Annex 1 countries, that is, the industrialised nations that are committed to reducing their greenhouse gas emissions under the Kyoto Protocol. Instead, the world is now on course for the worst emissions scenario predicted by the Intergovernmental Panel on Climate Change (IPCC), or perhaps one that is even worse than that. [3] Peter Atherton of Citigroup, which is strongly involved in carbon trading, admitted in 2007 that, while the parties involved had found the activity highly profitable, the world’s biggest carbon market had failed in its basic objective: “The European Emissions Trading Scheme has done nothing to curb emissions.” [4]

The Clean Development Mechanism (CDM) is an arrangement under the Kyoto Protocol that allows Annex 1 countries [5] to invest in projects that reduce emissions in developing countries as an alternative to more expensive reduction of emissions in their own countries. The CDM plays a crucial role within the carbon markets because CDM credits can be traded on other carbon markets, including the European Emissions Trading Scheme, which accounts for two thirds of all carbon trading. The only exception is CDM credits for “afforestation and reforestation”, which cannot at present be traded under the European scheme. The CDM has come under sustained criticism: for funding projects that are not “additional” and would have gone ahead anyway; for “being routinely abused by chemical, wind, gas and hydro companies who are claiming emission-reduction credits for projects that should not qualify”; [6] and for funding projects which actually increase greenhouse gas emissions, such as hydro dams. [7] Nonetheless, the great majority of proposals for a post-2012 climate change agreement involve a major expansion of the CDM and a further weakening of existing safeguards.

Before the Kyoto Protocol came into force, a decision was taken not to include soil “carbon sinks” under the CDM, largely because of the uncertainties involved in, for example, measuring carbon dioxide fluxes and nitrous oxide emissions linked to no-till monoculture. Only around 6 per cent of CDM credits have gone to agriculture, with almost all of the funded activities outside mainstream farming. Significant funding has been channelled to biomass energy projects in the farming sector: the big winners have been livestock manure management (including biogas from swine manure), heat generation from palm-oil effluents and the use of agricultural residues for biomass. In 2007, for example, 90 per cent of all approved CDM projects in Malaysia benefited palm oil companies; in Mexico half of all CDM projects are pig farms. This arrangement has meant, however, that big agribusiness firms like Monsanto have so far obtained very little funding through carbon markets and none through the CDM, despite a long-standing lobbying campaign for no-till GM monocultures to be classified as a way of sequestering carbon and reducing emissions. At the moment, there is no CDM methodology for calculating the possible reductions in greenhouse gases stemming from no-till farming as such. So far, only one large carbon trading scheme, the Chicago Climate Exchange, has included agriculture and specifically no-till farming. In Saskatchewan, a pilot project was set up in 2005 which allowed trading in credits from no-till farming, but this was later abandoned.

For similar reasons, CDM credits for soil carbon sequestration from cropland or forest management were ruled out in 2003. [8] Only the Chicago Climate Exchange and a few carbon offsetting companies and schemes, such as C-Lock Technology Canada, provide carbon credits for soil carbon sequestration. Carbon Farmers of Australia have set up the Australian Soil Carbon Grower Register and are lobbying for carbon credits for soil, but as yet these are not being traded. Moreover, the Australian government has reacted sceptically to calls by opposition politicians to support carbon credits for biochar and other soil carbon sequestration methods, saying that the technology is as yet unproven. [9] Nor has the agrofuel industry profited from carbon trading as yet. So far, no agrofuel CDM project, using biomass from crops and trees grown for this purpose or from vegetable oil (other than waste vegetable oil) has been approved. This could soon change, however: the Brazilian company Plantar has just had a new methodology approved for using charcoal made from eucalyptus plantations to produce pig iron. [10] Local communities and human rights organisations have long opposed Plantar’s plantations for the damage they have caused to people, biodiversity and freshwater resources, but their concerns have been ignored because of the allegedly more pressing need to combat global warming. [11]

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