Carbon Credit (Offset) Trading - What's Going On?
There was a lot of talk early in the decade about farmers getting paid for storing carbon in the soil and for implementing other "climate change initiatives" on the farm. Then there was a period where not much was heard. In the past year, there has been a lot in the news again about "carbon trading".
First, let's look at what is happening in the big picture. Many countries, including Canada, signed on to the Kyoto Accord and are working towards achieving their targets. There are carbon exchanges where carbon credits are being traded in Europe, Chicago and in Montreal. There is a global movement pushing for harmonization of the carbon markets.
The North American Perspective
Environmental Protection Act beginning in January 2010. An offset trading system will be set up, as well as a technology fund that can be utilized by emitters who are above regulated levels.
Climate Change Initiatives in Canada
Ontario signed an agreement with Quebec in 2008 to develop a cap and trade system. Ontario is currently involved in a pilot project to test draft tillage and nitrogen protocols. The government has also pledged to close all coal fired plants by 2014 and is currently exploring fueling some of them with biomass.
Carbon prices last year traded at $6/tonne of carbon dioxide equivalent in Chicago, $11/tonne in Montreal and $26/tonne in Europe. Canadian government studies predict the price could increase to $60/tonne by 2018. As the price for a tonne of carbon increases and the rules for trading become clearer it looks like opportunities may open up for Ontario agriculture to be part of the solution and potentially generate some revenue at the same time.
Improving Yield of Second Year Soybeans Project Update
The purpose of this project is to determine the value of a rye or winter
wheat cover crop in fields where soybeans follow soybeans. The first year
of the project saw a significant yield increase to the cover crops on
a sandy loam site and no response on a clay site. The sites in the second
year of the project were all on clay or clay loams soils. The cover crops
were planted in the first half of October and growth the following spring
was good. However the soybean yields did not show any difference between
the cover crops and the check. The project is continuing for one more
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