U.S. Farmers Look for Government Help to Support Biden's Climate Plans
A White House goal to slash U.S. greenhouse-gas emissions hinges in part on farmers and agriculture companies changing the way they manage fields and feedlots. The farm sector says it will need the government’s help to make it happen.
The Biden administration effort outlined in April has drawn support from agribusiness giants including Tyson Foods Inc., TSN 0.19% JBS SA, JBSAY -2.96% Cargill Inc. and CF Industries Holdings Inc., CF -2.01% which have been pursuing their own environmental commitments. Individual farmers, whose participation is critical to meeting the administration’s goals, are weighing the potential costs and benefits to their bottom lines, and say government support will be needed.
Near Loyal, Okla., farmer Clay Pope for years has followed some of the carbon-reduction practices being promoted by the Biden administration, including keeping vegetation on his fields even when his usual crops, such as wheat, aren’t growing. While his harvests have increased, he said, so have his costs.
“It’s not cheap,” Mr. Pope said.
President Biden has called for cutting U.S. greenhouse-gas emissions by 50% to 52% by 2030, compared with the baseline year of 2005. He said farmers could help achieve the goal—and benefit from it. In his speech Wednesday before Congress, Mr. Biden said farmers could be paid for planting cover crops that remove more carbon from the atmosphere.
The farm sector produces about 10% of U.S. greenhouse-gas emissions, with fertilizer application and livestock operations representing top sources, according to the Environmental Protection Agency.
Some U.S. Department of Agriculture programs can help reduce farms’ greenhouse-gas emissions, according to the agency, including incentives to plant trees, reduce soil erosion and curb overuse of fertilizer. The USDA in April increased payments and added new incentives under its Conservation Reserve Program, which the agency said can mitigate climate change.
Big agricultural companies, responding to consumer and investor pressure, have made voluntary commitments to cut emissions. Executives said they are using more renewable power, funding climate-friendly farming and overhauling parts of their operations, such as wastewater lagoons and fertilizer-production plants. They said the efforts put the Farm Belt in position to help the Biden administration achieve its target.
“The importance of having that goal out there cannot be discounted, so everybody is working toward the same thing,” said John R. Tyson, chief sustainability officer for Tyson Foods, the biggest U.S. meat company by sales.
With often-thin profit margins, individual farmers have tended to be wary of regulations that add costs and complexity to their operations. Concern about tighter environmental rules was one reason some farmers said they backed Donald Trump in the 2016 and 2020 presidential elections.
Farmers generally support emissions-reduction efforts but need more specifics on the Biden administration’s strategy, said Andrew Walmsley, director of congressional relations at the American Farm Bureau Federation, a trade group for farmers.
A Closer Look at U.S. Farms
“We don’t have a plan to react to,” Mr. Walmsley said. “It causes concern, and allows rumors to fly.”
The USDA has been seeking input from farmer and food groups on potential new programs, and the process of developing those remains in early stages, an agency spokesman said.
Heidi Heitkamp, a former Democratic U.S. senator from North Dakota, said farmers’ resistance toward emissions-mitigation measures had eased over the past five years. “American agriculture is now saying, ‘OK, what’s in it for us?’ ” said Ms. Heitkamp, now agriculture director for tax-services firm Alliantgroup LP.
The U.S. government in 2020 paid out a record $46 billion in direct payments to farmers, to ease the impact of economic disruption caused by the Covid-19 pandemic and trade disputes. Some agriculture executives said the industry’s sustainability investments may need a further hand from the government.
Suburban Chicago fertilizer giant CF Industries is investing in systems that reduce its plants’ emissions of nitrous oxide, roughly 300 times more potent than carbon dioxide. CF Chief Executive Tony Will said the Biden administration needed to consider carbon-related fees or taxes on imported goods to ensure that overseas rivals that aren’t taking similar environmental steps can’t sell cheaper agricultural products into the U.S., undercutting efforts like CF’s.
“We are talking about sizable investments in order to accomplish what he wants to do,” said Mr. Will, whose company has targeted net-zero carbon emissions by 2050.
The Office of the U.S. Trade Representative is considering trade tools like border-adjustment taxes to achieve the Biden administration’s goal, an agency spokesman said.
In Oklahoma, Mr. Pope said that battles with soil erosion led him to stop tilling his fields two decades ago. Minimizing tillage is one practice that the USDA has highlighted as a way farmers can curb greenhouse-gas emissions, since tilling soil releases carbon into the atmosphere. Mr. Pope also began growing cover crops like clover and cowpeas on his fields, between seasons for traditional moneymakers like wheat.
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Those practices have enriched his soil, reduced herbicide spraying and eventually cut his annual fertilizer bill roughly in half, he said, noting that the last few wheat crops have been among his best ever.
Adopting those practices also meant Mr. Pope has had to buy more seed, and initially he spent around $200,000 on new equipment. His bottom line is benefiting now, but without assistance from USDA programs, Mr. Pope said it would have been hard to justify the upfront investment.
“Everyone wants to go green to help the environment, but cash is green too,” Mr. Pope said.
Write to Jacob Bunge at [email protected]
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Published at Sat, 01 May 2021 09:30:00 +0000
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