Isra-Mart srl : Carbon pooling advantage for farmers

www.isra-mart.com

POOLING of carbon and biomass will allow farmers to take advantage of opportunities in the billion dollar carbon market resulting from the Carbon Farming Initiative (CFI).

Speaking at the 2011 Oil Mallee Industry Conference in Perth, Australian Carbon Traders (ACT) director Ben Keogh said buyers will not want small contracts so landholders must aggregate to satisfy the varied market demands.

With the uncertainty surrounding the future carbon market, farmers should be planning for small varied supply volumes to meet a large, varied market demand.

Pooling would allow farmers to apply a traditional approach they were comfortable with to a new industry.

Mr Keogh said the present carbon market in Australia was a regulated voluntary market governed by the National Carbon Offset Standard (NCOS) where people measured, monitored and reported on their carbon emissions and used offsets to become carbon neutral.

"We have about 17 key buyers at the moment and their purchase parcel size ranges from the smallest at 300 tonnes up to about 200,000t," Mr Keogh said.

"All up, we're looking at something around the 1.4 to 1.5 billion tonnes bought annually."

Mr Keogh said the mandatory international market was valued at $136 billion globally in 2009.

He said forestry or farm abatement activities were already a strong performer in the voluntary market and was influenced strongly by marketing campaigns.

People were influenced by the point of difference at the purchase point where given a choice between two equal washing powders, for example, they would choose the low carbon emitting one.

Pooling would enable participants to enhance their marketing power to take advantage of the emotional triggers that influence consumer buying.

Marketing research could also be used to adapt abatement choices further back in the supply chain.

"One of the major reasons for pooling is economies of scale, where you can start getting a larger amount of carbon sequestration managed in a single way and share the costs and methodology to get a cheaper product to market," Mr Keogh said.