Written by Kaitlin Flick Dinsmore, Founder KMF Consulting
In the early 2000’s a new market began to emerge in the United States. In 2003, the Chicago Climate Exchange was the first platform that began to pay farmers for practices that were sustainably focused and allowed carbon to be captured in the soil and stored.
Agricultural carbon markets gained early traction in the 2000s, but widespread adoption increased from 2021 to 2023 as corporate demand for carbon offsets and regenerative agriculture investments surged. Why the demand in 2021? This was a result of various current events. First, the 2021 return of the United States in the Paris Agreement creating growing climate commitments worldwide generated expectations that carbon pricing and emissions regulations would become more important over time. Secondly, demand from investors to companies demonstrate ESG (environmental, social and governance responsibility) compliance. This boosted demand for carbon credits in the private sector.
For farmers, 2021 was important because the market began treating soil as a measurable carbon asset. Practices that improved soil health were increasingly viewed not only as agronomic improvements but also as potential financial assets capable of generating carbon-credit revenue. Suddenly, farmers had more than a cash crop to sell on their farm, they had a new opportunity to sell carbon as a commodity.
Large agribusinesses, food companies, and carbon-market firms launched farmer enrollment programs and billions of dollars flowed into carbon-market startups, measurement technologies, and farmer incentive programs.
The United States primarily operates as voluntary carbon market that is driven by the private sector. Within the carbon market industry, there are two sections: carbon insets and carbon offsets. Carbon insets are carbon credits purchased within a company’s supply chain. Think of an agriculture company tracking their use of soybeans or corn, then purchasing carbon credits from corn or soybean growers. Where as carbon offsets are not tied to a supply chain or product, and the carbon credit is offsetting the emissions from another industry. Picture technology companies purchasing carbon credits from corn and soybean growers.
For a Missouri row crop operation, carbon credits can be generated through the adoption of soil conservation practices like no till, reduced till, nutrient management and cover crops. These techniques enhance soil health, reduce erosion, reduce emissions, and increase the amount of carbon stored in the ground. By minimizing soil disturbance, no-till farming preserves organic matter and helps sequester carbon, while cover crops capture atmospheric CO2 and return nutrients to the soil. Farmers who implement these methods can quantify their greenhouse gas reductions and soil carbon removals and receive payment.
In the agriculture industry, carbon credits are used as tools to incentivize sustainable practices and an opportunity to participate in a niche market.
Kaitlin Flick Dinsmore is the founder of KMF Consulting. She is a University of Missouri Plant Science graduate. With deep roots in agriculture, Kaitlin lives what she teaches, raising cattle with her family and applying the same conservation practices she recommends to her clients.
As a Certified Crop Advisor and Technical Service Provider, Kaitlin brings extensive experience in nutrient management, regulatory compliance, and program implementation. She has worked alongside producers throughout Missouri, Kansas, Nebraska, and across the Midwest to secure funding, develop nutrient and manure management plans, and navigate USDA and NRCS programs with confidence.
Known for her practical, hands-on approach, Kaitlin is committed to helping every client protect their land, improve their yields, and maximize the financial benefits of sustainable practices. Learn more here.
