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Carbon Markets

Carbon markets can offer opportunities and returns for farmers, but there are risks and trade-offs that you should consider in the context of your own farming business.

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Carbon Markets

Carbon markets have been developed by governments around the world as a mechanism to incentivise emissions reduction or carbon sequestration. For agriculture, carbon markets can also help farmers realise the value of their environmental stewardship. While carbon markets offer opportunities and returns for farmers, remember there are also some risks and considerations of which to be aware.


The Australian Carbon Credit Unit Scheme (ACCU) is Australia’s mechanism for developing carbon markets. The ACCU scheme includes several ‘Methods’ that allow farmers to get paid for either reducing or sequestering carbon emissions. New methodologies are regularly developed and can be found through the Clean Energy Regulator.

Undertaking thorough due diligence is key before deciding to participate in a carbon project.

Often, farmers will become involved in a carbon market project through an intermediary or project partner who can manage the overall project. There are a range of resources online to help you ask the right questions, including Agriculture Victoria’s guide Selling Carbon from Trees and Soils and the Australian Farm Institute’s Carbon Opportunity Decision Support Tool.

Sometimes, there may be another type of program that would be better suited to your farming system and goals.

If you decide to go ahead with a carbon market project, a few important considerations include:

Check List
Making sure your baseline is up-to-date before you begin, so you can measure your improvement.
Ensure you undertake thorough due diligence in terms of requirements like contract timeframes, costs like auditing and tax, and other potential risks of participating in a carbon market project.
Before committing to a particular intermediary or project partner, check if they are a signatory of the voluntary Carbon Industry Code of Conduct.
Communicate with your customers to ensure you understand their plans for reducing their supply chain emissions, as many processors and manufacturers are starting to report on their Scope 3 emissions and set emissions reduction targets. If this is the case for you, you’ll need to reduce your farm emissions as much as possible and then offset any remaining emissions using carbon credits until you reach the customer’s targets. The carbon credits could be earned on your farm or purchased from the carbon market.
If you earn carbon credits on your farm, you need to remember that you can either sell them on the market to generate revenue OR keep them to offset your own on-farm emissions- you cannot do both as this would constitute double-counting of the offsets.

Overall, there is no need to rush into a project. Carbon market opportunities are relatively new and will mature over time. So, work at your own pace to consider options, complete due diligence and evaluate whether a carbon market project fits into your long-term farm business goals.

Other Recommended Resources
Dairy Australia webinar Identifying on-farm opportunities: Carbon and biodiversity ( – general information suitable for all commodities.
Soil Sciences resources on Soil carbon
Australian Farm Institute “A landholder’s guide to participate in soil carbon farming in Australia
Tree Alliance Tasmania-based resource to help you think about planting trees on your farm.

Watch a FCA Webinar

FCA has created a number of webinars that you might find helpful. Explore our webinars below.

Claire Boyle

Engaging in Environmental Markets pt. 2

The market for environmental services is growing across Australia as businesses move to be more sustainable. More and more farmers are interested in becoming engaged. But how can farmers access these markets? What environmental services can farmers be paid for?

Claire Boyle

Understanding Environmental Markets pt. 1

You’re invited to join our next webinar, ‘Understanding Environmental Markets pt. 1’. Join us to hear from Andrew Ward and Rohan Clarke, the key catalysers that have been leading the team developing the Regen Farmers Mutual. They have led the co-creation process that saw farmers collectively plan the founding of a farmer-owned broker that will assist farmers access all types of Environmental Markets. The have specialist expertise in holistic/regenerative agriculture, environmental/financial markets, and in cooperatives and mutuals.

Do you know of a useful resource?

This toolkit isn’t exhaustive and FCA will be adding more resources over time – if you know of another great resource that should be added please send in your suggestions to [email protected] with subject “CSFT Suggestion”.

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