In 2015, the Paris Agreement was adopted by 195 countries, which committed to hold the increasing average global temperature through practical measures. One of the instruments adopted for that purpose was the carbon market.
The carbon market is one of the strategies to control the climate crisis by effectively putting a price on pollution and creating an economic incentive so that nations reduce their harmful emissions to the environment.
Among several possibilities, wheat production deserves our attention. This was the subject of a study conducted by Embrapa Trigo in Rio Grande do Sul state in partnership with the Universidade Federal de Santa Maria (UFSM).
The results showed that wheat could sequestrate more carbon than it emits to the atmosphere, benefiting the carbon market.
Carbon market: combining economic interest and sustainable production
Before learning more about the study conducted by Embrapa Trigo and USFM, we should understand what the carbon market means.
Embrapa researcher Anderson Santi stated that the carbon market was created during the ECO-92 in Rio de Janeiro. “At that date, the United Nations Framework Convention on Climate Date (UNFCCC) was created, leading to the early stage of the carbon market.”
However, there were several steps so that the market could come into effect. In that sense, the Kyoto Protocol in 1997 in Japan defined stricter rules for the signatory countries to reduce greenhouse effect gas (GHG) emissions.
Based on the premise that 55% of the countries representing 55% of global greenhouse gas emissions were required, the protocol came into effect in 2004, allowing for the pricing of regulated gases under the Kyoto Protocol and transactions of reduction certificates among the signatory parties.
The carbon market has two modalities
Within the carbon market, it was agreed that a ton of carbon dioxide (CO2) corresponded to one carbon credit traded in the domestic/foreign market.
Santi explains two modalities in the carbon market: mandatory market and voluntary market.
In the first case, rules are defined by local, regional, or federal governments. “In that case, the ton price is defined by the regulatory authority, and there is an obligation to reduce or offset emissions, but that modality was not established in Brazil.”
In the voluntary market, carbon credit generated from reduced emissions is driven by self-initiative from individuals, companies, and organizations. The price is negotiated through project-based contracts and is already operational in Brazil.
“In that case, some examples of carbon credit generation are the adoption of sustainable and regenerative agriculture, energy efficiency, re-use of waste, renewable energy, biofuels, reforestation, and forest conservation,” states the researcher.
Considering how important it is to the country to mitigate GHG emissions and fight climate change, establishing a mandatory carbon market in Brazil is under discussion in the Brazilian Chamber of Deputies.
“In the Chamber of Deputies, there are at least five bills in progress on the Brazilian Reduction of Emissions Market (MBRE),” affirms Santi.
Wheat in Brazil: production in expansion
Brazil is the world’s eighth wheat importer. In 2022, information from the Ministry of Economy stated that 5.8 million tons were imported.
Moreover, data from CONAB shows that wheat planted area in Brazil has continuously grown in the five last crops, going from 1.9 million hectares in 2017 to 3.09 million hectares in 2022, a 61% growth.
Latest forecasts indicate that if Brazilian wheat production grows 10% per year, the yield can reach 20 million tons/year in ten years.
Increased wheat production can contribute to sequestrating the carbon released into the atmosphere, as indicated in the study by Embrapa Trigo and UFSM.
Wheat: capable of sequestrating more carbon than it emits into the atmosphere
As mentioned, wheat is a potential crop for the carbon market, especially as it can sequestrate more carbon than it emits into the atmosphere, per a study performed by Embrapa Trigo and UFSM.
According to Anderson Santi, the study assessed the differences between carbon emission and carbon retention (balance) in the wheat-soybean system by quantifying CO2 flows in business grain crops.
“During the production cycle, we noted that wheat absorbed 7,540 kg of CO2 per hectare from the atmosphere, neutralizing emissions from fallow periods (without land cover plants or crops that generate income in the form of forage or grain production) and ensuring the net supply of 1,850 kg if CO2 per hectare.”
Research findings also indicated the negative impacts of fallow on the grain production system about CO2 emissions.
Within just 30 days, fallow emitted 27% of all the carbon that wheat and soybean accumulated in 11 months of cultivation,” says Santi.
Good agricultural practices ensure wheat enters the carbon market
In the assessment of results, it was shown that wheat can remove more carbon from the atmosphere than it emits. It is cited as a “decarbonizing” crop, which helps to reduce greenhouse gases like CO2 in the atmosphere.
But, for that to confirm, Anderson Santi states that the management of the soil and crops must follow good agricultural practices.
“These practices should foster accumulating carbon in the soil, with attention to direct seeding and crop rotation. It is also important to look for rationalizing and reducing the use of inputs, such as fertilizers and pesticides,” highlights the researcher.
However, when wheat cultivation enters the carbon market, it will be assessed within the production system, considering not only its individual contributions but also those provided by the other components established by the farmer.
Within the carbon market, we did not have measurements for the wheat. However, some data, such as that obtained in the study, demonstrates the cultivation's relevance in accumulating carbon in the production system.
