This is the third in a series of articles focusing on PFC Director Gary Price and his family’s 77 Ranch in Texas.
Gary Price, owner of 77 Ranch in north central Texas, has placed more and more emphasis over the years on what the consumer wants so that he can get the best price for his cattle. His first stop on this journey, which began about 10 years ago, was to convert his herd to crossbred Angus cows that can produce Certified Angus calves, which “has been great.” His cattle are also certified all-natural, meaning no antibiotics and hormones, and he has systems in place for tracking individual animals in the event some require doctoring.
To meet the demand for beef from Europe, Gary must be able to verify the age of his cattle as well. Since the mad cow disease scare, most countries in Europe will not accept cattle over 30 months old (as the disease is very rare in cattle this young). Likewise, restaurant chains want to be able to name and trace the beef they serve to its place of origin.
“We have nothing to hide,” says Gary. “We hire IMI Global out of Denver as a third-party auditor and another company out of Washington, DC verifies us on animal welfare. All of these things add value because they are what the consumer wants, and they separate us from those who sell beef as a commodity.”
Ecosystem services markets for the benefits that working grasslands provide
About three years ago, Gary began participating with a new partnership working to establish a market for ecosystem services provided by cattle and grasslands. “Ecosystem services,” explains Gary, “ are what the land provides besides food and fiber, benefits such as clean water and carbon uptake. With climate issues, it’s all about removing CO2 from the air. Grass is great at sequestering carbon, which ends up stored in the soil.”
For many years Gary has collaborated with the Noble Research Institute based in Oklahoma, and for more than three years, he has served on the steering committee of the Ecosystem Services Market Consortium (ESMC), a 501-c-3 based in Washington, DC. The ESMC’s focus was initially on how to create carbon markets for the carbon that is stored in well-managed grassland, but over time their focus has evolved to include water quality and quantity. By capturing rainfall and storing water in the ground, grasslands allow more water to eventually reach and replenish aquifers, something that benefits everyone.
Consumers are driving change toward improved stewardship
Gary says consumer demand for food that comes from good stewardship has completely changed the way large corporations, such as McDonalds, source their products. He knows because he was recently recognized as one of McDonald’s first Flagship Farmers in the U.S., a program that enables and encourages farmer-to-farmer sharing of sustainable practices. “What’s really driving this is partially the customers who are concerned that corporations like McDonald’s purchase beef from those doing right by the land. In addition, large hedge funds won’t invest in companies that are not taking care of the land. Stock holders and investors want to know what you are doing.”
The 77 Ranch is on track to become the first ranch in the US to sell carbon credits through the Ecosystem Services Market Consortium. “The timber industry has been selling carbon credits for a long time, but these will be the first based on grass production. We anticipate that within the next month, there will be a big announcement.”
Noble’s role in this project has been to conduct soil sampling at the ranch to measure deep carbon levels at random sites, conduct vegetation sampling, and model how much carbon will be stored over a given time frame under specific management. The research provides credibility to the market, which then allows large corporations to verify their actions to stockholders.
The first market in the US to sell carbon credits from grasslands
As the first market in the US to establish and verify carbon credits from grasslands, the ESMC had to address two major issues: additionality and permanence. Additionality ensures that when a company purchases credits for carbon sequestered in the ground, it is actually new carbon that adds to what was already there. Initially, this made the most degraded land the most desirable for sequestering carbon, but threatened to penalize those who had been doing good work already. This problem was solved by allowing a three-year “look-back” period for accounting carbon sequestration.
The second issue, permanence, ensures that sequestered carbon will remain in the ground over the long term. However, “most landowners are not going to be interested in agreements selling ecosystem services that are perpetual,” Gary explains. “We decided the agreements should be in the 5- to 10-year range with options to renew.”
The bottom line is that ecosystem markets provide a new way to incentivize conservation work. “It’s really not true that it costs too much to manage for healthy soils, but change is difficult. Most of the time when I have found problems in my ranch management, I’ve discovered I could often find the source of those problems by looking in the mirror!”
Read the rest of the series:
Article 1. Covid Concerns on the Ranch: Restaurants, processors, and the closeness entailed in loading a cow into a trailer
Article 2. From Cotton to Bermuda to Native Grass: the 77 Ranch of North Central Texas
Article 4. The 77 Ranch Ethos: Reverence for the Land and Partnerships with People