Carbon Neutral Farming: How Regenerative Agriculture Can Save Our Soil and Boost Profits

Welcome to another episode of the Climate Confident podcast. I’m Tom Raftery, and today, I'm delighted to be joined by Robin Saluoks, CEO and founder of eAgronom. Robin shares his insights on the crucial role of regenerative agriculture and how it can revolutionise farming.

We delve into Robin’s unique background, growing up in Estonia on a family farm, and how this experience, combined with his expertise in computer science, led to the creation of eAgronom. We discuss the significance of sustainable farming practices, including cover cropping, zero cultivation, and agroforestry. These methods not only enhance soil health and biodiversity but also help in reducing carbon emissions.

Robin explains the challenges farmers face in transitioning to regenerative practices and highlights the need for incentives and support from the food industry, banks, and governments. We explore how carbon income, better loan terms for sustainable practices, and public-private collaborations can accelerate this shift.

Key takeaways include the importance of data collection and verification for effective carbon reporting and how sustainable farming can be profitable in the long run. Robin emphasises the potential of innovative practices to rebuild soil health, especially in regions vulnerable to climate change.

For more insights on sustainable agriculture and how you can support this transformation, tune in to this enlightening episode. Connect with Robin on LinkedIn for further discussions.

Don't forget to check out the video version of this episode on YouTube.

Transcript

Robin Saluoks: 0:03

For food sector to truly become carbon neutral, eventually, these credits, or emission reductions, or additional removals has to stay inside the food value chain, but that's that's happening more and more. It takes time, but if you think about those big names, like Mars or Nestle or Coca Cola and et cetera, they all have their sustainability programs or regenerative agriculture programs.

Tom Raftery: 0:31

Good morning, good afternoon, or good evening, wherever you are in the world. This is the Climate Confident podcast, the number one podcast showcasing best practices in climate emission reductions and removals. And I'm your host, Tom Raftery. Don't forget to click follow on this podcast in your podcast app of choice to be sure you don't miss any episodes. Hi, everyone. Welcome to episode 171 of the climate confident podcast. My name is Tom And before we kick off today's show, I want to take a moment to express my gratitude to all of this podcast. Amazing supporters. Your support has been instrumental in keeping this podcast going. And I'm really grateful for each and every one of you. If you're not already a supporter. I'd like to encourage you to consider joining our community of like-minded individuals who are passionate about climate. Supporting the podcast is easy and affordable with options starting as low as just three euros or dollars. That's less than the cost of a cup of coffee and your support would make a huge difference in keeping this show going strong. To become a supporter. Simply click on the support link in the show notes of this or any episode. Or visit. Tiny url.com/climate part. Now. Without further ado with me on the show today, I have my special guest Robin. Robin. Or I come to the podcast. In fact, Robin, welcome back to the podcast you've been on before. So thank you for coming back to us. But would you like to introduce yourself for anyone who hasn't heard, you were seeing you on the podcast?

Robin Saluoks: 2:07

Yes thanks a lot for having me back. so, I'm Robin, coming from Estonia and I'm the CEO and founder of eAgronom. So my, my background is that I'm coming from the farming family. So my father has 1, 400 hectare organic grain farm and my grandfather has same size conventional grain farm. So basically I have been in the middle of those two worlds my entire life, but I ended up studying computer science. So, in 2016, my father needed a new tool to manage our family farm and well, I, I ended up building something to him and then other farmers wanted to start using this as well. And today there are already, I think, over 3000 farmers managing 1. 7M hectares in 15 different countries. So initially that was mainly as a farm management software to manage your farm, what crops do you grow? Give tasks to the tractor operator, government reporting, inventory management, et cetera. But already in the really first prototype, we had something called humus balance calculator. So humus is the richest part of the soil. Half of this is carbon. We had no business idea behind this. And frankly, no farmer was asking about this as well, but it was important for us to communicate that every decision as a farmer that you're making also influences your soil. And in the long run, it makes sense to take good care of your soil. So, we had this humus balance calculator in our tool already as a first, in the first prototype and then, and it was part of our core mission to also promote the soil health and so on. And we always wanted to do this, but then in 2021 we, we had an opportunity to launch our carbon program to work with offsetting, insetting, food companies, landlords, banks all of the different stakeholders to bring incentives to farmers to promote soil friendly farming practices and, and, and really to accelerate the transition toward sustainable farming

Tom Raftery: 4:21

Okay. And you said you were based in Estonia and there are 3000 farms or farmers on your platform now. Are they all based in Estonia?

Robin Saluoks: 4:32

No, they are based in different countries. So, our biggest markets are actually Poland and Spain. But, but since, well, we, we say that since we are farming well, Together with our clients in Estonia and in Spain, then we have two of the most extreme conditions in Europe. So you have Estonia when there is really wet and cold and et cetera, and then you have Spain on the other side of the Europe that is really dry and warm. But yeah, we are operating in 15 countries mainly in Europe, but also in three African countries. Kenya, Rwanda and Tanzania.

Tom Raftery: 5:07

Wow. And what kind of crops are the farmers on your platform growing?

Robin Saluoks: 5:15

Mainly arable crops. So rotational crops like wheat, corn, beans, oil crops, and et cetera. But in Spain, we are experimenting with, a small volume of olive trees as well.

Tom Raftery: 5:27

Oh, nice. Yeah, good there. I'm surrounded by them here in Uh, This is the, one of the, the, the big regions for, for olive production. Nice. So what are you doing for farmers now? If I'm a farmer on your platform, what do I get from eAgronom?

Robin Saluoks: 5:46

Well, we, we, begin already before you are on our platform. So the core of our business is promoting regional regenerative agriculture practices. So that means, and in the end, well, platform, this is just a tool that helps to do it, but what we do is we together with our local partners, we set up field trials and events in all of the markets we operate. And these are these are to show the farmers how in their specific region, it is possible to apply profitably some practices that take good care of their soil and increase their profits in the long term even more. So, this might be experimenting with different cover crop mixes some mixes work better for one region. And another mix works better for another region. Then all. Yep.

Tom Raftery: 6:36

you might explain for people who are listening what a cover crop is. I come from an agricultural background. I know, but maybe not everyone listening does.

Robin Saluoks: 6:45

Ah, it is really. Of course. so I guess if you drive around, then in the autumn, quite often you see that there is nothing growing in the land. And this is because the next crop on that land is going to be a summer crop, though it is going to be seeded in the spring. And the harvesting already happened. So you see, basically, you see black or brown soil. So we are using this moment over there to grow something as a cover crop. Just to cover the land and through photosynthesis increase more biomass and capture more carbon that will later turn into the soil. So it has, I guess, two or three positive effects. One, your soil is covered, so the wind erosion is not throwing the soil away. Secondly you are adding more carbon because plants are growing and with photosynthesis, you're removing CO2 from the atmosphere and you're adding more carbon later to the soil. And we can speak later why this is important as well. And thirdly, you will add more of other new nutrients as well. The most straightforward nutrient is nitrogen that some plants are working together with bacteria to fix nitrogen from the air so that the next plants can use this, but the plant roots are also going deeper in the ground to make other nutrients also available for the next crop. So it has several benefits. And, but the thing is that farmers they don't, they haven't done cover cropping that much, as much as they do the main crop, cash crop. So, that's why we are over there experimenting with different ways to grow it, different mixes, but also different ways to implement this. For example, one of the things that we have been experimenting now is seeding the cover crop during, exactly before harvesting, during your last spraying round. So that means that you already put the seed in the ground and after harvesting, it gets light and the cover crop starts growing really quickly. So that again speeds up the growth and you will get more biomass. And some of the things we do work and some don't. And both are really important for farmers because then they see that we have done those mistakes for them and they don't have to do those expensive mistakes.

Tom Raftery: 9:11

Okay. Interesting. And you mentioned regenerative agriculture. What exactly is that?

Robin Saluoks: 9:18

Well, I guess this is a really broad term, but in our mind, it makes in a way, it, it, it, it may, the main goal over there is to farm and grow food while being in synergy with the nature. So taking good care of your soil. So today the conventional farming is farming, unfortunately in a way that you will have, you have less and less carbon in the soil every year. So we are using this really slowly. You can build up the soil later as well, but it takes time. So basically, we're using these resources. It's like burning oil. We are using the soil as a resource and you will have less and less soil. In regenerative farming, you will have more and more. The other part of this is increasing the species richness, the soil life and there are several researches that if everything else is same, then the soil that has more earthworms will have a better yield as well. So these things these things matter. And then, and then, well, key part of it is also finding ways to reduce inputs. So how to, how to get the same kind of yield while reducing the amount of fertilizers and, and chemicals that you use. So, so taking care of nature is really important. But we believe, and many other farmers also do believe, that as important is also to make it profitably and to continue growing the food as well. Because the global population is growing and we will need more and more food even if we reduce food waste, go more plant based, etc. We still need more and more food. So, so we, we kind of just, well, reduce the profitability or reduce the yields. We have to find a way to maintain it, but to make it in a sustainable way. And it's possible. We see it, but now it's all about scaling it, promoting it and, and accelerating this transition.

Tom Raftery: 12:30

Okay, and from a practical perspective, what kind of practices are done to make farms more or agriculture more regenerative?

Robin Saluoks: 12:39

Mm-Hmm, , two of the most common ones is adding cover crops, so increasing the biomass and then also, second one is reducing cultivation to the place that you don't cultivate at all, zero cultivation. So, it is tricky from one side, because historically the cultivation happened to release some nutrients, to fight with weed, so you have to find other ways to deal with this. One example is also crop rotation. If you grow only one crop all the time, then weeds get used to this. But if you change crop every year, that means that the environment for weed is also changing. So this helps to fight both weed, but also different insects and plant diseases as well. In incorporating animals to accelerate the process of rebuilding the soil. And, and these, these are the most basic ones. But we also see that, unfortunately, this is not enough. We have to go beyond this even though those first ones that I mentioned are fairly easy to implement compared to some other practices. So, they still require new knowledge but at least our team has a capability to help farmers to implement those profitably. But then there are also more challenging ones like agroforestry. So, continuing the food production while also implemented some trees and the challenges with this is that well, implementing trees may have some extra cost and may have some negative impact on, on the crop growth and, and et cetera. It can also have some positive impact if you do it in the right way, but this is a really well. Perhaps not a novel practice because agroforestry has been over here for, I don't know, from the beginning of times, but it hasn't been implemented in a commercial farming. And, and because of this, we do, they have to set up field trials to find in different regions, ways for farmers to implement it and hopefully step by step, let's say in 2027, 2028, 2029, and so on farmers will start implementing it more and more. Because this is the only way you offset the emissions from the animal production as well, which is, well, we can do a lot to reduce, but we will never reach to zero emissions. So we have to find a way to balance it out.

Tom Raftery: 15:12

And explain for me, like I'm a simpleton, how does agroforestry help? Is it just that you're planting some trees and therefore they're capturing carbon and therefore you can claim carbon credits for the capture of that carbon? Or is there some other benefit that I'm missing?

Robin Saluoks: 15:32

Yeah well it has some positive sides and it has some negative sides. So, well, one of the very clear positive ones is that, yes you will store more carbon. But but then there are also some others in in some areas, it can work as a wind break. So, when it's really windy, and that's interesting plants can be stressed out because wind as well. So, if it's really windy you will get less yields. So, in some places that can actually increase the yield because of this. In for some specific crops especially in the south and warmer regions. The shadow actually helps. It provides protection from the, from the sun, and then you go to Estonia or Sweden, where you also operate and shadow is a problem, especially in the spring, where you see that and near forest, the snow is always melting the latest and et cetera. Then. It can increase the total food production per hectare if the trees that you implement are nut trees or fruit trees. So, you can then grow food on top level and then on the growing level as well. The total food production is same or, or is, is even growing. But the challenge is that in that case, farmer has to set up the entirely new operations. How do I harvest nuts? Where do I sell it and et cetera. So, there are plenty of challenges with this. There are some trees that are also fixing nitrogen from the, from there together with bacterias so you can add more nutrients. And quite often, well, you can also choose the tree species that, where the roots go deeper in the ground. And then you get nutrients from there and then with leaves, you can bring it in top so that it's actually available for the plants as well. And one of the most interesting, like agroforestry types that we want to experiment, especially in Spain, is to use trees to rebuild the soil. So, basically, even, even to have like, to have a bunch of trees growing on the, on, on the field, like the line. And then when they are, let's say, three to five years old, so you have to cut it quite early. So, then you cut it and you spread it around on the field to put some more, more organic matter to, to accelerate the, building of the organic matter in these really dry regions. But at the same time this is also something that has not been proven in a large scale today.

Tom Raftery: 18:09

Okay. And just from living here in Andalusia in the south of Spain and seeing a lot of the olive plantations or olive groves that are around, it always makes me kind of curious because when you see plantations or groves of olive trees, the soil underneath them is generally has been cleared. So it's, there are no plants underneath them and it's done on purpose, you gotta think, by the farmers because, I don't know, are they spraying or are they ploughing or what they're doing, but naturally, there should be weeds, grasses, things like that in the soil underneath them, but there's not. And surely if they left those plants grow under the olive trees, they would A, be enriching the soil and B, increasing the biodiversity and C, you'd think increasing the yield of the olives consequently. Am I misunderstanding or?

Robin Saluoks: 19:16

You, you're really correct from many aspects. First of all, that's, that's true. Quite often farmers are even cultivating under olive trees or at least praying to kill. And there are some reasons why to do it. I can mention in a moment. And, well, having some plant cover would have several benefits, like, increasing the nutrients in the soil in the long run, biodiversity, plant health, and et cetera. There are a few reasons that, why farmers are still doing it. One, and the re, well, it's actually, it makes sense a lot, is the risk of wildfire. So, because the grass gets really dry, and imagine if your plantation gets burned down, so this will be really expensive. And then in the short run, you actually, in a really short one, in a one year perspective or a few years, you, you might have you might have well, competition for the olive trees, if you have some other plants below this as well, competition to get nutrients, competition to get water and et cetera. In the long run this competition won't be a problem because you rebuild the soil and your water holding capacity increases. You actually have more nutrients in the soil, but since quite often farmers have to live well, from one harvest to another harvest, so they really have to maximize the next income to pay the debt or land rent or whatever, then this becomes a problem and that's why some incentives are needed to accelerate the process of changing and application of soil friendly practices.

Tom Raftery: 20:54

Okay, and you're mentioning incentives now, and you also said earlier that it needs to be done profitably. So where are these incentives and profits going to come from?

Robin Saluoks: 21:06

And first of all, still the key focus is in implementing the practices in a way that they will quickly become profitable for you. With no cultivation at all, it's easy. You reduce a lot in the fuel cost and, and soon you will start actually reducing your like the chemical cost and fertilizer cost and et cetera man hours, you will have, you, you have to do less work on the field and so on. But, but you can do it also in a way. But your yield is reduced, and then that's a problem. With cover crops the benefits perhaps come a bit later, but still the problem is that if you do it in a bit wrong way, then you can also influence negatively your yield for the next year, but the, but the key and kind of 90 percent of the, or even 95 percent of the benefit can come from practice implementation itself. But then to but, but the problem is that this comes in a bit of not in the 1st year, maybe, but in the 2nd, 3rd, and so on. So, to accelerate the process and to give additional incentives to reduce risk to cover some of the costs there are different schemes that are available and 1 is carbon income. So, I think today is still the probably today still the most common kind of carbon income is through offsetting schemes where farmers change practices, store more carbon in the soil, and these credits are purchased by some companies from many industry airlines, banks you name it. But the thing is that for food sector to truly become carbon neutral, eventually, these credits or emission reductions or additional removals has to stay inside the food value chain, but that's that's happening more and more. It takes time, but if you think about those big names, like Mars or Nestle or Coca Cola and et cetera, they all have their sustainability programs or regenerative agriculture programs. The thing is that the scale of the, those programs are they're not that full scale, so that not all farmers can benefit from those already today. And then many farmers also well sell their products to some other companies who today don't have the regional program set up yet. So the offsetting part is still really important. So that we wouldn't have to say to farmers that, Hey, stop, we don't, we cannot subsidize you today. You have to wait for three years and then the players in your value chain, your clients who buy grain from you or credit you compensate, but today you have to wait. So we don't want this to happen for this offsetting is really good transition financing, but but at the same time eventually those credits have to stay inside the food value chain. And now on top of this there are also some other schemes like well, governments are subsidizing certain practices and the EU has stated very clearly that private support and public support have to work together. We don't have two planets like a private planet, and then the public planet. It's one planet. And we all have to, so all of our efforts have to go and support the same emission reduction targets that banks give a bit better interest rates. So, if you buy electric car, it's quite common already, but we work with some banks who do they give better terms also to sustainable farmers. And in some cases, landlords do the same, but, but the biggest eventually, I think the biggest impact will be done by, by the food sector itself. So, and then end consumers, they will get food that is grown with lower emissions and in a sustainable way.

Tom Raftery: 24:57

Okay, and are the food companies today getting involved with farmers, or is this something that's going to happen in three, four, five years time?

Robin Saluoks: 25:11

I think today in most cases it's either it's piloting,

Tom Raftery: 25:16

Okay.

Robin Saluoks: 25:16

in some cases it's already scaling a bit as well. But but yeah, it, it, the scale of this, you could call it like a pilot or, or like maybe, maybe slightly beyond pilot in some cases where the scaling begins. But one of the challenges is that quite often food brands are actually not purchasing directly from farmers. So, you have, you can have maybe five different companies in the middle, so you have farmer, then you have some farmer union or grain buyer then you have different processing companies. Then you have some company like food brand, let's say Coca Cola or Pepsi. Then you have a grocery store. So the chain is quite long. So it's easy to set up pilots. But then, if you actually want to start scaling it, it takes time. That's why we also quite often work with those who are farmer plus one companies. Like, well, let's call them like, like grain buyers or farmer unions. We say to them that, hey, let's bring farmers to to together to apply sustainable farming practices today. We have initially buyers outside of the value chain to incentivize this change. But you have a right to 1st refusal for those credits so that eventually you can keep them and together we can find in your value chain those sponsors are ready to incentivize this. So, in that way, we can already, well, accelerate the process a lot, because then the goal is same for everybody to change the value chain emissions and to make them lower to apply soil friendly practices. But it just takes time for a food brand to get with their initiative to all of the farmers.

Tom Raftery: 27:01

Okay, okay. And I assume then that on the, on your own platform, on the eAgronom platform, farmers have a way to baseline measure and report their emissions.

Robin Saluoks: 27:17

Yes. So, we, yeah the first thing that we have is a, a really good tool for the data collection to make. That's something that farmers don't like at all. And this is a bigger challenge in this industry than you could ever imagine before you join it. But we need, we need good quality data. We also kind of ask like five questions, and then pay the incentives based on this. So that would be borderline greenwashing. So we have, we have to go into details. So automating and as much as possible is a key over there. So that's that's one. Second part is verification. So with satellites, we verify that the most important data that farmers gives us correct. And then the third part is the reporting. So, we have reports that are suitable for the carbon offsetting programs like for Verra Auditor, for example, but then also for food companies, for banks for governments, landlords. So all different kinds of reports and yes, in the end farmer gets overview of their baseline emissions and then how it has been changed in time.

Tom Raftery: 28:32

Okay. And when you say suitable for banks as well, I'm assuming then that if a farmer can show that their emissions are lower, their cost of capital, their cost of loans, et cetera, should be reduced, no?

Robin Saluoks: 28:46

In some cases. So, probably in five years, it will be like a standard. Like today, if you, if you buy electric car, I think in any bank, you get better terms. The leasing will be a bit smaller. The problem with farming is that it's more difficult for banks to understand which farmer is sustainable and which farmer is not. So that's why they, they, they have postponed this product offering in some cases, but we work with few banks. And we all follow. In European Union, there is something called sustainable finance taxonomy. So this is describing for different industries which, what are the sustainable practices. And farming is not part of the taxonomy yet, but it was part of the proposal. And we, so today we are following the proposal and unfortunately banks cannot claim it as a green loan, but they say that they already want to get started today, so they want to set up all the processes and so on so that later when it becomes official, they already have a head start compared to others. So, and today, the difference in, capital is not that that big as well. It's like a 0. 3 percentage or something like this. But it's still something so it adds up together with other things and it's really important message. That Hey, this is what you expect. Today it's the difference is small, but in the, maybe in 10 years you can only get the loan if you apply certain practices,

Tom Raftery: 30:21

Okay. And in some industries as well, this would have an impact for insurance rates. Is that similar for agriculture or does not count for insurance at all yet?

Robin Saluoks: 30:30

Well, it, it certainly will. I think insurance in Europe is less common than in North America, that's that's 1 thing, in agriculture, but it certainly will for 3 reasons. 1 same as banking is that eventually those companies will their shareholders will demand and the companies will finance them will demand that they have to move their portfolios towards more sustainability. That's one. Second is the regulation risk. So in case of bank, let's say the farmer who already applied sustainable practices has a smaller risk that the farmer compared to the farmer who just has to start this, let's say, in a few years, so, every change is a risk. But then, especially in the insurance soil friendly practices are also reducing the risk of drought. So, if you have a really long dry period then you have more carbon in the soil, that means your soil water holding capacity increases, and you can survive this really long dry period. So basically these practices reduce the risk of damage. and we know that because of the climate change, there will be more and more of those dry periods. And and that's one of the biggest risk for the companies who insure.

Tom Raftery: 31:51

Okay. Okay. And where is all this headed? I mean, agriculture is supposed to be net zero by 2050, as far as I know. Is, is that likely to happen, do you think? Will we be able to get there?

Robin Saluoks: 32:07

Yeah, it is possible. Especially in. In Europe, and but I think in other countries as well, and other regions as well, like, we are operating also in Africa. So, in Africa, the main driver is not maybe the government, but it is that the soils are really fragile. But because of warm temperature you can also rebuild it faster than in, in other regions. So the benefits of those practices are even bigger, but we believe that this possible and and, and especially important is to not only rely on the practices that are there today. But also to innovate and find some other practices to make them scalable as well, like agroforestry or, or some, some, some other more challenging practices.

Tom Raftery: 32:58

Okay, cool. We're coming towards the end of the podcast now, Robin. Is there any question I did not ask that you wish I did or any aspect of this we haven't touched on that you think it's important for people to be aware of?

Robin Saluoks: 33:13

Now, I think it was really good conversations and well, I guess if there are any food companies who are listening, then I would say that their work is really important in making this change happening. So agronomically, practice change is happening and it's possible the sustainable and soil friendly practices, and it's even inevitable that farmers will change their practices. But if you really want to meet the timeline, then we have to have some extra incentives. And this is where food sector can really help. Is already helping but, but, but that, that help has to grow and and go beyond what we do today.

Tom Raftery: 33:53

So there needs to work harder is essentially what you're saying. That would be on the food company's report card. Needs to work harder.

Robin Saluoks: 34:00

Yeah, well, I guess we all have our role to play.

Tom Raftery: 34:02

Yeah. Great. Robin, if people would like to know more about yourself or any of the things we discussed in the podcast, where would you have me direct them?

Robin Saluoks: 34:10

I think LinkedIn is the best way to approach me.

Tom Raftery: 34:14

Okay, I'll put your LinkedIn link in the show notes so people can find you there. Great. Robin, that's been really interesting. Thanks a million for coming on the podcast today.

Robin Saluoks: 34:23

Thanks a lot.

Tom Raftery: 34:25

Okay, we've come to the end of the show. Thanks everyone for listening. If you'd like to know more about the Climate Confident podcast, feel free to drop me an email to tomraftery at outlook. com or message me on LinkedIn or Twitter. If you like the show, please don't forget to click follow on it in your podcast application of choice to get new episodes as soon as they're published. Also, please don't forget to rate and review the podcast. It really does help new people to find the show. Thanks. Catch you all next time.