Farmers Lose When Climate-Smart Partnerships are Frozen

Recent Executive Orders have led to the freezing of billions of dollars of already committed grant money, including funds for the Partnerships for Climate-Smart Commodities (PCSC), an innovative program to support public-private partnerships to develop markets for climate-smart agricultural commodities. 

Through PCSC, the US Department of Agriculture (USDA) has entered into agreements with 135 partner organizations ranging from large agribusiness corporations to farmer cooperatives, committing to more than $3 billion in federal funding matched by more than $1 billion in private funding. These agreements in turn provide vital support to American farmers, ranchers, and foresters who produce a wide range of crops, working with them to implement conservation practices and expanding market opportunities to help meet the increased consumer demand for climate-smart products. 

Freezing funds for these agreements breaks commitments to the partners who have already invested in the projects. It also affects the farmers who contracted with these partners and are now waiting for reimbursement for work that is already underway. With billions in committed funds left in limbo, USDA’s inaction places organizations and farmers into precarious financial situations and risks their ongoing stability.

What are Partnerships for Climate-Smart Commodities?

Partnerships for Climate-Smart Commodities (PCSC) is a program that provides grants to partners to implement extensive projects that develop markets for agricultural commodities produced with practices that reduce greenhouse gas emissions and/or sequester carbon. Partners received funding for projects that provide incentives for producers to adopt conservation practices on their lands, measure the climate benefits of those practices, and expand markets for the resulting commodities. 

PCSC grants were funded in two pools in 2022; together, these two funding pools invested $3.03 billion across 135 projects, representing a broad range of partners, commodities, and geographic coverage, and years of ongoing effort.

This post offers an updated examination of the PCSC grants, who benefits from them, and the importance of the USDA honoring its existing commitments. Information on PCSC agreements is available on the program dashboard and a June 2024 report offers an overview of the program’s scope. 

Diverse Partners in Climate-Smart Agriculture

PCSC agreements are with a broad range of partners representing a cross-section of American agriculture and food supply chains. The primary partners on PCSC agreements include: 43 nonprofit organizations, 39 for-profit businesses, 34 colleges and universities, 7 commodity groups, 7 state, local, and tribal governments, and 5 cooperatives. Commodity group partners include both checkoff programs that promote and research specific commodities (American Lamb Board, Iowa Soybean Association, National Pork Board) and industry advocacy groups (International Fresh Produce Association, National Sorghum Producers Association, USA Rice Federation, US Cotton Trust Protocol). 

The broad scope of partners shows that a wide swath of producers and crop types are benefiting from the investments made through this program. In particular, PCSC included an experimental round of funding designed for smaller organizations to ensure that grants reached a wider range of agricultural stakeholders. 

USDA reports that more than 14,000 farms are enrolled in PCSC projects and more than 3.2 million acres of working agricultural land is enrolled. As the funding freeze continues to jeopardize the sustainability of these projects, thousands of more farms are waiting in the pipeline for enrollment, which is paused as partners seek clarity from USDA.  

One fourth-generation farmer in North Carolina enrolled 90% of his acreage into a PCSC project offered in his region because it allowed him more flexibility than the USDA’s traditional conservation programming, including the ability to enroll a larger majority of his acres and a higher incentive rate for growing wheat cover crops. The project allowed him to focus on the soil health of his farm, reduce input costs, and have additional financial assurance during a time of high inflation and multiple hurricane disasters. With the project funding frozen, and having already done the work of planting cover crops in the fall, the farmer is facing uncertainty for the upcoming season where he planned to plant 500 acres of grain but is now unsure if it is financially viable. “We signed up for them, we did the work, we expect to be reimbursed, and we want to do the work throughout the continuation of the contract, which is supposed to end in 2028.”

In addition to the primary partners on PCSC agreements, USDA reports that agreements include: 276 nonprofit and commodity groups, 257 for-profit businesses, 98 colleges and universities, and 77 state, local, and tribal governments. These partners provide services such as direct technical assistance to growers implementing practices, market research, and other vital assistance that producers enrolling in projects need to succeed. This wide range of partners depend on USDA honoring its commitments to deliver efficient, cost-effective support to producers on the ground in the counties where they operate. By breaking agreements with these partner organizations, USDA will force a capacity reduction that would greatly degrade technical assistance services available to farmers at the local level, compounding the impact from cuts to USDA’s own staff in the field and undermining the current system of technical support for our farmers.

Examining the scope of funding for PCSC partners, USDA has directed the largest share of PCSC funding to private businesses, but also significant amounts to nonprofits, colleges and universities, and commodity groups, as seen in Figure 1. 

Figure 1: PCSC Funding by Primary Partner Organization Type

Among the 34 college and university primary partners, 10 were Historically Black College and University (HBCU) land grant universities, 1 was a non-land grant HBCU, 9 were land grant universities, 2 were Hispanic Serving Institutions, 1 was private university, and 11 were other public universities.

Figure 2: PCSC College and University Primary Partner Type

Climate-Smart Commodities: A Wide Range of Agricultural Products

PCSC agreements cover a variety of crops and a wide range of production practices. Notably, three-quarters of PCSC projects involve more than one commodity, and 29% of projects include at least five commodities. USDA generally considers any annual crops as agricultural commodities. The inclusion of a wide range of commodities, especially specialty crops, ensures that climate-smart agriculture benefits diverse farming operations, from large-scale row crop farms to smaller fruit and vegetable producers. Of the 135 projects, 102 of them worked with multiple commodities, and 39 of them covered at least 5 different commodities.

Figure 3: Primary and Secondary Commodities Under PCSC Agreements

Well-Established Conservation Practices

PCSC agreements help farmers to adopt long-standing and popular classic conservation practices. The most common practices in PCSC agreements include nutrient management, cover cropping, reduced tillage, and other conservation practices, which are also among the most widely adopted practices in programs like the Conservation Stewardship Program (CSP).

Table 1: Ten Most Common Practices Available in PCSC Agreements

Nationwide Reach: Every State and Territory Benefits

The impact of PCSC extends across all 50 states, tribal communities, and US territories. Every state has at least five PCSC agreements that include its region, and 34 agreements additionally cover tribal communities. PCSC agreements also cover US territories, including Puerto Rico, the Virgin Islands, Guam, the Mariana Islands, and Washington, DC. The map below shows the number of PCSC agreements that cover a state.

Figure 4: PCSC Projects by State

A significant portion of PCSC agreements have a multi-state impact, with 73% of PCSC projects covering multiple states and 44% covering 5 or more states. This wide reach ensures that climate-smart agricultural practices are adopted at scale, driving meaningful climate benefits while supporting farmers, ranchers, and food supply chains nationwide.

Figure 5: Number of States Covered by PCSC Agreements

Conclusion: Honoring Commitments to Farmers

The Partnerships for Climate-Smart Commodities supports farmers, ranchers, and foresters installing classic conservation practices that make their operations more resilient, efficient, and profitable. Like farm bill conservation programs, producers and partner organizations participate in PCSC projects voluntarily, choosing practices that work best for their farms. 

With over $1 billion in private sector funding committed alongside more than $3 billion in federal grants, these projects represent a new experiment in the kind of public/private partnerships that have enjoyed bipartisan support from agricultural policy makers for years. Freezing these funds places billions of dollars in limbo, disrupting carefully planned projects and breaking commitments to those who have already invested in these initiatives. At this moment, farmers have already planted crops and made purchases for the growing season based on anticipated funding that is now in jeopardy. To help them avoid economic hardship, partners are incurring costs with still no clarity from USDA on if they will be reimbursed, putting their organizations and the farmers they serve into financial precariousness. Already, as the funding freeze continues, farm groups are dropping out or considering it as they cannot pay staff nor the farmers they were working with in these agreements.

PCSC projects are not just climate projects – they also support farmers in taking on practices that make their operations more resilient, expand their markets to help increase their revenue, and work towards building the infrastructure for their long-term viability. Farmers, universities, businesses, and nonprofits have made significant commitments based on these agreements, and failing to follow through is failing our farms.

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