How beef producers can take advantage of the burgeoning carbon economy

Even though ruminant emissions only account for a sliver of global greenhouse gases expelled, there is still much discussion around mitigating the enteric methane coming from cattle.

Emissions mitigation presents a unique opportunity for Canadian beef producers to be rewarded financially for taking action to reduce the amount or intensity of GHG emissions associated with beef production. Canada has implemented a federal Carbon Price, currently set at $80 per tonne of CO₂e and scheduled to increase by $15 per year to at least $170 per tonne in 2030. Presently, there are opportunities for feedlot producers to participate in carbon trading through a program in Alberta, with a federally-administrated national option in the works. In an example provided by the Alberta Government, beef producers could generate 0.1 carbon credits (estimated) per head per year¹. In 2030, that means that producers could see $17 per head or more for their efforts to improve carcass weights and feed efficiency – roughly $170,000 for every 10,000 head marketed. It is important to keep in mind that this is an estimated value – progressive producers could see more than this due to their efforts in improving feed efficiency through a variety of technologies and management practices.

The developing carbon economy

In addition to Alberta’s carbon credit program, the world of private carbon trading is emerging as large multinational corporations start to act on climate commitments made for 2030^2,3. Within the food sector, a large portion of the carbon that grocers and manufacturers are responsible for is sourced from either beef or dairy cattle (scope 3 emissions)^4,5. As a result, beef and dairy producers in Canada are well-positioned to benefit from this developing carbon economy, especially where companies that use the products of these ruminants have made climate-related commitments to their consumers and their shareholders.

Canadian feedlot producers can and should be pursuing options to monetize carbon emissions from their operations. Most producers already collect the data required; however, some may need to work to digitize their data capture processes to capitalize on this opportunity. Data management on ranches and feedlots is always improving, with many operations using automated data capture to ensure records are accurate. Considerable challenges still exist within the cow-calf sector due to the extensive management practices utilized by those producers.

Primary cattle producers should also be aware of their options when approached by large end-user companies looking for carbon credits to help meet their climate neutrality goals. Retaining control over one’s data and retaining the ability to sell to the most favourable carbon buyer will become increasingly important in this area.  

Reducing GHG emissions

In March 2022, Canada launched the 2030 Emissions Reduction Plan, which includes reducing methane emissions as a key part of reaching the emissions reduction target of 40-45% below 2005 levels by 2030 and net-zero emissions by 2050⁶. Beef and dairy producers will continue to face market and regulatory challenges to meet the reductions commitments – fortunately, there are pathways that provide financial compensation for practices that directly reduce enteric methane and the intensity CO₂e per kg of beef.

Beef producers in Canada have already made marked contributions to reducing the GHG emissions that cattle produce. The Canadian Roundtable for Sustainable Beef reported that between 2014 and 2021 emissions from beef cattle were reduced by 15%⁷, which puts the Canadian beef industry on track to meet its 2030 goal of a 30% reduction in total CO₂e compared to a 2013 baseline.

Practices that impact the emissions of beef production range from agronomic interventions that produce more feed with a smaller footprint to managing data. Generally, producers have opportunities to make differences in four areas:

Mitigation techniques for cattle farmers

Producers have a long list of techniques available to increase profitability, reduce environmental impact and enhance animal welfare. Some basic interventions include ensuring animals are well-cared for and healthy. Comfortable, dry, warm, clean animals produce more and spend less energy on maintaining biological systems, so good animal husbandry remains step number one.

Once the basics of animal care are under control, producers can look to interventions like vaccines against common diseases. Not only does a properly vaccinated animal have a greater chance of survival, but animals with limited disease stress can also better utilize energy from feed, resulting in greater growth rates. Avoiding disease outbreaks through vaccination gives producers peace of mind, and avoiding unnecessary mortality means that all the resources pooled into animal development pay off.

Finally, rations and feed additives can also play a role in GHG mitigation, especially at the feedlot level.

More than 90% of cattle on feed in Canada are fed monensin, a molecule introduced by Elanco to the Canadian market under the trade name Rumensin^® more than 40 years ago. Rumensin fed to feedlot cattle can reduce enteric methane emissions by up to 20%⁸ while improving the rate of gain and reducing the incidence of coccidiosis. More recently, Elanco introduced beta-modulators to the beef industry with Optaflexx® (ractopamine hydrochloride) and Experior^® (lubabegron fumarate). Experior is the first animal feed additive in Canada with an environmental claim – the reduction of ammonia gas from cattle on feed.

Take advantage of the carbon economy

While cattle emissions only account for a small percentage of global emissions, and the enteric and manure methane emissions are part of the natural cycle of carbon in the environment, Canadian beef producers are well-positioned to reduce their GHG emissions and capitalize on the burgeoning carbon economy.

To help offset the rising cost of inputs, producers should immediately start taking advantage of this additional source of income and add dollars to their bottom line.