Posted December 15, 2021 | By: Nutrien Ag Solutions
"The Future. Faster": Episode 11
Nutrien Ag Solutions can't get to its ambitious goal for sustainable ag program and practice enrollment all on its own.
It's going to take a dedicated group of partners to reach 75 million acres by 2030... not just grower and industry partners, but NGOs too.
So in this episode, Sarah Fox, Director of Sustainable Ag Strategic Partnerships at Nutrien Ag Solutions, joins us to lay out why it's so important for the company to foster these nontraditional relationships. We highlight that growers have often been on the front lines of sustainability, but how Nutrien Ag Solutions and its new partners are making sure that the ag industry is better positioned to tell its ESG story to the world.
And, it's that time of year when growers can enroll in sustainable ag programs for the year ahead. Tom and Sally talk through some of the best options available to them, and highlight some factors that growers should consider as they weigh their options.
Episode Transcript
Sarah Fox:
We know there's a lot of really good work already happening out there around sustainability and sustainable acres. So the existing practices and programs and technologies that are happening, we want that information and we need that information so we can share it.
Dusty Weis:
Welcome to The Future, Faster, a sustainable agriculture podcast by Nutrien Ag Solutions, with our very own Tom Daniel, director of retail, sustainable ag and Dr. Sally Flis, senior manager, sustainability field. This is your opportunity to learn about the next horizon in sustainable agriculture for growers, for partners, and for the planet. To us, it's not about changing what always worked. It's about continuing to do the little things that make a big impact.
Dusty Weis:
On this week's episode, we'll be joined by Sarah Fox, director of sustainable ag strategic partnerships at Nutrien Ag Solutions. She'll lay out the company's plan for leveraging partnerships to help get it to its goal of adopting sustainable agriculture products and practices on 75 million acres by 2030. But if you haven't yet, make sure you're subscribed to this podcast in your favorite app. Also, make sure you follow Nutrien Ag Solutions on Facebook and Instagram. I'm Dusty Weis, and it's time once again to introduce Tom Daniel and Sally Flis. And Tom and Sally to kick this one off, let's take a look toward 2022. When as we look ahead to next year, are there any types of sustainable ag programs opening soon for enrollment that we ought to be aware of? And if so, can you tell us a little bit about them?
Sally Flis:
This year we'll have our nitrogen management projects where we're looking at changing nitrogen management practices in the field through both rate changes and the addition of nitrification inhibitors or slow controlled release fertilizers in order to bring down those nitrous oxide emissions, and hopefully get growers that extra value payment of generating some verified carbon credits in the marketplace. Tom, do you want to talk about how this value to the growers going to be generated?
Tom Daniel:
Yeah, Sally, so we're using some established protocols today that are... We're basically going to take information and data from the grower. We're going to baseline it on a three year history looking at what the grower has used by field, by crop, as far as his nitrogen rates from the past, we'll set a baseline and then we'll be looking for overall reductions by the grower of at least 5% of a nutural reduction that we can then qualify him for these different outcome based programs.
Tom Daniel:
So depending on the conditions of the farming operation whether or not he's using no-till or converting to no-till, there's several different measurement pieces that we have to take into account Sally. And it could be there's certain geographies of the country that we may not even be able to allow customers to participate simply because the data's not available for them to do that. But when the data is available, then we can actually measure or model outcomes for those acres and we can actually generate scope one offset for that. So we create a measured outcome that actually creates value for the grower. Sally, the good thing that I like about these different programs is that they don't require a multi-year type contractor or anything. So what are some of the requirements outside of that, around the grower process of this?
Sally Flis:
Yeah, Tom, really compared to a lot of other programs there's a lower eligibility requirement here and we get a little bit easier additionality than we see in some of the other programs that we are offered around carbon credits. And the big difference there is with nitrogen management, we're always talking about an annual practice, right? It impacts the crop that we're harvesting that year. The credit follows that crop. So once the crop becomes part of a product, we really kind of use that credit up. So the eligibility is going to be at a county and a crop basis. And the three crops that will be working in this year are corn, both corn grain and corn silage, cotton, and primarily winter wheat. There could be opportunities for spring wheat, but most of the acres that we're going to look at this year will be winter wheat. And so for winter wheat, it always helps me to think about the cropping season for that winter wheat.
Sally Flis:
So for winter wheat, it could potentially be winter wheat that was planted this fall, so 2021 fall planted, harvested in 2022 if there's an opportunity to still make a rate adjustment in the spring months of that crop, or it could be crop that's planted in the fall of 2022, but not harvested until 2023 for that winter wheat, depending on how the nitrogen management works for that grower. The minimum or the way we handle additionality in this nitrogen management piece is it's got to be a minimum 5% rate reduction. Now the 5% rate reduction doesn't get us the biggest carbon credit, we'll be developing and hopefully soon releasing some tools that'll help a grower and a crop consultant take a look at where they can get to with different management scenarios. So there's, as you mentioned, Tom, three different things that impact the amount of emission reduction we get, it's that rate reduction.
Sally Flis:
So the percentage reduction we make, whether or not the grower uses a nitrification inhibitor or a slow controlled release fertilizer. And then what stage of tillage management are they in? So we were looking to get the biggest emission reduction value, growers that are years plus in no-till or growers that are still doing tillage. There's a big impact in the amount of emission reduction we're able to calculate when we're looking at they take a 10 year transition period. So if you're anywhere from year zero to year ten in transitioning to no-till, that's a field that we wouldn't want to include just because the impact to that tillage practice on it. It is field by field like all these carbon programs are, so you don't need to enroll a whole farm. You can just pick and choose fields where you might want to try something new or where you know you're going to be making that practice change.
Sally Flis:
Like you mentioned, Tom, it's a shorter term agreement. It's a one year contract. We will use the Agrible tool as the data tracking. And also some of our other tools like Echelon in order to track and manage payments and implementation and products used. Enrollment is already kind of rolling a little bit. Tom, what is the impact for financial decision scenarios? Some of the stuff that's happening on the ground right now, we hear it a lot, this high fertilizer prices that are out there right now, how can we tie some of the decisions that are being made because of current market conditions to opportunities like a program we have with the nitrogen management?
Tom Daniel:
Obviously, we've got a lot of growers that are looking to optimize their fertilizer usage, especially around nitrogen right now. With petroleum costs where they are and all those type things, we're seeing a rise in fertilizer cost. So growers are taking a look at opportunities right now, how can they reduce the amount of fertilizer usage on the farm or increase their nitrogen use efficiency for instance, and still maintain of course their yields. And so there's multiple different opportunities around some of the that today. We're looking at a lot of growers taking a look at nitrogen stabilizers, for instance, Sally, that maybe in the past they would've just added more nitrogen for production, but now they recognize the need that overall cost to the operation, it's better to reduce nitrogen. So if a grower's out there, we talk about a 5% reduction is the minimum to participant in these nitrogen management protocols.
Tom Daniel:
But we've got a lot of growers that are looking at 10% or 15 or 20% reductions on the field. They need to look at opportunities like the nitrogen management protocol that we have to take advantage of those payments. They may not be huge payments, but if you're going to go be reducing your nitrogen rates anyway, it's a good time to be participating in those things. And obviously if we get the baseline set, there'll be opportunities in the future for future payments depending on how we measure those going forward. So I think this is a great opportunity, Sally, especially when we've got everybody looking at reductions, how can we go ahead and add in some additional incentives for the grower? So Sally, I ask you this question, we're talking about calculated values. I mean, we've done some work on these NMPPs for 2021. We've discussed a little bit of the range, but these payments are not huge payments, but in certain parts of the country, there are better results that we're seeing today.
Sally Flis:
Yes, when we kind of modeled all the fields that are enrolled in NMPP across the country, that nitrogen management protocol, we looked at all of them at that .5 or that 5% reduction. And we got some low numbers, .008 was some of the numbers we were seeing for a mission reduction. But as we started to verify that data, so the actual rate reductions that growers made and the use of the nitrification inhibitors or slow controlled release fertilizers then we start to see the higher values where we're getting up as high as .35 tons per acre of a mission reductions where we have a rate reduction and the use of a nitrification inhibitor in the field.
Sally Flis:
So there's a lot of room there to make management decisions. But like you say, Tom, the real opportunity is if you're at a position right now where you're already considering a rate change or a practice change for this upcoming cropping season in one of these three crops again, corn, grain or silage cotton or winter wheat, then why not get a little bit more of an opportunity and get some experience in what the data lift and requirements are for participating in something like carbon market.
Tom Daniel:
So Sally, you were talking that enrollment... We've already started enrollment in this process for 2022. We do have a plan to hopefully shut this off though by April the 15th, because we want growers to go ahead and build into their cropping plans right now, the nitrogen management reductions that they're going to plan for the farm, right? So, this isn't a decision you make in June, it needs to be made now as to where you did with this. We definitely want to get growers engaged and we are still calculating that for 2022, it's a $15 per ton value on carbon that we're calculating. So a guy that's doing a .2 or a .3 there's 3 or 4, or maybe a little more dollars per acre that can be generated back just from being willing to record the data and enter it into one of these protocols. So I see 2022 as being a great opportunity for growers to take advantage of farm practices. They already plan to implement. They're not really making new change, they're just going to implement practices that they can actually generate a revenue from a nitrogen payment.
Dusty Weis:
Well, and Tom, these are some rate opportunities. They're certainly not going to be around forever and so if somebody is interested in learning more and getting involved, what's the best way for growers to show interest in programs like the nitrogen management program or the traceability project?
Tom Daniel:
Obviously one of the best ways is to get onto the Nutrien Ag Solutions website and get into the Agrible platform from there and enroll yourself in the Agrible platform and just sign up for a free account and then enter nutrien carbon, all lowercase in the codes and... In those situations, Dusty, the grower immediately then will be tagged and we'll know that he's looking for a possibility of a program and then we in turn will contact the grower through one of our crop consultants and make sure that he's interested or could qualify for one of these programs.
Dusty Weis:
Well, it's the time of season to be thinking about those things. So certainly a timely conversation here. And in past episodes, guys, we've talked as well about some of the really big goals the Nutrien Ag Solutions has for expanding its sustainability footprint. And I don't have to tell you guys that there's a world of difference between setting a goal and meeting a goal and so coming up after the break, we're going to talk to one of Nutrien Ag Solutions, frontline experts on getting from goal to execution. That's Sarah Fox coming up in a moment here on The Future, Faster. This is The Future, Faster, a sustainable agriculture podcast by Nutrien Ag Solutions. I'm Dusty Weis along with Tom Daniel and Sally Flis and we're joined now by Sarah Fox, director of sustainable ag strategic partnerships at Nutrien Ag Solutions. So Sarah, thanks for joining us.
Sarah Fox:
Thank you for having me.
Dusty Weis:
Sarah, the last episode of this podcast, we spoke about Nutrien Ag Solution's goal of adopting sustainable and productive agriculture products and practices on 75 million acres globally by the year 2030. That's a big number to say the least, so could you start out maybe by explaining what exactly that means?
Sarah Fox:
Yeah, the sustainable acre, it's productive and sustainable acres and that goal is really a goal set by our ESG group for shareholders. So it's a way that we communicate with our shareholders on our climate risks and opportunities and so that's really what the goal is around. The retail business however though, it's the group that makes it happen. And so we're the ones who actually define what a sustainable acre is in the field and then measure and track it and help report up on those ESG goals.
Dusty Weis:
Sarah, one topic that's going to come up a lot in this conversation is ESG and ESG reporting. And for those who aren't familiar with the acronym, what is ESG?
Sarah Fox:
So ESG stands for environmental, social and governance. It refers to the collection of a corporate's performance and its evaluation criteria along those areas. So they lump them all together and you get an ESG report, it's social responsible investing or impact investing is another our term that people use. So we, as a company are going to be measuring each of those areas and then putting out our own report and then an independent verifier gives us our credit and our number that they define us under.
Dusty Weis:
And is that report just available to anybody that's looking for it or people that are potentially thinking about investing in Nutrien?
Sarah Fox:
Yes, it is publicly available and it's on the Nutrien website as well.
Dusty Weis:
That's great. And of course, we'll put a link to that in the episode description as well. So if that's something that you're interested in reading, go ahead and pull up your episode description, it'll be there for you.
Tom Daniel:
So, let me ask you this question. What are we thinking about, how are we going to measure this moving forward? And what do you think will be the data requirements for us to actually measure 75 million acres?
Sarah Fox:
Yeah, so part of our team's goal is to make this as easy and as seamless as possible for the field. So we're going to be working on that easy button, trying to develop something digitally so that we can track and measure this pretty quickly and easily. But right now what we're trying to do is really define it, define it as a business, what is truly a sustainable acre. And then from that point, we'll start putting in place the measurement pieces and the tracking pieces. And we can promise you that as a sustainable ag team, we'll do the heavy lift on this and we'll just be asking for a little bit of data points here and there, but we'll be the ones who actually track and measure that.
Dusty Weis:
Sarah, if I could jump in for a minute here, 75 million acres, again, it's one of those numbers that on paper it's a number, but when you try to wrap your head around it, it's really pretty incredible. Now sustainability in agriculture is something that's been around since the dawn of time, but modern sustainability and the data and metrics that measure it, and that's a pretty new science. Do we know how to does 75 million acres stack up to what's been done historically in similar programs before, has anybody else ever attempted this?
Sarah Fox:
I think people say they've tried to attempt it, but I think we're one of the first groups to really look at it from a broad business perspective and then try to measure it. So we know there's a tremendous amount of really good work happening out in the field. So for example, any conservation program that's already occurring, that's considered a sustainable acre. We just, as a team might not have that data in front of us. So Nutrien Ag Solutions and Nutrien as a whole, globally has been doing some amazing things.
Sarah Fox:
What we're trying to do is get at some of those numbers so that we can help tell that story to our shareholders for these ESG reports. At the same time, we're coming up with some new opportunities and new ways that we can look at this and really measure and track it and verify it, which I know you guys have talked about that as well, but those are acres that we'll be tracking and measuring as well. So it's existing practices that are occurring right now. Some activities that have happened for years, we just want to get a handle around that, but then also some new opportunities and we're going to be lumping it all into kind of a big bucket and then sending it up to the corporate group so that they can report on it.
Sally Flis:
Sarah, we talk about carbon a lot on what is supposed to be a sustainable ag podcast and as we've talked about carbon on the podcast in the past, it's really at extra piece. So I think my question would be kind of probably what a lot of our field staff would be thinking or our crop consultants would be thinking, does this mean we're just going to try and put 75 million acres through a carbon program?
Sarah Fox:
No, not at all. And that is sort of this point with... We know there's a lot of really good work already happening out there around sustainability and sustainable acres. So the existing practices and programs and technologies that are happening, we want that information and we need that information so we can share it. Going into the future, carbon is one piece of this, but we've kind of put together a matrix of a triangle, it's the top part of the triangle. There are measurement acres that will count in this, there are sustainable solution acres that will count in this. So it is one piece of it, but it's not the whole thing.
Tom Daniel:
So Sarah, I'd ask a follow up question of that. Is this something we can do alone? Is this something that Nutrien Ag Solutions by ourself can accomplish 75 million acres?
Sarah Fox:
I don't believe we can. And that's part of my role and my background. It's a very big goal. It is a global goal and we're trying to move the industry with us. And so we're going to have to do this in partners with everybody who has a relationship with agriculture and the land.
Sally Flis:
Sarah you've been in sustainability across a couple different jobs that you've had in your career. How does this 75 million acre goal compare to other sustainability projects that you've worked on through your career, better, worse level of excitement about it versus other projects you've been on?
Sarah Fox:
I would say I'm excited about it because we're actually putting some numbers in front of the work we're doing. So there is a world out there that doesn't necessarily understand agriculture that well, but they understand sustainability and they understand sustainability metrics. So by putting a number in front of this and being able to tell that story and show those numbers, we're representing agriculture in this bigger sustainability space, which I find exciting. I also am really excited that sustainability is now part of the retail business. We've been in the retail team now for two years or about three years, I guess, and being part of business means we're motivated by the business. So we're not just going to try to meet these goals based on a corporate initiative. We're trying to meet these goals for the business as well, which you have to be profitable doing the work that you're doing.
Sally Flis:
So Sarah, when you mentioned your career, you've been doing sustainability for a while now, kind of what's been your pathway to get into what you work on now as the director of strategic partnerships with Nutrien Ag Solutions?
Sarah Fox:
So I have been doing some form of sustainability or climate work my whole career. I actually always like to tell the story of my dad. I grew up with a dad who was studying high Alpine areas and he saw the impacts in the high rocky mountains of climate change when I was a kid and I witnessed that and watched it, I then went on and studied it in college and in college we were talking about comparative risk. And so when I graduated, I worked a lot on comparative risk. Comparative risk was a program where you looked at the environmental, the social and the economic impact, you put it all together and try to find the sweet spot in the middle. That's the same thing as sustainability. And then the term became sustainability and being sustainable. And so my background was mostly with environmental groups. I was always really excited about sustainability because it brought in that economic and social piece, being the environmental person, I saw the need for the environmental change, but if it wasn't going to be profitable, then I knew it wasn't going to happen.
Sarah Fox:
So I spent a lot of time working more from that environmentals perspective, got excited about sustainability and bringing that to businesses because we looked at things from that bigger picture. And then coming into agriculture, it's been the same thing where it's been exciting to sort of see that movement of recognizing the current work that has already happened, but then putting some numbers to that from an impact and a economic perspective, and then making sure that you tie in some of the social and health and wellness pieces as well.
Sarah Fox:
So it's kind of that sweet spot in the middle opportunity that we all have. What's interesting to me is someone said the other day, it's actually one of my kids who said, you used to always say, mom, you could never solve for sustainability, that if you solve sustainability, then everybody's out of a job. And I think that's still true, it's definitely true in sustainable agriculture. If we achieve this and get to 75 million acres before 2030, then we'll be out of a job, hopefully we'll have to maintain those acres. But I think the ultimate goal is this circle, it's truly sustaining itself and just keeps going.
Tom Daniel:
Sarah, you mentioned something in that statement, you were talking about conservation groups, and I hear the term all the time when I became part of the sustainability team over a year, almost two years ago now, the discussion was around NGOs and I never understood what an NGO was. And then when you told me what an NGO was, being an old farm boy, I didn't see much use for an NGO. But now that I've been in this now for almost two years, I definitely understand the reason and the function of an NGO in our overall sustainable marketplace today. So give me an idea, when you're working with partnerships and NGOs, give me a definition of those groups and tell me how important they are into the work that we do today.
Sarah Fox:
Yeah. So an NGO stands for non-government organization, nonprofits. We do work with industry nonprofits, so the bigger entity type groups, but mostly what I spend my time with are environmental nonprofits. And I know when I first started, there were a few people who said, we're talking to who? You're talking to Environmental Defense Fund and you're talking to The Nature Conservancy. And I'll tell you the reason I do that is because I came from that world, I had a perception of agriculture and I didn't understand it. So by opening the door and having a conversation, the goals are similar, around land protection, conservation, air, water, the goal is similar, but how you get there and your impact on that story is important to share and to understand from both sides. So we do spend time with some of the environmental groups, kind of opening our doors, but I would say understanding the language, sharing the language of agriculture and how we look at similar topics and are working towards similar goals, but how we're trying to get there and then match those with these environmental groups as much as we can.
Sarah Fox:
We're never going to see a hundred percent eye to eye, but I think understanding each other is important. There's also credibility that comes with that. So your average citizen in some areas... I know I have rose colored glasses or green colored glasses on sometimes, but they're asking these questions, everybody's interested in agriculture and food right now. They want to know where their food comes from, they're asking a lot of questions. And so we have an opportunity to use these environmental groups to help us communicate that message. We're not influencing them, we're not telling them what to say. We're just opening the farm gate a little bit and sharing the story and when they learn the story, they're actually excited to work with us and try to get there with us. So I think it's an important avenue for us to gain that credibility for the work we're doing.
Sally Flis:
Sarah, you mentioned as we were talking about your journey through sustainability, that if we achieve our goals, we might all be out of a job. And while I do miss milking cows and taking soil samples, some days I think it'd be a lot easier to just do that with my time, as you've journeyed through that career, how much change have you seen in what sustainability means, how sustainability is measured and that shifting landscape that we often work with in sustainability so that we have our goals, but we're in that continuous adaptive planning phase, I feel like in a role around sustainability?
Sarah Fox:
I think we've gotten smarter. The more we learn, the smarter we get, the more questions we have. So all of the work that's happening around climate right now and scope one and two and three, and the goals that are being set in those areas, as well as the goals being set in science based targets, that was in the tech industry for a long time and I really didn't expect it to get to agriculture that quickly, but it is. And so that's an evolution more from... I'm really kind of excited because it's got a data component to it. I keep saying that, but we're actually going to be able to measure and track this stuff rather than just talk about it. And in the past in agriculture, when I first started, we were just talking about it and we were saying, well, we're doing really good work and we're trying to reduce this and we're trying to improve air quality and we're working on nutrient management, but we didn't have collective ways to measure and track it and so it was very hard to tell that story.
Sarah Fox:
The investment community, I think, has also been a huge push in this. The fact that we do ESG reporting, the fact that somebody is investing in a company based on their ESG report, like my neighbor told me the other day that he's investing in Nutrien because of our ESG report, and I just looked at him and said really? And he said, Yeah, I'm, I'm looking at everyone's ESG reports. Who knew? And I would not say this as a typical gentleman who would do something like that. So I just think people are becoming more aware, they're asking more questions. And us as a company and especially as a big ag retailer, to be able to share those data points and tell that story, we're really going to knock it out of the park when it comes to some of these reporting requirements.
Tom Daniel:
Sarah, you made the comment that you're excited that we're not just using narrative statements around sustainability, but we actually have data. I've been around the industry a long time now and we've always said, Why, we're doing good. That's the statement I've heard, farmers are doing good and we are, but we have the ability to prove it now. So we can prove we're doing good, right? And I think that's what's going to create the realization by the consumer industry that agriculture's doing good things and we're constantly looking at new things. And so I just think the ESG reporting, all of that's driving us in that direction, which is fine, but I think we're truly telling the story of what we're doing good. And I think that's going to be a key component for us.
Sarah Fox:
I agree.
Sally Flis:
Sarah, your full title with Nutrien Ag solutions is Director of Sustainable Ag Strategic Partnerships. So what does it mean to be a strategic partner with Nutrien Ag Solutions and how do we go about building those with different parts of agriculture and non-agriculture really, as you mentioned, the NGO groups earlier?
Sarah Fox:
Yeah. So as we mentioned, in order for us to achieve the 75 million acre goal, we need partners. We know we can't do that alone and partners bring different perspectives, different products, different solutions to that result or that need. And so to work with us as a partner, we look for groups who have similar goals to ours. If you have a goal that you're trying to achieve, that aligns with us, we'd love to partner with you. We look for companies who are trustworthy and ethical, obviously, that we feel we can work closely with and can help us down a path. We also look for partners who might challenge us a little bit in areas that are something that we might not have the expertise in, but could help us ask some questions that we might not have considered, but get us a little bit it further down this path as well.
Dusty Weis:
Well, Sarah, there's certainly a lot of really great opportunities here and we're glad that we've covered them. And of course, if our listeners want to learn more about this, Sally, or share or request more information about field level sustainable ag initiatives, where do they go?
Sally Flis:
So one of the things like Sarah mentioned in our discussion today is finding out about those local sustainability partnerships that you may be working with growers on, or that growers may have asked about, or that you may have heard about and be interesting in growers signed up for. And those questions can go to our sustainable ag email, sustainableag@nutrien.com. Or if you're just looking for more information, you can reach out through that email address as well and that'll get directed to the right member of our team to get you some answers and get this data collection and practices rolling on the ground.
Dusty Weis:
Well, once again, we've set the table with a lot of good information and folks certainly have a lot to work their way through here. So hopefully if anybody has any questions, start reaching out to sustainableag@nutrien.com. But this has been a great discussion. Sarah Fox, the director of sustainable ag strategic partnerships at Nutrien Ag Solutions, thank you so much for joining us on this episode of The Future, Faster.
That is going to conclude this edition of The Future, Faster, the pursuit of sustainable success with Nutrien Ag Solutions, new episodes arrive every other week, so make sure you subscribe in your favorite app and join us again soon. Visit futurefaster.com to learn more. The Future, Faster podcast is brought to you by Nutrien Ag Solutions with Executive Producer Connor Erwin and editing by Larry Kilgore III. And it's produced by Podcamp Media, branded podcast production for businesses, podcampmedia.com. For Nutrien Ag Solutions, thanks for listening. I'm Dusty Weis.
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"The Future. Faster": Episode 10
Posted December 1, 2021
