Conservation Commerce

Conservation Commerce – the exchange of on-farm ecological services for financial rewards or regulatory assurances.

“Conservation Commerce” is one name for a potential system using incremental measurements or indices of resource management farm by farm or field by field. Management indices provide a method to integrate production and natural resource management in a transparent and succinct manner. This whole farm resource management process allows natural resource outcomes to become valued as commodities and potentially formalized into the agricultural economy.

As in all commerce, you get what you pay for. In today’s conservation delivery system we get some practices on the land in some places. We do get resource outcomes, but we have not been able to define them exactly or at various levels of scale. By using management indices on a field, the impact on the soil, water, habitat and air resources can be defined for that one field. This information can then be aggregated to the watershed, basin, and national level. We can learn what the soil conditioning index is on the ‘back 40 and in the Mississippi Basin that drains into the Gulf of Mexico.

What we need to buy are outcomes. And in the agriculture non-point source pollution world, you get conservation outcomes by changing the management of the lands you farm. By using an index-based resource management process, particular management activities on site-specific fields can produce outcomes than can be compared and valued.

The Rapid Whole Farm Assessment using USDA and university-derived indices is an excellent mechanism to provide management guidance to farmers as stated in “Beyond T: Guiding Sustainable Soil Management,” Sept/Oct 2008 Journal of Soil and Water Conservation Vol. 63, No. 5, pp 162A.

It is envisioned by the Minnesota Project and its partners that the Rapid Whole Farm Assessment can be viewed as a precursor to so-called Conservation Commerce – the exchange of on-farm ecological services for financial rewards or regulatory assurances. This project aims to place market values on improvements and outcomes resulting from on-farm resource management efforts. By demonstrating this process as a potential means to pay farmers for on-farm management, it will provide the initial steps to develop Conservation Commerce.

Commoditizing and Valuing Resource Management

This spreadsheet presents one vision of how a formalized whole farm resource management process may function. It contains multiple categories of value to the agriculture producer (Incentives, Resource Trading, Regulatory Assurance and Participatory Benefits). Items in each category are displayed at conservative monetary values. A single methodology is used and is able to be applied to each and every value guaranteeing uniformity of results. Resource management outcomes are commoditized by using the index-based system and the government, market and non-governmental organizations are free to place values upon the commodities. Other values of regulatory assurance and participatory benefits can use the index system for choosing their level of standard.