What does sustainability and Regenerative Agriculture mean for your farm’s ROI?

March 12, 2025 | Kriss Nelson

Are there opportunities and demand for sustainability and regenerative agriculture as an additional cash stream for a farmer?

Last week's Commodity Classic, held in Denver, included a panel discussion addressing those questions and navigating changes in priorities resulting from the new administration.

Tyne Morgan, Host and executive producer, US Farm Report moderated the panel with questions from the audience consisting of Oriana Lisker Bosin, product manager, Sustainability Solutions with John Deere; Kenny Fahey, president and CEO with Leading Harvest; Kelly Garrett, Crawford County farmer, owner and co-founder of Xtreme Ag; Sally Flis, director of sustainability program design and outcome management for Nutrien Ag Solutions and Peter Meyer, principal/crops economist with Muddy Boots Ag, LLC.

Question:

What is the biggest myth regarding sustainability and regenerative farming, and what does it mean for farmers in their ROI?

Bosin: In conversations I am in, one of the biggest myths is if farmers only did “X,” they would be sustainable. The message I try to combat with is that farmers are already sustainable. If they weren’t they wouldn’t have an operation. Having quality land and improving the quality of the land is crucial to the business of farming.

Fahey: The biggest myth should be that we focus too much on prescriptive practices. I think the case should be outcomes-based focus, allowing farmers and growers to decide for their operation what the optimal set of activities and practices is to achieve the outcomes we care about.

Garrett: On the farmer side, the biggest myth is they have to make practice changes to be considered more sustainable, and regenerative agriculture will come with an ROI hit. I disagree that happens. I believe you will make more money, not less. What is sustainable to me and to someone else are two different things. The environmental community needs to understand sustainability is different in other parts of the country.

Flis: A myth is regenerative ag or sustainability is finding the next best practice. It’s just good agronomy, which we have been doing for 20 years. When I started, it was cover crops, no-till, crop rotation and nutrient management. Those are still the top practices we want to work with growers on and find the right fit for that acre for what that grower wants. We don’t need another name or definition of what it is. It’s just doing good agronomy.

Meyer: A myth is consumers don’t care about sustainability or regenerative farming. That is one of the biggest fallacies out there. It will probably cost consumers more money, whether it is sustainable aviation fuel or any of the sustainable products.

Question:

Sally Flis mentioned she didn’t call it sustainable regenerative farming; at the end of the day, it is just good agronomy. It goes back to what farmers have done. What is the definition of regenerative agriculture and sustainability?

Garrett: The priority is to balance soils. From a base saturation perspective, the second priority is to balance the plant. There is a lot of talk from the environmental side about the overuse of nitrogen. And that is true. We need a balanced plant and micronutrients to convert the nitrogen to protein and amino acids. You have to have a balanced approach.

Question:

Does the definition of regenerative agriculture and sustainability matter?

Fahey: When it comes to the correct term, I don’t care about that at all. It is purely a marketing question, but it potentially has some value in how we communicate to consumers and stakeholders. What matters is getting to some standard definition of the outcomes we care about. Outcomes related to water quality, soil health, biodiversity and nature. What is important is that it has to come down to farmer profitability. You also need to demonstrate proactive management. Can you deliver the right set of outcomes repeatedly and bring third-party verification and credibility?

Question:

Does regenerative agriculture and sustainability affect more than just the environment?

Bosin: I boil it down to sustainability, which is about doing more with less. When it comes to passing the farm along to the next generation, it is common for farmers to talk about sustainability. There are a few elements to that. One is profitability on the farm. They want to pass down a viable financial business. Another element is quality of life; the final is ultimately maintaining and improving soil quality over time. That is what you will be passing down, and a way to do all of those things is doing more with less while enhancing productivity and profitability and ultimately improving soil health over time.

Question:

It all comes down to data. Does the type of data matter?

Flis: At the end of the day, record something. Our teams of agronomists and consultants can help you figure out how to record data, but if you record nothing, we can’t make decisions and figure out what the next best practice is. We can’t calculate the outcomes the downstream wants to see. Soil sampling and tissue sampling are fundamental in making the decisions about improving nutrient use efficiency. Get it written down. Measure what you are doing, then you can measure it to make the right decisions.

Question:

What has helped make capturing all of this data on your farm easier?

Garrett: Technology makes it much easier. It doesn’t matter what kind of technology you use as long as you have data. There are several different platforms out there. We use the John Deere Operations Center. It makes it very easy. With the John Deere Operations Center, we helped a customer put 11,000 acres into a sustainability program with just seven keystrokes. Data matters, but think about an organization that is needed to keep 11,000 acres in a notebook versus seven keystrokes on your computer.

Meyer: I think a lot of this has to do with what you have heard from other panelists about data; the biggest thing we find is keeping the cleanest data you can. We have seen U.S. consumer packaging goods companies buying credits through various companies backed off. That said, when you look at the world, that market has not slowed down. The biggest difference is that the U.S. has a voluntary carbon market, compared to the EU or Asia, where there is a required carbon market. In 2023, the EU traded $1 trillion worth of carbon. Nobody can tell me there is no money in carbon. Nobody can tell me there is no demand for carbon. To give you an idea, if you are a business in the EU and omit 1 ton of carbon, you have to buy a ton of carbon somewhere in the market, and there is a carbon tax as well. With the limited amount of farmland in the EU as compared to the U.S., those buyers are looking for other places because, at the end of the day, a carbon credit is a carbon credit no matter where in the world it is created.

Fahey: I think when you look beyond just the carbon markets, I would say there is still demand in the US, despite the change in administration; I think a lot is driven from the private sector, grocery retailers -  those companies understand they have long term risks they need to navigate and whether or not those are risks related to climate or consumer preference or coming up against the biophysical limits of nature, companies are going to continue to engage on these topics and continue to look to their supply change to ensure they will be able to navigate those risk effectively. The carbon market indeed has a bigger demand either outside of the U.S. in the near term or, more holistically, supply chain demand for proactive management of sustainability outcomes – that hasn’t gone anywhere, and I think it will only continue to strengthen.

Meyer: The biggest problem in attacking the global market is the standard. We have multiple standards all over the place. For us to compete globally, we are going to need one standard and a regulated market.

Question:

I know it’s not a one-size-fits-all, but what is one practice providing the biggest ROI?

Garrett: That is like asking the high-yield guy what the silver bullet is to make 400 bushels an acre of corn. It’s a systems approach. In the hills, I find value in no-till; in my hills, I find value in cover crops; I find value in other sustainable products I use. I talk about nutrient density and nutrient use efficiency. That is balanced agronomy. It is a systems approach; you need to embrace it all and slightly tweak it for your area and where you are farming.

Question:

How do you play the carbon intensity scoring game? I already have cover crops. Should I stop, go backward, and go back to plowing?

Garrett: No. I don’t believe you should stop. With the programs that are coming and the way things are evolving, I don’t think you need to start over.

Meyer: The land change caveat, we don’t think, will last much longer. When we talk to people in the global markets, they don’t care about land change.

Question:

Regulatory oversight is likely coming to the U.S. How should farmers prepare for that?

Meyer: First, you have to create one standard before starting regulations on them. Putting the cart before the horse, my partners and I spoke with several senate staff, house representatives staff, and Commodity Futures Trading Commission members who were there, and we talked about regulating the carbon market. Everybody is afraid of regulation, but at the end of the day, if it adds transparency, it helps farmers understand what their carbon is worth, and the buyers understand what the carbon is worth.

Kenny: It has to happen. When we are talking about standards, there are two different categories we are talking about. A specific standardization around carbon markets is very much needed; if you look at the sustainability outcomes that matter to farms and downstream companies, that is what we are trying to standardize. We know standardization is the power forward; that is how you get to scale and efficiency. The market will demand regulation, and standardization is the only logical outcome to meet the needs of that regulation.

Flis: No standardization matters if you are not collecting the data. You will not be able to participate even if it is just one standard we can all follow. If you don’t have the data and evidence, then it doesn’t matter. You need clean data. Data we can use and demonstrate to any one of these verifiers downstream. Talking about conservation and efficiency and getting away from using sustainability and regenerative agriculture is in a lot of our language now.

Meyer: All we are trying to do on the carbon side is not to add more cost to your operation but to monetize that data. That data is worth money. I am just talking about the verification of certain practices you are already employing. The data backing that up is worth money.

Garrett: You are selling your data. You know what a bushel of corn looks like. But you don’t know what a carbon credit looks like. Everyone will be telling you to protect your data. If you sell a carbon credit, you still own the data, but you are selling that data. Selling that information that proves what you did is why data is so important. Nutrient use efficiency, turning down your costs and monetizing your data.

Question:

It has been perceived that growers will see a negative ROI, not a positive one, when implementing these practices.

Flis: Our sustainable, economical program asks growers to reduce the nitrogen rate in order to participate and get paid for carbon. We recognize we have the products and tools to help growers optimize every pound of nitrogen input on the acre so they get the best return they can get on the program. We are out there trying to make the best decision on that acre for the grower to be productive and profitable every year. It doesn’t do us any good for growers not to be profitable.

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