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Introduction toNature Markets Assessing land​opportunities Working with​other farmers​ Baselining,​planning and​measuring Working​with buyers Farm business​planning Liability & risk​management Using repayable​finance​ Signing legal​contracts Public sector​funding & policy Tenancy &​ownership​
  4. Groundwork
  10. Market Engagement
Introduction toNature Markets Assessing land​opportunities Working with​other farmers​ Baselining,​planning and​measuring Working​with buyers Farm business​planning Liability & risk​management Using repayable​finance​ Signing legal​contracts Public sector​funding & policy Tenancy &​ownership​
  4. Groundwork
  10. Market Engagement

Summary of Neston Park Estate

Neston Park Estate is a 2,000-acre estate in Corsham with 800 ha of farmland. The Estate has been farmed organically for 25 years and is currently exploring the possibility of selling carbon credits. The Estate’s Farm Manager, Paul Redmore is working with the Trinity AgTech Sandy tool to develop a carbon audit of the farm, which has shown that the Estate is currently carbon negative, sequestering an additional 500 – 1000 carbon units every year, beyond what can compensate for the Estate’s own emissions.

The Estate owners are not interested in changing their farm management practices to maximise carbon sequestration potential or develop BNG units but rather want to balance agricultural production, maintaining the Estate’s historical character and conserving nature.

 

Farm Profile:

  • Location: Corsham
  • Size of Land: 800 ha farmland on 2000 ha estate
  • Tenancy & Ownership: Family-owned estate with 6 tenants
  • Nature Market Focus: Carbon (soil & woodland)
  • Interventions: Organic farming, woodland management, reduced inputs
  • Project Partners: Trinity AgTech

 

What do I need to know about nature markets to begin with?

 

This section of the Toolkit provides a brief overview of nature markets in England and how they relate to farmers. It is designed to answer some of the early questions that farmers may have around nature markets. All Toolkit content, including this Introductory section, will be updated regularly.

 

What market opportunities are available to me based on my land and goals?

 

This milestone will guide you through an initial assessment of your land as you determine what your broad vision is in relation to nature and help you to identify what opportunities might be available to you to attract private sector finance.

The actions taken at this stage can be taken before you’ve made the firm decision to engage in nature markets. The considerations presented in this milestone will help you determine whether nature market participation makes sense for your goals, the condition of your natural capital and your farming business.

You can also apply many of these considerations to develop a broader vision around your natural capital and other potential funding sources – such as government grant schemes or philanthropic funding.

 

Will I need to partner with other farmers, and if so, how?

 

Once you have a vision for your farm, the environmental enhancements or changes you want to make and a sense of the related income opportunities, you may want to consider joining up with other farmers in your area to implement your outcomes at scale to attract buyers.

Aggregation models, often started among farmer clusters or as farmer cooperatives, bring together multiple farmers or landowners to collectively participate in nature markets. These models aim to harness the combined efforts and resources of farmers to maximise environmental benefits and economic opportunities. This section will introduce the factors that may influence your decision to join up with other farmers and some of the key considerations to keep in mind when setting up and participating in such a group.

 

How do I measure the environmental outcomes that I can produce in a robust way?

 

At this stage you will have developed an overarching vision for your land and a rough plan for what you want to improve. You will now want to make robust baseline measurements of the condition of your land and develop a detailed plan for interventions and intended outcomes. Plans will also include how you intend to maintain your interventions, measure the impact you are having and verify your outcomes in order to sell them.

 

How should I identify and approach buyers for my outcomes?

 

During your initial project scoping, you may have identified potential buyers of the environmental outcomes you are planning to deliver. Now that you have a project plan and a robust baseline, you will be ready to approach and engage buyers more formally.

Buyers will vary in their expectations and requirements. This milestone will help you prepare for initial conversations with potential buyers to ensure you are empowered to ask the right questions and present a project that will attract a fair price. Your buyers may be within your own supply chain such as retailers and businesses, or organisations who benefit directly from your ecosystem services such as water companies or firms who seek to offset their own environmental impacts.

 

How would this project fit in with my current farming business model?

 

Nature market projects are often just one part of a farmer’s wider business. Some people compare building nature market projects to developing ‘micro businesses’ for the farm. As such, much of the content you see here will be familiar to you.

However, these projects also have key features that separate them from the businesses that farmers usually engage in. For example, the longer timeframes associated and the current uncertainties relating to how nature market projects (and the deals that result) can be blended with government schemes.

Below is a list of questions that will help you think through how to incorporate these projects into your current farm business plan. This includes considerations on building a cashflow or partial budget, but also the less quantifiable factors, such as the potential drawbacks and opportunities to your wider farm that nature markets present.

 

What kind of risks should I be aware of and how can I manage them?

 

Like with any aspect of a farm business, risk management is critical – especially for nature market projects that can run over several years. As the landholder, you may be leading the development of the project, be part of a wider group of farmers, or be working with a third-party project developer that is taking the majority of the risk.

In any case, it’s advisable to have a clear understanding of the likelihood of the risks involved, what will happen if the risk materialises, what you as the landholder might be liable for, and how the risk is being managed to prevent this liability.

This Milestone sets out the different types of risks that nature market projects (and the deals that result from them) often carry. The last section covers the types of legal entities that farmers might form, as these can help to manage certain risks and benefit the overall operations of the project.

 

Is it possible to use repayable finance upfront to meet any of the costs?

 

Repayable finance from investors – typically debt or equity – is not always necessary in nature markets if upfront costs can be met by the buyer or through grants.

It’s also important to note that, even when repayable finance is needed, farmers do not necessarily have to secure this themselves.

In the UK, there are very few examples of individual farmers taking out loans and no examples of farmers issuing shares to use specifically to finance a nature market project. Typically, the upfront capital required is organised by a third party – for example, a third-party project developer, a broker etc.

However, as nature markets develop further, and in the case of larger farms, there is potential for farmers to secure repayable finance and meet up-front costs, as with other parts of their business.

The below therefore sets out some questions that farmers (and, more likely, third party project developers) could ask themselves to secure repayable finance from lenders and investors, whether that’s taking on finance independently, or as part of a larger group or partnership.

 

What do I need to be aware of when signing contracts?

 

This Milestone is about the legal contracts you will use and sign to officially commit to the project and transition it to a fully fledged deal. As business owners, farmers are familiar with contracts and understand the need to carefully review the details before signing any such agreements.

Any nature market deal is likely to involve legal agreements that will be tailored to each set of circumstances. However, for ease this Milestone sets out what contract set-ups are used in this space, common contract types, and other key considerations to ask yourself at this stage.

Disclaimer: The information in this Milestone does not constitute any form of legal advice but instead serves as practical advice that has been written by speaking with lawyers, farmers and other practitioners. We recommend that appropriate legal advice should be taken from a qualified solicitor before taking or refraining from any action relating to your contracts and projects.

 

Can I participate on tenanted land?

 

The tenancy and ownership structure of land can have significant implications for farmers engaging in nature markets in the UK. The rights of tenants in relation to nature markets is still not entirely clear in the UK and may differ on a case by case basis. Below are some key considerations which can help both tenants and landlords in asking the right questions when considering engaging in nature markets as policy and legal frameworks develop. Further guidance prepared by the Tenant Farmers Association and the Country, Land and Business Association can be found here. 

 

How do public sector funding and policy align with nature markets?

 

In England, the role of public funding and support to farmers is undergoing change on a scale not seen in decades. The government hopes to strengthen the link between environmental and farming practices to meet its climate and nature restoration targets, while maintaining food security and the viability of farm businesses across the country.

This section offers a summary of how government is working with farmers to access nature markets, and provides guidance on:

 

  • How nature markets might work with public subsidy schemes,
  • What development funding is available for farmers to explore their opportunities,
  • What ‘market infrastructure’ the government is supporting – including Standards and Codes.

Groundwork

 

We have separated out these Milestones into ‘Groundwork’ and ‘Market Engagement’ to indicate which Milestones you will want to read as you consider and/or prepare for nature markets (Groundwork) and those you will move through if and when you decide to become a seller of environmental outcomes (Market Engagement).  

We recommend all farmers read through the Groundwork Milestones in addition to the Introduction to Nature Markets in order to understand better whether nature markets are for them, and how they can, at the very least, explore and baseline their farms so they are ready for any opportunities that may arise later.  

Market Engagement

 

We have separated out these Milestones into ‘Groundwork’ and ‘Market Engagement’ to indicate which Milestones you will want to read as you consider and/or prepare for nature markets (Groundwork) and those you will move through if and when you decide to become a seller of environmental outcomes (Market Engagement).  

We recommend all farmers read through the Groundwork Milestones in addition to the Introduction to Nature Markets in order to understand better whether nature markets are for them, and how they can, at the very least, explore and baseline their farms so they are ready for any opportunities that may arise later.  

 
Acknowledgements 

With thanks for his time and insight for this case study:

 

Paul Redmore Farm Manager, Neston Park Estate

 

Published 09/04/2024

Next Milestone

Key Takeaways

  • Neston Park Estate’s organic farming practices has yielded substantial carbon credits without the Estate needing to further change its management practices
  • Neston Park Estate conducted a carbon audit using Trinity AgTech’s Sandy tool which is ISO-accredited.
  • The Sandy tool has users input data that many farmers are likely to possess already such as cropping and livestock data, records on inputs and soil analysis which farmers may have already done as part of SFI
  • The Estate is not further changing its management practices to increase soil carbon

 

 

What prompted Neston Park Estate to start measuring its carbon footprint?

Neston Park Estate in Corsham has been organically farmed for 25 years. The Estate produces wheat, oats and barley, which is primarily used as feed for its dairy, beef and sheep herds. Much of the farm’s dairy products are sold into niche markets, where they fetch a higher price than standard milks, butters and cheeses. Recognising an opportunity to further distinguish their products and potentially enhance profitability, the Estate’s Farm Manager, Paul Redmore began to consider integrating the farm’s carbon footprint into the narrative of their farm products.

Redmore had been looking into carbon markets since 2022 and decided that a reasonable first step would be to get a carbon footprint of the farm. While unsure about the Estate’s immediate engagement in carbon markets, Redmore aimed to position the Estate favourably for potential future involvement as these markets matured. He felt confident that the Estate had a low carbon footprint but wanted to get that confirmed through an audit.

 

How did Neston Park Estate measure its carbon?

Neston Park Estate used Trinity AgTech’s Sandy tool to measure their carbon. The tool has users’ input data on cropping, livestock numbers, tonnage of product, soil analysis and inputs to develop a carbon audit of the whole farm business. Neston Park had existing data which could be inputted into the tool, including soil analyses conducted under SFI, so had to do only limited additional data gathering. Redmore notes that most farmers likely have much of the data they need already, due to statutory requirements to keep records on livestock and medicines and standard business records of what the farm produces and sells.

After evaluating multiple carbon auditing tools, the estate opted for Trinity AgTech due to its International Standards Organisation (ISO) accreditation and third-party verification of each carbon audit. These factors were important to Redmore as he anticipated selling carbon internationally and wanted to provide potential buyers assurance that the carbon was measured accurately.

The cost of the software is £1,500 annually which includes assistance from Trinity Agtech on data entry. It took the Estate 200 – 300 hours to conduct the initial baseline, which required inputting data from four years of farm operations. Now that the baseline is completed, Paul estimates it will take 30 – 40 hours annually to update the tool. The audit revealed that the Estate was carbon negative, with a surplus of 500 – 1000 tonnes of carbon every year. The Estate is now waiting for their audit to be verified and will then decide whether to retain or sell their carbon credits.

 

 

What is Neston Park Estate’s plan for increasing carbons sequestration?

Neston Park Estate does not intend to make significant changes to its management practices to further boost soil carbon. As a family-owned historic estate, the owners prioritise retaining the Estate’s historical character, which precludes substantial alterations to management practices or habitats. Instead, the Estate views carbon markets as a complementary aspect of its existing business and, given that current agricultural practices already yield carbon units, is content to maintain  current practices.

 

 

How does biodiversity fit into the Estate’s management plan?

Although biodiversity and conservation are important to the Estate owners, they are not currently considering engaging in the Biodiversity Net Gain market. With longstanding conservation efforts across various land parcels and involvement in two Countryside Stewardship schemes aimed at habitat improvement, the Estate already maintains a high biodiversity baseline. This makes generating substantial gains in habitat challenging.

Although biodiversity markets are not part of the Estate’s current strategy, Trinity AgTech’s Sandy tool does measure biodiversity, providing scores at both field and farm levels. Integrating biodiversity scores into marketing materials for the Estate’s carbon could potentially enhance the value of carbon credits. This is discussed further in the Green Farm Collective case study for Milestone 2.

In conclusion, conducting a carbon baseline was a natural next step for Neston Park Estate, which had been focused on organic and low-input agriculture for some time. The Estate’s experience indicates that participation in carbon markets does not necessarily require a fundamental change in management practices, depending on a farmer’s goals. Conducting a baseline using an accredited tool can open up opportunities for both selling carbon and enhancing the value of a farm’s agricultural products.

 

Lessons Learned

“Don’t be afraid to jump in – some data is better than none and farmers are likely to have much of the data they need already. The more detail you can input, the more accurate the audit will be so get started now, with the data you have and then accuracy can be built over time.”

 

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