When Carly and Grant Burnham of Bonnie Doone station in Monto, Queensland were issued 94,666 carbon credits worth $2.8 million, they became famous almost overnight.
The pair were among the first producers to generate carbon credits via soil carbon capture in September, and the phone hasn’t stopped ringing since. Investors from as far away as Paris have offered them money to buy new properties, or at the very least purchase their carbon credits.
But the Burnhams believe they have a duty to act in the best interests of the beef industry and the farming community, so they are taking their time.
“We're really committed to the Australian agricultural industry and the Australian supply chain, so it's time for us to be very clever with how we sell or inset, offset or develop,” Carly said.
Grant agreed, saying for the couple it was about growing more than their Australian Carbon Credit Unit (ACCU) account.
“The ACCU thing is great but it's so much bigger than just us,” he said. “This is an exciting thing for agriculture to be part of the solution. I'd like to see the wealth that's created getting back to the grassroots level, see more families doing more on small parcels of land and communities growing.”
Years turned into dog years
Lachie Dunsdon of Acumentis, Terry McCosker of CarbonLink, Carly and Grant Burnham of Bonnie Doone Beef, with moderator Jackson Hewett
The Burnhams know how to wait. Speaking at AuctionsPlus’ and Clayton Utz’s Natural Capital: Pitfalls and Possibilities event in Brisbane, the couple said they didn’t realise how long the process would take.
The ACCU project evolved from work they were already doing with Terry McCosker’s Resource Consulting Services (RCS), when he suggested they be among the first triallists for Mr McCosker’s associate business CarbonLink.
Mr McCosker was also surprised by how challenging it would be.
“It is the most difficult, twisted, up and down journey that I've ever been on and the hardest thing I've ever done,” he said.
We actually call it dog years, because in the carbon space, it takes you seven years to make one year's worth of progress.”
The wait has one dividend however. Originally budgeted at $11 a tonne when the project launched in 2016, the ACCUs are now worth $31 today.
For Mr McCosker, the ACCUs are something of a cherry on top of the work that has taken place. He believes that the increase in soil carbon goes hand in hand with the Natural Capital component of a property’s value.
“Pretty well all the people we've worked with are increasing their vegetation as well. Not for a financial reward, but because of what it does for the environment, for the feed supply that animals get and for carrying capacity.”
Our dams are useless
For the Burnhams, the project was always about improving the 8000-hectare property that had been in the family for five generations.
They increased the number of paddocks from 30 to more than 100, put in extensive water infrastructure and mapped plant and soil types to identify best practice for rest and regeneration.
The process cost $1 million over five years, but the payoff in terms of output has been immense, with carrying capacity increased by 1000 head.
“If you try to buy a place to run an extra 1000 head, it’s pretty easy to spend $10 million,” Grant said.
A key element has been improved water retention. According to Mr McCosker, for every tonne of organic carbon added to the soil, four to 10 tonnes of water holding capacity is added. For the Burnhams, that means an extra 380,000 tonnes of water holding capacity over the five years.
“Our dams are useless these days, so we’re definitely storing more water in our landscape. We can grow at least twice the amount of feed than before and in some areas far greater than that,” Grant explained.
That is before the value of the carbon credits. Carly estimated that at a price of $40 a tonne, the return on investment on the ACCUs would be 300%. However, the Burnhams currently have no plans to sell their ACCUs and are excited by the possibilities of selling “carbon-negative” beef.
The natural capital equation
Lachie Dundson, valuer with Acumentis said that increasingly he is seeing demand for properties that can demonstrate their potential for improved natural capital.
“A lot of the interest I am seeing is for properties that can demonstrate that enhancement,” he said. “The carbon credit is the cream on top, but I think that to fundamentally improve an ag asset is de-risking the whole thing to retain a good, strong, well-developed asset.”
READ MORE: Why Australia ag is in global funds' sights
