Factors influencing farmers' and landholders' participation in environmental markets

Environmental markets are innovative policy approaches to leverage funding for environmental conservation on private lands. They have transformative potential to ensure farmers both produce and benefit from food they produce and environmental services available to them.

Farmers have a unique role to play in the agricultural system because of their unique relationship with the land and environment in which they work. Thus, they become the key mechanism of change in both the agricultural industry and in the creation of environmental markets.

Current agricultural production practices produce intensive greenhouse gas emissions, which leads to water depletion, pollution, land degradation and biodiversity loss. Australia, along with most of the world, is currently on a trajectory that does not support sustainable food and land use systems. This is why a transition in the sector is necessary.

A factor of this challenge is due to the uneven distribution of benefits and costs of agriculture in Australia. Thus, making it harder for farmers to change to pro-environmental practices. They face unsustainable burdens on their wellbeing, hip pockets and landscape while missing out on the co-benefits of natural resource management on their farm.

NSW Local Land Services, Ethical Fields and JBass Learning partnered with us to inspire and support a network of land managers and farmers to play a leading role in natural capital and environmental markets.

What did we do?

Through a primary literature review, we investigated barriers and facilitators to farmers participating in, and co-creating, environmental market transactions

Once we gained knowledge on this matter we conducted targeted interventions to inspire and equip a network of farmers and land managers from New South Wales: the Environmental Markets Leadership Program (EMLP).

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What did we find?

It was found that participating in environmental markets is generally understood in practice to include, (i) increasing environmental goods and services generated on the land and (ii) exchanging financial value attributable to that measurable increase.

Farmers are increasingly weighing up selling ‘credits’ against other uses and applications of well-defined and validated environmental credentials of farm products and performance.

Through the literature review and interviews we found main barriers and facilitators faced by farmers to partake in environmental markets:

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Facilitators: