Ranchers explore opportunities in carbon markets

As cattle producers face growing pressure to balance profitability with sustainability, carbon markets are surfacing as a tool that may help do both.

These markets reward landowners for implementing practices that reduce greenhouse gas emissions or capture carbon from the atmosphere, turning conservation efforts into potential income streams. Carbon markets may offer financial and environmental returns for ranchers already prioritizing soil health, biodiversity and ecosystem resilience.

Rangelands as climate assets

Rangelands are powerful natural allies on the carbon front. They cover nearly half of the continental U.S. and are managed primarily by private landowners. Though each acre may sequester modest amounts of carbon per year (between 0.2-2 tons on average in the U.S.), the cumulative potential is enormous—especially when managed through regenerative practices.

Carbon sequestration on rangelands depends on factors like soil type, precipitation, grazing intensity and management history. Practices that improve plant diversity, boost root mass and minimize soil disturbance can help build soil organic carbon over time.

Stacking practices—like rotational grazing, improved infrastructure and reseeding with perennial grasses—can further enhance outcomes. These improvements also boost productivity, drought resilience and biodiversity, offering co-benefits beyond carbon sequestration.

How carbon markets work

Understanding the structure of carbon markets can be one of the more challenging parts of participation, especially for ranchers new to the space. While the technical details—like soil sampling and carbon modeling—get a lot of attention, the overall system involves several key players who work together to turn a rancher’s land management practices into a verified, sellable carbon credit.

Most ranchers do not enroll in carbon markets on their own. Instead, they typically work with a project developer, often a third-party company or consultant, who is the main link between the rancher and the larger carbon market infrastructure. These developers manage the design and implementation of the carbon project. They’re responsible for creating documentation, coordinating baseline measurements and handling all communication with registries and verification bodies, as well as buyers.

The next layer of the system is the carbon registry, the organization that sets the standards for how carbon is measured and reported. Registries oversee the market’s integrity by approving methodologies, accrediting third-party verifiers and tracking every carbon credit issued. Before any credits can be sold, a third-party verifier must confirm that the project has delivered the promised carbon benefits. Only then does the registry issue the credits, which can be listed and sold in the marketplace. This ensures only high-quality credits are bought and sold to the benefit of ranchers and everyone else in the ecosystem.

Monitoring, reporting and verification

At the heart of any carbon market project is a process known as Monitoring, Reporting and Verification—or MRV. This ensures that carbon sequestration or emission reductions are real, measurable and permanent. Ranchers must establish a baseline, adopt improved practices and document carbon-related outcomes over time.

This level of tracking can feel overwhelming for producers. “MRV is where a lot of ranchers get stuck,” Nicki Nimlos, lead author of a University of Wyoming study focused on ranchers and carbon markets, told WLJ. “You need GPS-logged data, grazing records, digital infrastructure and lab-tested soils. That’s a big ask if you’re already stretched thin.”

One such company is EarthOptics, which uses ground-penetrating radar, electromagnetic sensors and artificial intelligence to assess soil carbon levels without needing constant core sampling. These technologies make it possible to measure and verify carbon data at scale, allowing ranchers to participate without compromising operations or surrendering data control.

To ease that burden, a growing number of ag-tech companies have entered the space with tools that simplify or automate parts of the MRV process.

“Our approach allows ranchers to participate in these markets without disrupting operations or handing over control of their land data,” Ryan Dierking, director of Northern Rangelands at EarthOptics, explained to WLJ. “That autonomy is critical to building trust and long-term participation.”

This multi-step process can sound intimidating, but the burden doesn’t fall entirely on the rancher. Most of the regulatory and financial responsibility is carried by the project developer. Since developers typically retain ownership of the credits generated by a project, they also control how and when those credits are sold. In return, they negotiate contracts with producers to share a portion of the revenue.

Role of carbon companies

A study published in the February issue of Rangelands and led by Nimlos identified more than 170 carbon credit programs across eight categories. But not all are designed for ranching or rangelands, so finding the right fit is essential. As more ranchers express interest, there’s a push to develop rangeland-specific methodologies that reflect their unique conditions.

“There’s a sense that this space wasn’t built with ranchers in mind—but that’s starting to change,” Nimlos said.

Importantly, ranchers are increasingly being invited into conversations about climate policy and market design—not just as participants but as thought leaders and innovators.

“This feels like the first time we’re being brought to the table as leaders in the conversation,” Nimlos said. “We’ve always cared for the land. Now there’s a system that’s starting to recognize that.”

Organizations like Agoro Carbon Alliance are specifically focused on helping ranchers succeed in carbon markets. They offer support in identifying suitable practices, modeling, verifying and reporting the carbon outcomes. These organizations aim to provide the necessary support and guidance to landowners, ensuring they can adopt sustainable practices and bring their carbon benefits to market.

Agoro works directly with ranchers to identify suitable practices such as adaptive grazing, pasture seeding or improved nutrient management, and helps model, verify and report the carbon outcomes. According to Jake Tilden Browning, a regional sales manager for Agoro, the company focuses on building “long-term partnerships with producers” and tailoring contracts to meet ranch-specific needs.

“We’re not trying to change the way you ranch,” Browning told WLJ. “We want to add value to what you’re already doing.”

Agoro’s contracts typically span 10 years, with annual payments based on verified carbon outcomes. Some producers may also qualify for early payments to help offset the costs of reseeding, fencing or water development. While final compensation depends on third-party verification, Agoro aims to make the process clear and manageable.

“We help ranchers understand what’s possible on their land—what practices might work, how payments are structured, and what’s expected in terms of reporting,” Browning added.

Potential payment and questions

One key question many ranchers ask is, how much money are we talking about?

Carbon credits in voluntary markets typically sell between $10 and $40, but could be as high as $80, per metric ton of CO2 equivalent, depending on the methodology, buyer and market conditions. Depending on the location, soil conditions and management intensity, a rancher could reasonably expect to earn $8-10 per acre per year in 2025. This can result in substantial supplemental income on operations with tens of thousands of acres. In principle, this gives producers a new income stream for practices that enhance carbon sequestration or prevent emissions.

“We want producers to be compensated for the carbon they’re already storing and for the additional carbon they can sequester,” said James Clement, senior vice president and general manager of grass and rangeland at EarthOptics. “This isn’t about asking ranchers to do something entirely new—it’s about quantifying and verifying what many of them are already doing well.”

That clarity is vital. Not all carbon companies are created equal, and ranchers are encouraged to ask hard questions: How are credits priced? What happens if management changes? Who owns the data? What’s the exit plan?

Comparing programs isn’t just about dollars per ton. It’s about alignment with operational goals, risk tolerance and long-term land health.

“Ranchers are incredibly savvy,” Nimlos said. “But they need contracts they can understand, terms they can meet and payments that reflect the value they’re creating.”

Advice and optimism for the road ahead

Transparency, simplicity and flexibility will be essential if carbon markets are to gain traction among working producers. As MRV costs decline and more companies tailor programs to grasslands, opportunities for meaningful participation will continue to grow.

Carbon markets are still evolving, and they won’t be right for every operation. Participation requires time, documentation and commitment. However, for producers already invested in land stewardship, they offer a way to turn conservation into compensation—and to shape the future of ranching on their terms.

“There’s real opportunity here,” Nimlos said. “With the right tools and support, these programs can reward ranchers for doing what they’ve always done—caring for the land.” — Charles Wallace, WLJ contributing editor