We realized that it would be really nice if those carbon removals would eventually stay inside the food value chain instead of selling to airlines and banks and etc.

So then we started working with more and more food companies.

And by the way, for example, right now as well, one of our investors is Mondelez.

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Welcome to the Carbon Stations podcast, where we speak to some of the leading figures in the emerging carbon industry.

Our guest today is Robin Salox, CEO and co -founder of agriculture -focused climate tech company eAgronom.

Robin, thank you so much for joining us.

It's great to have you on the show.

Traditionally, before we get into business matters, we like getting...

kind of a feel of our guest's background to see what brought you to the carbon industry.

So with that said, would you mind sharing a little bit about your background and what inspired you to launch eAgronom in the first place?

Yeah, hi, and thanks for having me.

Well, my background is that I'm coming from the farming family.

So my father is a farmer and his father was a farmer and his father and so on.

But I studied computer science.

So back in 2016, when my father needed a tool to manage our family farm, I ended up building something initially just for our own farm.

And then other farmers started using it as well.

One thing led to another and we decided to start the company.

Now, initially, it was mainly a farm management system used to plan your drops, manage your inventory, do the government reporting and so on.

But already the first prototype, there was something called humus balance calculator as well.

So humus is the richest part of the soil and half of this is carbon.

At the time, we had no business idea behind this one, but we just wanted to communicate to farmers and also to the broader society about the importance of soil health.

So then later, when we already had quite a lot of farmers on the platform, so today we have...

3 ,500 farmers managing 2 .5 million hectares.

But around 2020, when we had, we had less farmers at that time, but that was the time when we decided, we were looking for the next step and decided to launch the afternoon carbon program, started working with food companies, started working with banks and so on.

Excellent.

So how does the whole climate thing come into play?

Like where or when did you?

perhaps see that soil carbon is kind of related to climate change and how this can be used as a means of mitigating climate change?

Yeah.

From one side, my father is an organic farmer.

So for him, the main way to improve the farm results is by improving the soil.

So all that farming is, it's manufacturing.

But the difference is, I guess, with regular manufacturing is that the factory is all the environment around the farm.

So the soil, the bugs, the butterflies, the different plants and so on, this is all part of the kind of production unit.

And by improving this environment, by improving the soil, especially if you are an organic farmer, you cannot use fertilizers, mineral fertilizers and so on.

You have to think how to improve this environment.

And one of the key things is by increasing the humus balance and storing more carbon in the soil.

So we started from the soil side and from the beginning that has been part of our DNA and that has been the most important part.

But then around, and we were really vocal about soil carbon and et cetera.

Then around 2020, some big corporations started approaching us.

saying that, hey, you guys are doing really cool stuff with soil and soil carbon.

And we are also trying to reduce our emissions.

It is impossible for us to reduce to zero emissions, but we would like to compensate or offset the remaining ones.

And since you guys are working with soil carbon already, maybe we can do something together.

So that's when it all started.

But then soon we realized that it would be really nice if those carbon removals would eventually stay inside the food value chain instead of selling to airlines and banks and et cetera.

So then we started working with more and more food companies.

And by the way, for example, right now as well, one of our investors is Mondelez, the company behind the brands like Mars and sorry, not Mars, but Milka and Philadelphia and so on.

And then so we started working with food companies, but then also with banks.

We saw that banks were already giving out better interest rates if you bought electric cars or energy class apartments.

And we met with some of them and they said they would like to do the same with farmers, but it's difficult for them to say which farmer is sustainable and which farmer isn't.

So that's again where we came to help.

And today as well, our biggest investor actually.

is Swedbank, which is also the biggest bank in politics in Scandinavia.

So it has been a journey.

Soil has been part of our DNA from the beginning.

But then the broader climate topic came in slightly later.

I'm curious if you can expand a little bit on what you meant by the soil carbon kind of staying within the food value chain.

Does that mean that you prefer to sell carbon credits to stakeholders within the food value chain?

Or what exactly did you mean by that?

Yeah, exactly.

So if we would like the bread in the store to be eventually carbon neutral with emissions, then it would be key that the farmers who produced this bread would not be selling credits outside of the food value chain so that the incentives would stay inside of the food value chain.

Carbon credits, I think, are really, really good and important mechanisms to bring more flexibility.

is because not always there are stakeholders in the value chain, especially in the beginning, who are ready to finance the transition.

But the end goal is that we lower the emissions of products that we can buy in the stores.

So bread, the dairy products, pasta, and so on.

Got it.

I'm curious, does this essentially, like, would consumers be paying for, like, do products or crops that are essentially, you know, grown with these regenerative practices, do they come at a premium for the end consumer?

Yeah, it's a good question.

And there is no one answer.

So from one side, in the really the long run, producing more sustainably, I think is also more profitable.

But that's really in the long run.

So in the short run, there are some, well, it requires investment.

And that's where those incentives are needed as well.

And especially if we want to accelerate the change.

But the financing can come from different sources.

So maybe the most common one right now is in a way from the marketing budgets.

So you can see companies.

And I'm a huge fan of football.

And you can see companies spending hundreds of millions and maybe even billions by sponsoring different football clubs like Manchester United and Real Madrid and Barcelona and so on.

Why do they do it?

Because they want to connect their brand with that football club and with the sport and the tetra.

Now, more and more companies also want to connect their brand with...

because they believe that it is important for their consumers.

So part of it is coming from the marketing budget.

Part of it, but that can get us only to some extent.

But then the other part has to come from the legislative side as well and to direct more companies toward reducing emissions.

Understood.

And how about like...

how do things look from the farmer's perspective?

Like what does farmer engagement look like in practice and what motivates farmers really to adopt these, you know, climate friendly practices?

Yeah, good question.

So the way how we sell is actually by promoting sustainable farming practices.

So that's our main sales channel or tactic.

We set up field trials and events in all of the regions where we operate and to show it, to farmers in their own neighborhood what is working and what is not working.

For example, trying out different cover crop mixes, trying out different ways to implement cover cropping, doing a show where different direct drilling equipment is presented to farmers and having international and local speakers and then also local farmers sharing their stories and so on.

And all this to make sure that farmers see that they find something that works for them.

Because I met, and in one of those events, I met a farmer who, he was in his 50s, and he said he has only 11 harvests left.

And if you have, because you can only try once a year in farming, and if you have only 11 harvests left, and then it makes sense for you to continue as you were doing in the past 20 years or 30 years.

Because doing any kind of risk, any kind of change is a risk for you.

So that's why we have to show the farmers in their own neighborhoods what works and what doesn't.

And then the main goal for them still kind of to explain to farmers that this is good for your soil and this is good for your farm in the long run.

And the carbon income is not like a second yield in a year.

So it's not like huge money.

But it covers the cost of implementing these practices that are really good for the soil.

It's a bit like health insurance for the soil rather than like the huge profit generator for farmers.

And how do you demonstrate that to farmers?

And how long does it take actually to, you know, fully make a shift?

Yeah, well, the second answer is easy.

You can never do the fully shift.

You can never shift it fully.

And the nature is always changing and you have to change with this.

If you just continue with one thing and one practice in the nature, then eventually nature gets used to this and all the insects and disease and everything, it gets used to this.

And that means that you're in trouble.

So change is the name of the game.

Impact can come already from, in a way, some of the impact can already come from the first year.

There are some things like reductions in fuel costs or reductions in nitrogen -based fertilizers and so on.

But the benefit from soil organic carbon increase, they come in five to even 10 years.

But the first thing I think that farmers regarding soil that they will stop noticing is the...

soil biology changing.

So you will have more earthworms over there and you will have more good soil life.

And that makes nutrients more available for the crops.

But to actually build up the soil organic carbon levels, that takes time.

And then the long -term benefit over there is that you have basically bigger soil bank when it's raining a lot.

you can observe the water and when it's long, when there are long dry periods, then you also can take it from the reserves.

But we do all kinds of activities to present those to farmers and in a way, it's a challenge because you cannot give any concrete things that they do this and this will certainly happen because it's nature.

But we are doing field trials and during those events, for example, digging holes in the ground so that farmers can see how the water is moving in places where the soil carbon is high versus where it's low and kind of presenting in all those different ways and also inviting as many as possible other farmers who are already doing these practices and are happy that they're doing these practices.

This definitely sounds like a more honest and more transparent take on soil carbon than I've heard from other companies in the field.

So like in these works and in these demonstrations and, you know, meeting with farmers, are you seeing a lot of skepticism or pushback?

Because, for instance, I know that in the U .S.

there's a lot of talk about regenerative agriculture and carbon farming.

But the reality is that there's only a very, very small percentage of farmers who enroll in these programs, even if like a larger percentage of them says that, yes, this would be great.

And like, yes, we would like to, but like for whatever reasons, they can't do it.

So what's the situation like in Europe?

Yeah, well, what we hear from farmers is a lot of practical obstacles.

That's something that you are hearing from farmers.

Just to give you an example, and it depends on the region, the obstacles are a bit different, but in some regions it's lack of rain regarding cover cropping.

In other regions it's actually too much rain so that in the spring you want to make sure that your field would get ready faster and then some of the practices might make it more difficult.

And well, as I mentioned, we tried to, based on this feedback, we tried to experiment as much as we can ourselves.

And we also suggest farmers to start with one field so that they don't have to do a transition on their entire farm.

It makes sense for them to try it out, to find something that works for them and then scale it up gradually.

But that's true.

I mean, these practices are not common yet.

So there is a long journey ahead of us.

But there is also some Some positive aspects like that are supporting the transition, like high energy prices and et cetera.

So farmers see that the way how they operate right now is also not working perfectly.

So they are interested in trying out something new, but they're also kind of in the most positive way, they're skeptical about doing any kind of change as they would if it would be some.

new chemical or fertilizer that they never have heard about using that product.

Absolutely, yeah.

So I'm curious, how much do you hold the farmer's hand?

For example, if someone's interested in enrolling in a carbon farming program, are they required to first transition, start applying certain practices, and then they can come to you?

Or do you help them along the way?

What's the process look like?

Well, in the carbon offsetting program, it has to be additional practice.

So, I mean, farmer, they might have been doing something before, but they have to do something additional to get credits.

But in some other cases, additionality might not be that relevant.

Like, for example, giving out sustainable loans.

It doesn't matter if...

if farmer was doing it before or is just doing it.

But how much do we hold their hands?

That's one of the kind of things that we try to do, but obviously it's challenging as well to do it cost effectively.

So all farmers who join our programs in the beginning, they go through something that we call consultation.

So that is to kind of give them the general overview and understanding.

But then we are setting up those field events that we do a few times a year.

And those field events and trials also are in a way similar to Apple stores where farmers can come and see also when the event is not happening.

So then we do like smaller field walks and discussions show different practices to farmers and also...

They can ask questions regarding their own farm.

Now, more and more, we're also integrating all kinds of AI support.

And I think in general, AI is very capable in advising farmers.

But what it lacks is the context about that specific farm.

So that's something where we can help and combine those world -class.

AI models with the context about the specific farm so that the advice would actually be relevant.

I'm really glad you brought that up, actually.

So correct me if I'm wrong on this, but I understand that a major value proposition of eAgronom is your digital platform and monitoring capabilities.

So I'm very curious how exactly these tools can ensure credible MRV for soil carbon.

And if possible, can you walk us through the whole process of collecting data?

we do a lot of field trials and events, then the biggest part of our R &D effort goes into automating the data collection.

And because, well, overall to have a credible carbon process, there are many details, but in principle, there are three key things.

So you have to have a credible data collection and you have to have good data.

You have to have a credible soil model.

And then you have to have credible soil sampling as well.

If you have those three, then broadly speaking, you will do quite well.

And we are working with some other world -class companies on soil modeling and soil sampling.

So we don't do it ourselves in -house, but we partner with different companies.

Like in case of soil modeling, we work with the Thailand company.

In some areas, we work with the Thailand company, Armosa.

Italian soil model, Armosa.

There's been enough from University of Milano and in some other regions we work with the DNDC model operated by Regrow.

And then on the soil sampling, we also have some external partners.

So that's where we work with other experts who are doing their job really well.

But then our job is to make sure that we get good quality data into the system.

That has been also a journey.

So obviously, I guess the benefit is that we started as a farm management system and a big part of farm management in Europe is government reporting.

So data is core of our software from the beginning and it's still one platform and one tool.

But in the beginning, when we started these programs, we collected...

Farmers were entering some of the data manually and then we use satellites and different algorithms to verify this.

It was okay in the beginning, but if you have a lot of data, then even like right now we have millions of data points generated automatically, well, generated by farmers annually.

So that means even a few percent of error rates means that our people would have to...

go over tens of thousands of mistakes and find ways to fix them.

So that's a lot.

And therefore, we started doing integrations with new tractors.

And that's, I guess, something that everybody can do.

But the problem was, and still is, that around 85 % of our clients did not have a full fleet of modern enough tractors to send the data through API automatically.

And that meant that we had to again innovate and came out with some solutions that doesn't matter the age of the tractor, it collects data automatically from the tractor.

So the key over there is that farmer would not even need to open computer or mobile app to enter the data.

But then on top of this, we also had the satellite verification where initially we also tried out many different companies and solutions that were quite promising, but their problem was that they were usually working really well in some specific region.

But then if they came to our region, they did not work that well because they didn't have training data.

So we ended up building our own satellite verification solutions as well because the key bottleneck over there was good quality training data for those models.

Okay, thank you.

Shifting our focus a little bit to kind of the market side of things.

I'm very curious, have you seen any kind of changes in buyer behavior in the market?

Or what kind of trends do you see overall?

I think there are, especially being in Europe, there are maybe globally two trends and then the third one in Europe as well.

The first thing is that, well, after...

after various scandals, buyers tend to do their own due diligence more thoroughly themselves as well.

So many buyers, they don't just go for the cheapest credits, but they also care about the quality and the additionality, the measurement and the verification and et cetera.

So they want to make sure that one credit actually equals one ton of CO2 removed from the atmosphere.

So that's one.

It's not 100 % there, still majority of them, but it's moving there.

Then the second part is that market seems to be moving toward removal -based credits.

So instead of emission reduction or emission avoidance, removal -based credits seem to be more and more interesting for buyers, even though still...

biggest part of the global market is global south emission reduction and emission avoidance projects but just I guess the challenge is more on the supply side than on the demand side and then the third thing that's more European related it seems that even though right now European credit buyers represent around 30 % of the market European projects represent only half a percent of the market.

So there is a big mismatch, but we think with some, well, but Europe is working also on the EU commission level to make sure that that is changing and there will be more projects happening in Europe and also that the credit buyers would be interested more in European credits compared to credits coming from abroad.

But like you mean, Would this have to do more with regulation, with pricing, with reliability?

Would make essentially European credits more attractive?

Yeah, I think key developments over there are EU CRCF, Carbon Removal Certification Framework, that is building a standard for Europe to clarify what is carbon credit and what is not.

And part of this, well, right now...

at least the teams that this framework will be only for projects coming from Europe.

And then the other part are directives similar to green claim directive that are more and more closely monitoring how and what companies can say regarding their green claims.

And even though that's not set in stone yet, but I believe that eventually, If a company wants in Europe to say that they are carbon neutral, they have to use credits coming from the CEO carbon certification framework.

Okay.

Another thing that kind of came to mind, do you guys work with any ratings agencies?

Since you said that, you know, buyers are doing their due diligence and all that, popped in my head that that might be a useful thing kind of to help them make decisions.

about carbon credit purchases?

Yeah, I think it will be eventually.

Right now, we're about to issue our first credits under Verra VM42.

So that has been the big focus and that took quite some time.

But also including some rating agencies in the next step is important to make sure that the credits stand out.

And we think that we actually have left even some credit kind of on the table.

And we have issued less credits than we could, I think.

But all of this to ensure highest quality.

And the rating agencies might be one of the ways how to make sure that people outside also understand this.

So Robin, that brings me to my next question, which, I mean, we kind of covered already some of the various difficulties that you're already facing.

And like with any emerging industry, there's obviously going to be plenty of those.

But if you had to kind of choose one or two main ones, what would you say are the biggest hurdles to scaling soil carbon and regenerative agriculture globally and in Europe?

Well, I think in our business in general, data collection and data quality is the biggest challenge.

And I think it's not possible to scale the carbon program if you haven't automated it fully.

or kind of framing it differently, it might be possible to scale it, but the fraud risk is increasing and that's something that we want to avoid.

So data collection is the key.

And that's the area where we put a lot of R &D efforts, as I mentioned.

Now, the other thing is all the...

unknowns related to the market demand and the policy and regulations and etc so that's also something that well we see that our quality will stand out enough to make sure that the market is there but this is something where there is some uncertainty regarding the future developments and as far as like the policy landscape goes we mentioned the eu crcf would you say that current regulations as they are right now are they more of a help or a hindrance in adopting regenerative practices i think i think if we go to the same if we continue on the direction then it will help and they think that um and and also i see that carbon credits and regional practice, they might bring some flexibility.

It seems that in Europe, we are entering the area of climate pragmatism, where from one side we see that, well, climate change is happening and we have to do something about this.

But then at the same time, there is strong pressure to the budgets.

For example, also farming budgets, agriculture subsidies that are right now the biggest part of the budget, 55 billion euros a year.

And also there's pressure to the economy.

If you just say to all of the companies that they have to reach to zero emissions by a certain date, then that means that just kind of those businesses will move out of Europe, which is also challenging.

And in democracy, I think is not realistic outcome.

So therefore, there is a lot of potential, but also there are some challenges and there is uncertainty.

This uncertainty is the biggest risk and problem, I guess.

Yeah.

And well, so kind of on the flip side of that, do you think the voluntary carbon market has...

what it takes to offer enough incentive, you know, to kind of grow carbon markets, scale them, incentivize regenerative practices, even if government support is kind of lacking.

Certainly to some extent, I think the area where we need most government support is clarifying the playing field.

So that's one of the risks that we see is, for example, that EU CRCF is going to be too vague and not clear enough and the barrier will be something that some companies see enough and others don't.

don't see enough and it won't clarify the field.

But if that would be done by the government, then even without any financial support or directing companies to take some action, but just assuming that the market kind of continues evolving on its own, then I think the outcome will be rather positive.

Okay, that's an optimistic take for one, because some folks don't really share that opinion and are fairly worried that any lack of government support will really just, you know, not help us grow the market fast enough to actually, you know, meet any net zero targets.

Companies and countries see that it will be kind of too expensive to reach climate targets without carbon credit and they might provide some flexibility.

So that's something that makes me kind of optimistic.

But only if those credits actually reach the desired outcome.

So in the end, globally speaking, it doesn't matter where we are storing the carbon or where do we reduce emissions.

the goal is to reach certain targets, right?

And it might be even good to start from the places that, well, that are more, where the emission reduction or storage is more efficient, especially if it provides some additional benefits like biodiversity and water quality, et cetera, as well.

But, so I think carbon credits have a really good potential to be, to actually flourish in this area.

But only, if they are real and if they're actually additional and measured and et cetera.

Absolutely, yeah.

Many of the, not many, well, there's not that many of them to begin with, but like the major standards, like gold standard, Vera, I know it's a top priority for them, like the co -benefits.

Okay, you're sequestering, you're storing carbon, sure, but all of the rest of the stuff has to be there.

Like you have to be helping local communities, all of this other stuff that's just as important, if not even more so, to avoid, you know, the...

As you mentioned, scandals that have been surfacing lately where local communities actually end up being harmed by these projects and things aren't done as advertised.

So on that note, how do you see soil carbon and the whole soil carbon movement developing in the years ahead, both in Europe and also beyond its borders?

Yeah, well, I think in Europe, those credits and removals will kind of, all this market will start working more and more inside the food value chain.

But there will be, the offsetting part will stay still over there.

I think a few years ago, maybe, well, even a year or kind of 18 months ago, there was a lot of talk that offsetting is dead and it's all about insetting.

I think that's not true as well.

because offsetting is providing this flexibility in the beginnings to already bring farmers on board and get the action started before you have the value chain players ready to support.

But overall in Europe, I think, well, it makes sense that it moves more toward inside the value chain.

Now about Global South, like we also have a small pilot in Africa, in Rwanda mainly.

like close to 100 ,000 hectares.

And over there, we don't add any new farmers right now.

We don't grow this.

We just want to do it with this initial set of farmers until we figure out all data collection in Africa as well, because it's completely different and much more challenging with smallholder farmers.

But anyways, I think over there, those credits will be eventually sold to governments because you don't have local kind of companies or food sector players who are interested in this, but it will be more this Article 6 type of trading between governments to help, for example, European Union this last maybe 4 % of the emissions or something like this.

But you mentioned co -benefits and especially in Africa, It's so important.

These projects can have so much more beyond the carbon.

They can actually help local communities and increase the food security.

So in Europe, farmers would not starve if they don't have the yield.

They will have a really bad economic situation, but they can still go and buy food from the store.

But the farmers who we work with in Africa, they actually rely on this food that they're growing.

And since in these warm climates, the soil is even more fragile and then everything, all the improvements and destruction of the soil is happening much faster as well.

Meaning that these kinds of projects, they can have huge benefits.

And that's also kind of the key reason why.

We still have this small pilot.

We have some projects that we call lab, like laboratory, where we don't see immediate benefit, but we think that in five years, maybe they will be ready to scale really quickly.

Are you worried about a shortage of carbon credits in the near term?

I think there is going to be shortage of European -based credits.

That's the thing.

Because I think Europe will see that even if it won't kind of, demand companies to buy a lot of carbon credits I think one thing that they will do in this area of protection is that they will say that all this like billion and eventually billions of euros that companies are spending, European companies are spending on carbon credits and that today goes out from Europe why not direct it to European farmers and forest owners for example and then At one moment, there might be lack of carbon credits, but that's the tricky part, that the timing is really important.

So if those things are a bit late, then there also might be a short period when it's challenging to sell credits, so that there will be a really big supply.

But then eventually, the closer we get to 2030, I think this...

things kick in and there will be too little supply of European projects.

Just to clarify, do you think we're closer to an oversupply of credits right now than we are to a shortage?

Globally speaking, I don't know.

It's really difficult to estimate this.

But if you think about European projects, then I think I'm really certain that at one point we get to the place where there is There is lack of credits, but for a short period of time, there might be oversupply.

Depends how quickly some things move.

Like, for example, if EU will be on, as the timeline is, that in 2028, the carbon removal certification framework comes out, but then also...

They will say that, okay, in European companies, you don't have to buy carbon credits, but if you already buy them and if you continue buying them, then you can only use them in the claims in Europe if they come from this EU framework, then certainly there will be a lack of supply.

But if these kinds of statements are late, then there might be also too much supply for some time.

All right.

Well, Robin, that brings me to my final question for you today.

We covered what the future might look like for carbon markets and soil carbon in particular.

But what about e -agronome?

What do you guys have lined up for the future that you can share with us right now?

Well, one thing is we are about to issue our first carbon credits, which is a really, really big thing because These farmers did their first practices already a few years ago and then it has been a really long certification process under VERA VM42.

Farmers have already done also second round of practices and the third round of practices and actually right now doing the fourth round of practices.

And these credits come with a bit of lag as well.

But we are getting really close to this.

I think that we have been working for many years already.

So that's really a big thing.

And that gets our company to the next stage as well.

We have so far raised 20 million euros.

And once the first credits are issued, we want to raise another 20 million euros to be around.

Fantastic.

That's really exciting news.

Please do reach out to us.

Once your credits are issued, we'll definitely be on the lookout.

Robin, thank you.

Thank you so much for taking the time to be here today and for all these explanations of how you guys are essentially helping reshape farming practices in Europe.

It's really definitely helpful and amazing work you guys do.

So thank you again and definitely looking forward to all these exciting new developments taking place.

Yeah, thanks a lot.

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