Deal focus: Soil Carbon’s nascent climate fix

Last year, Australian farmer Mick Wettenhall told BBC News about his experiences with a particular type of fungi that can help carbon sequestration efforts.

Seeds treated with a microbial coating that includes the fungi have demonstrated they can reduce the amount of carbon dioxide in the air. Wettenhall, a director at non-profit research institute SoilCQuest, is trying to integrate the microbe into the existing agricultural ecosystem near Australia’s Macquarie River.

His interview piqued the interest of Horizons Ventures co-founder Solina Chau who began discussions that eventually led to a A$10 million ($7 million) round inked last week. The capital was committed to Soil Carbon, an Australian start-up dedicated to commercializing the technology. SoilCQuest is the controlling shareholder.

“The technology for carbon sequestration has been around for a while. Microbiological approaches to building soil carbon [carbon in terrestrial soil] are very new,” says Guy Hudson, CEO of Soil Carbon.   

The start-up is 18 months away from commercialization. At present, it is researching suitable seed treatments; the fungi can be provided either as a liquid or a freeze-dried product that is applied to seeds or seeds are treated before sale. “It is very scalable. Whether we're selling truckloads of coated seeds into a large industrial farm in Australia or tea bag sized packets of microbes to smallholder farmers in Southeast Asia, the technology is flexible,” Hudson adds.

Guy Webb, an agronomy pioneer who founded SoilCQuest in 2016, is enthusiastic about the technology’s prospects. He believes the international adoption of a similar process involved in “nitrogen fixing” – a certain type of bacteria is used to help trap nitrogen boosting plant growth – has already set a precedent.   

However, it will be difficult to convince agriculturists of various sizes to add an input that may not yield any immediate benefit. Soil Carbon has three priorities: explain how fungi-based treatment can work for different types of farming practices; assure a predictable outcome for users; and find ways to store the carbon underground on a permanent basis.

Hudson points out that the rising adoption of carbon offset schemes across countries means that farmers could be incentivized to support carbon sequestration efforts in this way. Moreover, rising awareness among the leading buyers of agricultural goods of the need to purchase conscientiously could help persuade farmers and input suppliers to change their ways.

In addition, Soil Carbon is open to licensing its products with the right partners to ensure universal adoption of its climate mitigation solution. Hudson observes that each market has its own nuances, which deserve recognition and analysis. “For us, it's really about how we can establish the right value chain so that farmers are rewarded for the benefit that they're providing to wider society,” he says.

With more than two billion hectares of land put to agricultural use annually, successful soil carbon sequestration could be an important development in the battle against climate change. 

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• Topics
• Australasia
• Technology
• Early-stage
• Australia
• Horizons Ventures
• Agriculture