Supporting climate-resilient African smallholder farmers through carbon markets

This policy brief examines the potential for carbon markets to provide finance for climate-resilient smallholder farmers in Africa. It argues that while carbon markets can fund climate-smart agricultural practices that improve soil health and food security, significant barriers—including strict credit requirements, high costs, and a lack of localized research—currently limit participation. The document calls for policymakers to move away from 'one-size-fits-all' regulations and instead prioritize frameworks that value non-carbon co-benefits like nutrition and economic development.

• Climate finance is heavily skewed toward energy and transport, leaving food systems and smallholder farmers severely underfunded. In 2023, food systems received only 4.3% of global climate finance allocations, while smallholder farmers received just 0.8%.
• Climate change poses a severe threat to African food security, with projections suggesting crop production in the region could drop by 18% by 2050, potentially leaving 200 million people facing extreme hunger.
• Soil degradation is a critical issue in sub-Saharan Africa, where approximately 65% of agricultural land is classified as degraded. Implementing land management to improve 'green-water' (infiltrated rainfall) in smallholder farms is estimated to cost between $250 and $500 per hectare.
• The voluntary carbon market has experienced a significant decline, with its annual value dropping 61% from 2022 to $723 million in 2023. However, credits that offer social and biodiversity co-benefits continue to command a price premium, though this premium decreased from 63% in 2022 to 37% in 2023.
• African smallholder farmers face high barriers to entry in carbon markets due to increased stringency in standards. These obstacles include high soil sampling costs, a lack of localized peer-reviewed research, and demanding evidence requirements for land tenure and baselines.
• Agricultural carbon projects in Africa are extremely limited. Out of roughly 720 global agriculture projects generating voluntary credits since 2011, only 12 could be identified for the entire African continent.
• The livestock sector in sub-Saharan Africa is a global hotspot for emission intensities due to low-quality feed, poor animal health, and low productivity. However, integrating livestock into regenerative systems can improve soil fertility and water retention.
• Policymakers are advised to avoid 'one-size-fits-all' regulations and instead prioritize carbon market processes that deliver evidence-based non-carbon outcomes, such as nutrition, food security, and economic development.

APA

South African Institute of International Affairs (2024). Supporting climate-resilient African smallholder farmers through carbon markets. https://saiia.org.za/research/supporting-climate-resilient-african-smallholder-farmers-through-carbon-markets/

Chicago

South African Institute of International Affairs. Supporting climate-resilient African smallholder farmers through carbon markets. 2024. https://saiia.org.za/research/supporting-climate-resilient-african-smallholder-farmers-through-carbon-markets/.

Wikipedia

{{cite report |author=South African Institute of International Affairs |title=Supporting climate-resilient African smallholder farmers through carbon markets |date=13 November 2024 |url=https://saiia.org.za/research/supporting-climate-resilient-african-smallholder-farmers-through-carbon-markets/ |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{southafricaninstituteofinternationalaffairs2024supporting, author = {{South African Institute of International Affairs}}, title = {{Supporting climate-resilient African smallholder farmers through carbon markets}}, institution = {South African Institute of International Affairs}, year = {2024}, month = nov, url = {https://saiia.org.za/research/supporting-climate-resilient-african-smallholder-farmers-through-carbon-markets/}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }