Carbon Markets in African Livestock Sectors: A Scoping Study and Research Agenda Sept. 2025 Authors: Kopal Jain*, Deepika Dokka*, Todd Crane^ *GSD Global ^The International Livestock Research Institute (ILRI) Report Contents Participation of African Smallholder Livestock Producers in Carbon Markets April, 2025 Table of Contents .............................................................1 Abbreviations ...................................................................4 Glossary of Carbon Framework Terms ..........................5 Executive Summary Purpose of the report ....................................................7 Key Findings and Insights .............................................7 Introduction .......................................................................8 Background on Livestock Farming and Climate Change The Role of Carbon Finance in Livestock Systems Objectives of the Report Methodology Literature Review Approach ..........................................9 Market Analysis Framework ..........................................9 Stakeholder Engagement Process ................................9 Interview Guide Development .......................................10 Data Collection and Analysis Approach ........................10 Literature Review ..............................................................11 Background on Livestock Farming and Climate Change Overview of Carbon Finance Mechanisms for Livestock Producers ......................................................................12 Clean Development Mechanism (CDM) ............12 Verified Carbon Standard (VCS) .......................13 REDD+ (Reducing Emissions from Deforestation and Forest Degradation) ...................................13 Payment for Ecosystem Services (PES) ...........14 International Climate Finance Programs ...........14 Voluntary Carbon Markets .................................14 Case Studies of Existing Carbon Credit Livestock Farming Projects in Africa National Biogas Program, Burkina Faso .................15 Herding for Health, Botswana .................................16 Mafisa Livestock Grazing Carbon Project, Namibia 16 Uganda Dairy Biogas Program ................................17 Sustainable Agroforestry-based Dairy Value Chain in Mount Elgon, Kenya ................................................18 Contents i Contents Case Studies of Globally Successful Livestock Farming Based Carbon Projects Mootral’s Methane-Reducing Feed Supplement (Multiple regions) .....................................................18 Dairy Farmers of America’s Carbon Credit Initiative (US) .........................................................................19 Carbon Farming Initiative—Beef Cattle Herd Management (Australia) ..........................................19 Market Analysis Carbon Credit Market Analysis: Global and Africa ........20 The African Context: Players, Growth, Barriers, and Emerging Opportunities and Challenges ......................24 Carbon Credit Pricing for Agriculture and Livestock ......26 Market Access for African livestock producers ..............27 Future Outlook for Carbon Pricing in Livestock .............27 Latest Developments Expected to Drive Carbon Market Growth ...........................................................................28 The Role of Certification Bodies in Carbon Finance Certification Requirements for Carbon Credit Projects in Africa ....................................................................28 Overview of the Carbon Certification Bodies Operating in Africa ...................................................28 Breakdown of Benefit-Sharing Mechanisms for Smallholder Livestock Producers ..................................32 Carbon Policies and Regulations across Key Markets .32 Recommendations for Africa Carbon Market Policymakers ...........................................................34 Challenges Deep Dive for Livestock-Based Carbon Projects Demand-side Challenges ..............................................38 Supply-side Challenges .................................................40 Stakeholder Insights Land tenure and long-term commitments ................44 High costs, delayed & unstable payments ...............44 High MRV Costs & Technical Challenges ................45 Negative press, suspicion and misinformation ........45 Government policy and regulatory challenges ........46 Barriers to livestock programs .................................47 What solutions are being implemented to address the above challenges? ...................................................47 Opportunities and Areas of Improvement ................48 Contents ii Contents Critical Perspectives on Carbon Markets and Livestock Systems Ambiguities and Misconceptions with the Livestock Agroforestry Solution .....................................................50 The Methane Conundrum: Short-lived yet Potent but Permanent? ...................................................................51 Case In Point: Case Study: Northern Rangelands Trust (NRT) ............52 Strategic Recommendations 1. Encourage the Development of Livestock-Specific Carbon Finance Models ................................................52 2. Propose Strategies to Lower Barriers to Entry for Smallholder Farmers .....................................................53 3. Scale Proven Livestock Carbon Finance Models ......53 4. Explore Untapped Countries for Livestock Carbon Finance .........................................................................53 Appendix Notable Carbon Finance Programs in Africa .......................55 In-depth country-by-country comparative analysis of key carbon and livestock-specific carbon policies Kenya ......................................................................62 Tanzania ..................................................................63 Zimbabwe ................................................................64 Zambia ....................................................................65 South Africa .............................................................66 Nigeria .....................................................................67 Ghana .....................................................................68 Rwanda ...................................................................69 Uganda ....................................................................70 Ethiopia ...................................................................71 Interview Questions Organized by Stakeholder Categories 1. Carbon Finance and Livestock Experts .....................72 2. Policy and Regulatory Stakeholders .........................72 3. Farmers and Farmer Cooperatives ...........................73 4. NGOs Supporting Smallholders ................................73 5. Carbon Project Implementers ...................................73 6. Financial Institutions and Investors ...........................74 7. International Development Partners ..........................74 Contents iii Abbreviations CCM - Compliance Carbon Markets CDM - Clean Development Mechanism CER - Certified Emission Reductions CSR - Corporate Social Responsibility DAF - Dynamic Agroforestry ESG - Environmental, Social, and Governance frameworks ETS - Emissions Trading System GHG - Global Greenhouse Gas JI - Joint Implementation MRV - Monitoring, Reporting, and Verification NDC - Nationally Determined Contributions REDD - Reducing Emissions from Deforestation and Forest Degradation VCM - Voluntary Carbon Markets VCS - Verified Carbon Standard CGIAR Carbon Markets in African Livestock Sectors: A Scoping Study and Research Agenda iv Glossary of Carbon Framework Terms 1. Additionality A core criterion for carbon credits requires that the emission reductions would not have occurred without the incentive provided by carbon finance. Projects must prove that their outcomes go beyond what would have happened under a “business-as-usual” scenario. 2. Avoidance A type of carbon credit where emissions are prevented from occurring. For example, using biodigesters avoids methane emissions from unmanaged manure. Avoidance credits are common in cookstove, REDD+, and livestock biogas projects. 3. Carbon Credits A tradable permit representing the right to emit one metric ton of carbon dioxide (CO2) or its equivalent in other greenhouse gases. These credits are generated by projects that reduce, avoid, or remove emissions and are sold on carbon markets. 4. Carbon Offsets A mechanism by which emissions produced in one area (e.g., by a company) are compensated by supporting emission- reduction projects elsewhere. Offsets can include renewable energy projects, reforestation, or improved livestock management practices that reduce methane. 5. Compliance Carbon Market (CCM) Regulated markets established by governments under schemes like the EU Emissions Trading System (ETS). Participation is mandatory, and prices tend to be higher and more stable than in VCMs. 6. Insetting Refers to emissions reductions or removals that occur within a company’s value chain (e.g., dairy companies supporting carbon-sequestering feed or grazing practices among their suppliers). It strengthens sustainability within a business’s own operations or supply network. 7. Leakage Occurs when an emissions reduction in one area causes an increase in emissions elsewhere. For instance, restricting grazing in one region might shift livestock-related emissions to another. 8. Monitoring, Reporting, and Verification (MRV) A process to ensure that emissions reductions are accurately measured, documented, and validated by third-party verifiers. MRV is essential to maintain trust and transparency in carbon credit systems. 9. Offsetting A broader term than insetting, where an entity compensates for its emissions by funding carbon-saving projects outside its operations, often in different sectors or geographies (e.g., a company buying carbon credits from a livestock rotational grazing project in Africa). CGIARv Carbon Markets in African Livestock Sectors: A Scoping Study and Research Agenda 10. Permanence The assurance that emissions reductions or removals are maintained over time. In livestock carbon projects, permanence is a challenge due to changing herd sizes, climate variability, or land use changes. 11. Reduction Emissions are reduced through improvements such as feed additives, improved manure management, or efficient grazing systems. Reductions are distinct from avoidance in that they refer to lowering emissions from existing activities rather than preventing future ones. 12. Removal Refers to taking carbon dioxide out of the atmosphere. In the livestock sector, this may include reforestation, silvopastoral systems, and soil carbon sequestration. Removal credits tend to fetch higher prices due to their perceived permanence. 13. Voluntary Carbon Market (VCM) A market where individuals, companies, or governments voluntarily buy carbon credits to offset their emissions, without being mandated by law. These markets are typically less regulated and feature a range of project types and standards. CGIAR Carbon Markets in African Livestock Sectors: A Scoping Study and Research Agenda vi Executive Summary Purpose of the report The purpose of this report is to assess the impact of carbon financing projects on livestock producers in Africa, with a focus on the opportunities, risks, and challenges faced in integrating smallholder livestock producers into carbon credit markets. The report examines existing carbon finance mechanisms, evaluates their effectiveness, and explores potential models for scaling up participation among smallholder farmers. Key Findings and Insights There is increasing potential for livestock-based carbon credit projects in Africa, particularly in areas where methane reduction strategies can be implemented. However, smallholder livestock producers face numerous challenges in accessing carbon markets, including a lack of technical expertise, limited financial resources, and complex certification processes. While carbon finance can provide an additional revenue stream, current pricing structures and verification costs often make it difficult for smallholder farmers to participate profitably. Inconsistent policies and a lack of government support further hinder the adoption of carbon finance initiatives for livestock producers. Some pilot projects have demonstrated the feasibility of integrating smallholder farmers into carbon finance mechanisms, but scalability remains a challenge due to funding and logistical constraints. Partnerships and collaboration between governments, private sector actors, and non-governmental organizations (NGOs) are critical for creating an enabling environment for smallholder participation. A summary of key points is given below: l Projects emphasizing non-carbon outcomes have shown greater effectiveness compared to direct financial transfers to smallholder livestock producers, which have historically been inadequate and inconsistent. l There is increasing skepticism regarding carbon credits among smallholder farmers and NGO partners in Africa. l Carbon credit initiatives are advancing of relevant policy frameworks, notably in the livestock sector, which remains inadequately addressed in Nationally Determined Contributions (NDCs). l Smallholder livestock producers face heightened risks of land appropriation, particularly within sustainable grazing- based carbon credit projects. The establishment of additional smallholder cooperatives and the creation of local Validation and Verification Bodies (VVBs) can significantly enhance the efficacy and credibility of carbon credits involving smallholder livestock producers. CGIARPage 7 of 74 Carbon Markets in African Livestock Sectors: A Scoping Study and Research Agenda Introduction Background on Livestock Farming and Climate Change Livestock farming is a cornerstone of agriculture and food security, particularly in developing regions such as sub-Saharan Africa, where it provides a primary source of income and nutrition for millions of smallholder farmers. However, livestock farming is a significant contributor to climate change, accounting for approximately 14.5% of global greenhouse gas (GHG) emissions, primarily through methane emissions from enteric fermentation and manure management.1 In Africa, the demand for animal-source food is projected to increase due to population growth, urbanization, and rising incomes.2 However, the expansion of livestock farming has also been linked to environmental challenges such as deforestation, land degradation, and water stress. In many regions, unsustainable grazing practices contribute to desertification and biodiversity loss, further exacerbating the effects of climate change3. Addressing these challenges requires a balance between supporting livestock productivity and implementing climate-smart practices that mitigate emissions and enhance resilience. The Role of Carbon Finance in Livestock Systems Carbon finance offers a potential mechanism to incentivize sustainable livestock management while generating additional income for farmers. Participation in carbon markets can incentivize livestock producers to adopt climate-smart practices such as rotational grazing, silvopastoral systems, and improved manure management, which contribute to carbon sequestration and emissions reduction while reaping both monetary and additional non-carbon benefits. Livestock systems have been integrated into carbon finance schemes in various contexts, particularly in agroforestry and rangeland restoration projects4. Objectives of the Report This report provides a comprehensive analysis of the opportunities and challenges facing livestock producers in carbon finance markets in Africa. The key objectives are: ● Evaluating Current Participation in Carbon Markets: Assessing how livestock producers currently generate revenue from carbon credits and the effectiveness of existing models. ● Identifying Challenges: Examining regulatory, technical, market, and socio-economic barriers that limit livestock producers’ engagement in carbon finance on the African continent. ● Developing a research agenda: Outlining cutting-edge questions and issues relating to the governance of carbon finance and livestock systems. ● Developing Strategies for Growth: Proposing research-driven solutions to overcome challenges and ensure equitable and sustainable participation. By addressing these objectives, this report contributes to policy discussions, informs stakeholders on best practices, and provides actionable recommendations to integrate African livestock producers into carbon finance markets effectively and equitably. 1 FAO (2013). Tackling Climate Change Through Livestock: A Global Assessment of Emissions and Mitigation Opportunities. Rome: Food and Agriculture Organization of the United Nations. 2 Herrero, M., Thornton, P. K., Notenbaert, A. M., et al. (2014). “Smart Investments in Sustainable Food Production: Revisiting Mixed Crop- Livestock Systems.” Science, 345(6188), 1250085. 3 IPCC (2019). Climate Change and Land: An IPCC Special Report on Climate Change, Desertification, Land Degradation, Sustainable Land Management, Food Security, and Greenhouse Gas Fluxes in Terrestrial Ecosystems. 4 FAO (2021).Climate-Smart Livestock:Addressing Challenges and Enhancing Opportunities.Food and Agriculture Organization of the United Nations. CGIAR Carbon Markets in African Livestock Sectors: A Scoping Study and Research Agenda Page 8 of 74 Methodology Literature Review Approach An exhaustive literature search was conducted across Google Scholar and various institutional websites (e.g., FAO, World Bank, ACMI, Deloitte) to understand the existing landscape of carbon finance mechanisms with a focus on livestock agriculture in African contexts. The search employed keyword combinations such as “livestock,” “carbon finance,” “Africa,” “carbon offset,” “emissions reduction,” “smallholder,” “rangeland,” and “pastures,” utilizing Boolean search commands (AND, OR, NOT) to capture relevant studies and avoid duplication. Only peer-reviewed manuscripts and reputable industry reports—particularly those published within the last five to seven years—were included to ensure both timeliness and credibility. Initial screening involved removing duplicate records and excluding sources that did not address key objectives, namely identifying gaps in current knowledge and potential entry points for livestock producers in carbon markets. Further filtering was guided by the geographical emphasis on Africa and the applicability of research findings to smallholder-based livestock offset programs or comparable emerging market contexts. Thematic analysis was subsequently employed to categorize literature by central themes (e.g., barriers to entry, financing mechanisms, policy environments, success factors), while any restricted- access or non-relevant articles were excluded. A cross-referencing approach was also applied, whereby the references of retained articles were reviewed for additional insights on best practices, pilot projects, or foundational models. This process ultimately generated a curated body of academic and industry sources that offered both comprehensive and context-specific perspectives on carbon finance for African smallholder livestock farming systems. Through this iterative review and synthesis, key knowledge gaps were highlighted, informing the need for supplemental primary data collection and stakeholder interviews. Market Analysis Framework For the market analysis, we applied a structured framework evaluating market size, demand, regulatory conditions, and funding, focusing primarily on Africa alongside global benchmarks. We categorized carbon markets into compliance, voluntary, and international trading through Article 6, examining global volumes, values, prices, and regulatory mechanisms such as the Kyoto Protocol, EU ETS, carbon taxes, and ETS models. Due to its high prevalence in Africa, the voluntary carbon market (VCM) was specifically assessed in terms of offsetting, insetting, and additionality, clearly distinguishing carbon credits from offsets (avoidance, reduction, removal). The framework compared carbon pricing methods (carbon taxes, ETS, offsetting), emphasizing pricing differences and influencing factors globally. Finally, the analysis included a targeted overview of African carbon markets, highlighting key markets, certification standards, project implementers, funders, and the comparative scale of CCM and VCM, particularly emphasizing VCM and the types of carbon credits. Stakeholder Engagement Process We identified a diverse array of stakeholders critical to the carbon finance value chain for smallholder livestock producers. These included carbon finance and livestock experts (e.g., Verra, BioCarbon Standard, Plan Vivo, Climate Action Reserve), policy and regulatory officials (Ministries of Agriculture, Environment, and Climate Change), farmer organizations (e.g., Kenya Dairy Farmers Federation, Fulani Herdsmen Cooperative), NGOs supporting smallholders (e.g., Heifer International, SNV, Solidaridad, One Acre Fund), carbon project implementers (REDD+, ICRAF, Conservation International), financial institutions and investors (e.g., Rabobank, African Development Bank, World Bank), and international development partners (e.g., IFAD, GEF, USAID, GIZ). Our primary outreach methods consisted of reaching out to our substantial network of contacts in the carbon field, in addition to cold emailing, LinkedIn engagement, and snowball sampling; this led to contact with over 80+ individuals and resulted in 25+ interviews. Further details on stakeholder engagement are provided in the stakeholder CRM and in the Appendix, which has links to interview transcripts. CGIARPage 9 of 74 Carbon Markets in African Livestock Sectors: A Scoping Study and Research Agenda Interview Guide Development We structured the interview guide according to stakeholder categories, incorporating both closed-ended and open-ended questions but emphasizing open-ended formats to capture detailed insights. For carbon credit developers, we explored existing livestock-focused carbon credit programs and measurement methodologies, examined barriers for smallholders, and investigated the influence of long-term contractual arrangements and innovative finance on farmer participation. We also probed how verification and certification processes could be simplified to foster broader inclusion and equitable benefit- sharing. For technical experts and researchers, questions centered on identifying the most effective emissions-reducing or carbon- sequestering livestock practices (e.g., biodigestors, rotational grazing), supported by real-world data from smallholders. We further examined the key technical barriers encountered in these systems and the potential for emerging innovations to accelerate emissions reductions over the next decade. Government bodies were asked about relevant policies, legislative gaps, and incentives that support smallholders’ entry into carbon finance. These inquiries addressed the magnitude of program uptake, revenue-sharing requirements, national scaling strategies, emissions reduction targets, and the role of third-party verifiers. In parallel, questions to carbon market regulators focused on the challenges, costs, and benchmarks for certifying livestock-based carbon projects, particularly concerning fair revenue-sharing, reporting burdens, and replicable success models. They also covered guidelines on minimum revenue- sharing percentages, the function of third-party verifiers, and best practices suited to African contexts. In speaking with farmers and farmer organizations, we examined the degree of farmer participation in carbon credit programs, the practicality of sustainable livestock practices, and the financial incentives required to promote adoption. We further explored their openness to entering long-term contracts and the potential for collective models, like cooperatives, to reduce participation costs via resource pooling and shared services. NGOs supporting smallholders were queried on their role in assisting farmers to engage with livestock-focused carbon finance, the principal hurdles they encountered, and the financial and technical resources essential for successful outcomes. We also sought lessons from agroforestry carbon programs—especially where NGOs function as intermediaries—and assessed how these lessons might transfer to livestock initiatives. Carbon project implementers were asked about the scope and impact of livestock or agroforestry carbon projects, with attention to measurable outcomes, risk mitigation strategies for smallholders, equitable revenue-sharing arrangements, and the technological or payment systems that underpin successful program scaling. For financial institutions and investors, we examined the spectrum of financing mechanisms (e.g., microloans, upfront payments, blended finance, Pay-for-Performance, and input subsidies) influencing smallholder participation and return on investment in livestock carbon ventures. We also investigated whether innovative funding models from other sectors (e.g., pay-as-you-go) could be adapted to support sustainable and scalable livestock programs. Finally, questions for international development partners targeted existing funding mechanisms for smallholder livestock carbon initiatives, capacity-building efforts, examples of high-impact pilot programs, and the alignment of donor funding with private carbon finance to expand participation and outcomes. For a full list of questions, see the Appendix section, ‘Interview questions’. Data Collection and Analysis Approach Interviews were conducted through in-person meetings, phone calls, or video conferencing based on stakeholder availability and connectivity. Where permissible, audio recordings were made with informed consent, and transcripts were subsequently generated. To address potential gaps in transcription, the interviewer also maintained detailed notes. Throughout the process, transparency, confidentiality, and anonymity were upheld at the request of participants, and no data will be published without signed consent. Additionally, all outreach leads have been cataloged in a centralized CRM sheet, which can be found in the Appendix. For data analysis, both quantitative and qualitative findings from the interviews were verified against secondary sources wherever feasible. In cases where a particular stakeholder category could not be interviewed, in-depth secondary research was employed to compensate for the missing perspectives. CGIAR Carbon Markets in African Livestock Sectors: A Scoping Study and Research Agenda Page 10 of 74 Literature Review Background on Livestock Farming and Climate Change For African countries, livestock production is a critical part of the agricultural economy and contributes to roughly 40% of their agricultural GDP5. Livestock plays multiple roles as a source of income, diversified income, as a household capital asset, and is integral to the social, cultural, and economic fabric of approximately 33 million smallholder farming families in Africa. Smallholder livestock farming for the sake of this report includes a producer who rears livestock and cultivates crops on a limited scale (less than 10 acres of land), including methods like pastoralism, agro-pastoralism, mixed farming, and, in some cases, ranching. Moreover, livestock will be an increasingly important commodity for sub-Saharan Africa as the demand for animal-source food increases by approximately 80% from 2010 to 20306 due to rising population, urbanization, and increasing disposable income. The backs of rising demand and increasing food insecurity are the animal protein sector’s contribution to approximately 14.5% of global anthropogenic GHG emissions. In Africa, at least 70% of agricultural gas emissions come from the livestock sector. Most of these occur at the farm stage (enteric methane, manure management) or concerning input provision (feed production). In African countries, livestock contributes to 10% of global enteric methane emissions from dairy cattle. Other indirect ways of GHG contribution include land degradation and deforestation by overgrazing, with over 48% of rangelands in sub-Saharan Africa degraded due to overgrazing7. While there are multiple mitigation pathways that can be adopted (see Figure 1), financing them remains a key challenge. Globally, food systems received just 4.3% of climate finance allocations in 2023 and smallholder farmers specifically a meagre 0.8%, with Africa receiving less than 2% of this total funding8. In the next section, we shall look at some existing climate finance opportunities in the livestock sector in Africa. 5 National Library of Medicine (2021), Livestock sustainability research in Africa with a focus on the environment 6 The World Bank (2021). Opportunities for Climate Finance in the Livestock Sector: Removing Obstacles and Realizing Potential. The World Bank. 7 Ibid 8 Maguire, G. (2024). Supporting Climate-Resilient African Smallholder Farmers Through Carbon Markets. South African Institute of Interna- tional Affairs. CGIARPage 11 of 74 Carbon Markets in African Livestock Sectors: A Scoping Study and Research Agenda Figure 1: Existing Mitigation Strategies for the Livestock Sector, Source: The World Bank Overview of Carbon Finance Mechanisms for Livestock Producers In general, per the World Bank, there exist five types of climate financing streams to incentivise emission reductions in the livestock sector - blended finance, jurisdictional finance, self-finance, livestock insurance, and carbon markets. Below are some of the key carbon market finance mechanisms that have been employed in smallholder livestock communities in Africa: Clean Development Mechanism (CDM) A part of the 2006 Kyoto Protocol, the Clean Development Mechanism (CDM) allows countries to invest in emission-reduction projects in developing countries, including African nations. These projects can earn certified emission reductions (CERs), each equivalent to 1 ton of carbon dioxide (CO2). CERs can be traded and sold, and used by industrialized countries to meet part of their emission reduction targets under the Kyoto Protocol. The CDM helps host countries achieve sustainable development and reduce emissions while giving industrialized countries some flexibility in how they meet their emission targets9. For pastoral communities, CDM projects focus on: 1. Improved livestock management: To improve livestock management practices, CDM projects incentivize pastoralists to adopt methane-reducing livestock management practices like improving feed quality, manure management, rotational grazing, and improving animal healthcare to earn carbon credits. For instance, the East Africa Dairy Development Project (EADD) in Rwanda, Kenya, and Uganda, implemented by Heifer International and the Bill and Melinda Gates Foundation was aimed at improving animal health services, breeding, and feed quality for smallholder dairy farmers. The project ran in two phases between 2008 - 2018, and the interventions are said to have reduced methane emissions intensity by 30–40%10. These projects also incentivise sustainable land management practices while providing pastoralists with additional sources of income. In addition, they encourage community and infrastructure building among pastoralist communities. For instance, Farm Africa has done extensive work in Ethiopia to build community-governed models to ensure that benefits reach participants on the ground. The organization is also working on drought risk insurance offerings for women pastoralists, further adding to the economic incentives provided by CDM projects. 9 Asian Development Bank, Clean Development Mechanism 10 Options for low-emission development in the Kenya dairy sector, Climate and Clean Air Coalition CGIAR Carbon Markets in African Livestock Sectors: A Scoping Study and Research Agenda Page 12 of 74 2. Reforestation and Agroforestry: For pastoral communities, agroforestry and reforestation promote multifunctional landscapes that contribute to livelihoods, improve land productivity, enable biodiversity conservation, and generate carbon credits to provide economic incentives. CDM projects help restore grazing lands and degraded lands, leading to direct benefits for pastoralists. The Nature Conservancy’s long-running Tanzania Rangeland Initiative is an example of the same, as the project has restored native grasslands, improved the health of rangelands, and helped communities earn up to USD36,000 each year by protecting forests and selling carbon offsets. Verified Carbon Standard (VCS) The Verified Carbon Standard (VCS) is the world’s leading carbon credit certification program, managed by Verra. It ensures that carbon offset projects generate real, measurable, additional, and independently verified reductions in greenhouse gas (GHG) emissions. Reportedly, VCS projects have reduced or removed more than one billion tons of carbon and other GHG emissions from the atmosphere11. For pastoralists, VCS programs can engage in activities like: 1. Sustainable Land Management (SLM): SLM initiatives can improve grazing practices, restore degraded lands, increase soil carbon storage, improve pasture quality, and enable pastoralists to participate in carbon markets. Verra has developed methodologies such as VM0017 and VM0024 to certify the projects under SLM. An example of a successful SLM project is the Jatropha Agroforestry Project. The project integrated Jatropha trees into existing farming systems in semi-rural areas of Senegal to enhance soil fertility, provide biofuel, and sequester carbon12. 2. Rangeland Rehabilitation: A part of SLM practices, rangeland rehabilitation projects are particularly beneficial to pastoralist communities as they improve biodiversity, enhance ecosystem services, and sequester carbon through activities such as invasive species removal and reforestation. In Ethiopia, Kenya, and Tanzania, projects like the Northern Kenya Rangeland Carbon Project, the Tanzania Rangeland Initiative, and the SLMP Ethiopia have addressed challenges such as soil erosion, deforestation, environmental degradation, and declining agricultural productivity. REDD+ (Reducing Emissions from Deforestation and Forest Degradation) In 2013, the REDD+ framework was created by the United Nations Framework Convention on Climate Change (UNFCCC) to reduce deforestation in developing countries. Using carbon finance, REDD+ projects fund community activities that reduce emissions from deforestation and forest degradation. For the private sector, purchasing carbon credits generated through these projects is considered one of the best ways to fund forest conservation and support the communities linked to it13. Additionally, the REDD+ framework has been included in the Paris Agreement, allowing countries to use REDD+ to achieve their Nationally Determined Contributions (NDCs) to reduce greenhouse gas emissions. All projects under this framework are also verified and validated by the global standards such as VCS, Gold Standard, and the American Carbon Registry. In Africa, REDD+ initiatives often intersect with livestock systems, especially where pastoralism and agro-pastoralism are prevalent. For pastoralist communities, these projects train them in and incentivize sustainable land practices, biodiversity conservation, support access to clean water and sanitation services, and also prevent wildfires and illegal logging. Additionally, pastoralists and farmers can benefit from forest produce such as fruits, nuts, honey, and cocoa14. The REDD+ projects in Kenya and Tanzania mainly focus on nomadic and semi-nomadic herding of cattle, goats, and sheep. In Ethiopia’s highlands, these projects combine crop cultivation with livestock rearing. In Ethiopia, Kenya, Tanzania, and the DRC, stationary animal husbandry practices are integrated with community-based forest management. 11 Verra 12 World Agroforestry Centre, Community Biocarbon Projects in West Africa 13 REDD+ projects 14 ibid CGIARPage 13 of 74 Carbon Markets in African Livestock Sectors: A Scoping Study and Research Agenda Payment for Ecosystem Services (PES) These are payments made to farmers or landowners for protecting nature or practicing sustainable ecosystem services. PES is a market-based mechanism similar to taxes or subsidies that encourages the conservation of natural resources. Under these schemes, farmers/landowners/communities that are managing and using natural resources are paid to manage their resources to protect watersheds, conserve biodiversity, or capture carbon through practices like tree plantation and their management, or by adopting certain sustainable agricultural practices15. These payments can be made by the national or local government or the beneficiaries of the ecological services, such as water users or power consumers. There is a growing interest in PES from the private sector, especially the tourism sector. Since 2016, the Central African Forest Initiative (CAFI) has been implementing a PES model in the Congo Basin. The participants receive direct payments for sustainable forest and agriculture management and forest conservation. Over 80,000 direct beneficiaries are expected to participate in these schemes and are likely to receive at least USD150 million in PES over the next few years.16 International Climate Finance Programs International bodies and multilateral development finance institutions such as Green Climate Fund (GCF), Asian Development Bank (ADB), the European Union (EU), the Adaptation Fund, and the Climate Investment Funds (CIF) are funding multiple projects in Africa focusing on renewable energy development, climate-resilient agriculture, water access, emissions reduction, and community adaptation projects. A latest report by Climate Policy Initiative (CPI) commissioned by FSD Africa reported that climate finance flows in Africa have grown by 48% to USD 44 billion in 2021-2022, up from USD 30 billion in 2019-202017. Voluntary Carbon Markets Voluntary Carbon markets allow companies, NGOs, governments, and individuals to buy and sell carbon credits to offset their emissions. This market is categorized into two structures: Primary and secondary markets. Primary markets are responsible for the initial issuance and sale of carbon credits directly from project implementors/ developers to buyers. The credits are often purchased in advance to finance the project, so there is a greater degree of transparency involved. In secondary markets, carbon credits that were issued in the primary market are resold and traded between intermediaries, investors, and end-users. The resale is carried out through brokers, exchanges, or platforms, and price fluctuations are common due to market demands and speculation. In secondary markets, businesses can buy credits as per their requirements without being involved in the project development18. 15 International Institute for Environment and Development, Markets and Payments for Environmental Services 16 CAFI, Spotlight on Community Forestry 17 Climate Policy Initiative, Press Release 18 Ecosystem Marketplace CGIAR Carbon Markets in African Livestock Sectors: A Scoping Study and Research Agenda Page 14 of 74 Case Studies of Existing Carbon Credit Livestock Farming Projects in Africa Table 1 - Overview of Mitigation Practices and Types of Carbon Credits Mitigation Practice Avoided Emissions/Reduction Removal Agroforestry (e.g. silvopastoral systems) Grassland Management (e.g. rotational grazing) Manure Management (e.g. biodigesters) Dietary Modifications (e.g. improved feed supplements) Regenerative Agriculture (e.g. no-till farming) National Biogas Program, Burkina Faso Overview: The National Biogas Program of Burkina Faso recognises the serious health, environmental, and economic effect of indoor air pollution caused by burning solid wood fuels, and encourages the subsidized construction of small- scale biodigesters for rural households, which can reduce air pollution by converting manure and organic household into a clean cooking fuel as well as a nutrient-rich fertiliser for improving agricultural productivity The program, which was started in 2014, is supported by Ci-Dev, which purchases carbon credits generated by 35,000 biodigesters to be installed during the program’s development, and the revenue generated will be used to scale up the National Biogas Program of Burkina Faso. The project is expected to reduce greenhouse gas emissions by 540,000 tons of CO2 by 2025. Benefit Sharing and Co-benefits- As part of the initiative, households using biodigesters generate an average of 25 tons of compost annually per unit. This output meets their own domestic needs while also producing extra compost that can be sold to neighboring households without biodigesters. In areas where biodigesters are in use, there has been a notable decline in chemical fertilizer use. Farmers are saving around $48 per hectare while also seeing a 24% boost in crop yields. Crediting Period: 7 years, twice renewable Implementing Partner: Ministry of Animal Resources with technical support from SNV Certification Body: UNFCCC Credits Issued: As of July 2023, 28,342 Certified Emission Reductions (CERs) Credit Type: Reduction CGIARPage 15 of 74 Carbon Markets in African Livestock Sectors: A Scoping Study and Research Agenda Herding for Health, Botswana Overview: The Herding for Health (H4H) program is a collaborative initiative between Conservation International and the Peace Parks Foundation created to support rural communities near protected areas by promoting sustainable live- stock management, restoring rangelands, and conserving biodiversity. The program focuses on four aspects: a) Healthy Rangelands, b) Healthy Animals, c) Thriving Livelihoods, d) Good governance and enabling policy. A distinctive feature of the H4H program is its use of voluntary stewardship agreements with pastoralist communities. Through these agreements, participants commit to implementing managed grazing strategies, controlling invasive plant species, and adopting conservation-friendly practices. These efforts are designed to reduce overgrazing, promote bio- diversity, and improve water resource management. Benefit Sharing and Co-benefits- Pastoralists voluntarily commit to sustainable grazing practices, biodiversity conservation, and land restoration. In re- turn, they gain access to incentives, such as training, technical support, and opportunities for premium markets. Ad- ditionally, pastoralists who follow regenerative grazing practices can access certified, high-value beef markets that offer better prices for sustainably produced livestock. There is potential for communities to earn revenue from carbon credits if rangeland restoration and improved grazing practices lead to measurable carbon sequestration. Using the H4H model, the Chobe Enclave Carbon Project in the north-eastern area of Botswana is underway. The project has removed approximately 4.8 million tonnes of CO2 equiva- lent so far, as per the latest update[ Chobe Enclave Carbon Project, Rewild Capital]. H4H has been exploring partner- ships with carbon market stakeholders to develop rangeland carbon projects. Mafisa Livestock Grazing Carbon Project, Namibia²º Overview: The Mafisa Livestock Grazing Carbon Project (MLGCP) aims to generate carbon credits through enhanced grazing and fire management, utilizing VM0032 methodology i.e., adoption of Sustainable Grasslands through Adjust- ment of Fire & Grazing. MLGCP began its operational phase in 2024, following feasibility studies, baseline assessments, and validation pro- cesses. MLGCP promotes cattle grazing rotations to restore traditional grazing practices, simulate wild herbivores’ migratory patterns, and foster grassland regeneration. Additionally, it targets the reduction of burning frequency, enhancing carbon storage. MLGCP will provide animal health services for farmers participating in collective planned grazing. Anticipating annual net removals of 1 ton of CO2e/ha, the project plans to expand from 220,000 ha initially to 1.26 million ha by 2030. Projected annual carbon credit yields are set to rise from 220,000 tons CO2e in 2024 to around 1.26 million tons CO2e by 2029, sustaining until 2063. Overall, MLGCP aims to remove over 47 million tons of CO2e, contributing to long-term atmospheric carbon reduction. Governance and Monitoring: Local communities will make livestock management decisions following community- informed consent and input. Carbon rights are assigned with traditional leadership, meaning the carbon credits gener- ated are considered a community asset, and traditional leadership has the responsibility to negotiate or distribute the benefits on behalf of the community. • Track livestock numbers and movements via coordinator reports and satellite imagery to verify effective imple- mentation of Rapid Rotational Grazing. • Assess vegetation cover and composition every 5-7 years to update grazing intensity and lignin/cellulose values for accurate carbon sequestration estimates. • Coordinate data collection through trained project personnel, supervised by experts from Soils for the Future US, using standardized protocols. • Store monitoring data securely in both local and cloud-based storage systems managed by BRI and Soils for the Future LLC. • Develop clear QA/QC procedures and sampling methods, including defined precision levels and sample locations, to ensure monitoring accuracy and reliability. CGIAR Carbon Markets in African Livestock Sectors: A Scoping Study and Research Agenda Page 16 of 74 Mafisa Livestock Grazing Carbon Project, Namibia²º Benefit Sharing and Co-benefits: Phase 1 (Pre-Financing): Free animal health care services, provision of boreholes, and community development pro- gramme. Direct community benefits are projected to exceed 60% of revenue by year five and to remain above 60% on an ongoing basis. Additionally, $1 per carbon credit issued will be directed to the communities that generated those credits via the Community Development Trust. Phase 2 (Post-Revenue): 68% community direct benefit. On top of this, a minimum of 65% of surplus revenue will be allocated to the Community Development Trust. Crediting Period: 40 years Certification Body: Verra Credit Type: Reduction Uganda Dairy Biogas Program²¹ Overview: The Uganda dairy digester project (Waste to Fuel: Improving Agriculture and Livelihoods in Uganda) aims to curb greenhouse gas emissions while fostering tangible co-benefits for local communities in partnership with Sistema. bio. The project includes 7 sizes of biodigesters to adjust to the different types of farmers. Officially launched on October 18, 2022, the project focuses on smallholder dairy farmers in Uganda, especially subsistence farmers who typically use woodfuel or LPG for their energy needs both in the household and productive uses in the farm, and who currently do not manage the manure generated by their animals and have either solid or liquid storage practices for this. Over 36 months, the project plans to distribute small-scale digesters to over 10,000 farming households. It is expected to avoid an average of approximately 99,000 metric tonnes of CO2-equivalent emissions per year. Benefits Sharing and Co-Benefits: No clear benefit-sharing ratios have been outlined. Participating smallholder dairy farmers transfer their carbon credit rights to Sistema.bio in exchange for flexible payments and comprehensive monitoring of the biogas digester units. According to a stakeholder from Sistema.bio, the smallest biodigester unit (the project offers seven sizes) costs ap- proximately 1.5 million Ugandan Shillings (~$USD400). Carbon credits can subsidize up to 50% of this cost, enhancing accessibility for smallholder farmers[ Interview with Sistema.bio, 2025]. The project anticipates co-benefits such as cost and energy savings, improved quality of life for women, and employment creation. Although farmers are expected to fund replacement components themselves, ongoing discussions suggest potential support for those unable to afford spare parts; however, implementation status remains unclear. Certification Body: Gold Standard Crediting Period: 4 years Credit Type: Avoidance/Reduction ²ºVerra Registry, 2024, Mafisa Livestock Grazing Carbon Project ²¹Gold Standard Registry, 2022, Uganda Dairy Biogas Program CGIARPage 17 of 74 Carbon Markets in African Livestock Sectors: A Scoping Study and Research Agenda Sustainable Agroforestry-based Dairy Value Chain in Mount Elgon, Kenya²³ Overview: The project, implemented by the NGO Vi Agroforestry in collaboration with the Livelihoods Fund (co-found- ed by Danone) and Brookside Dairy Limited (Danone owns a stake), addresses poverty, environmental degradation, and climate change in Kenya’s Mount Elgon region. It promotes improved livestock feeding and husbandry alongside climate-smart agricultural land management. Its goals include enhancing health and nutrition, increasing crop and milk productivity and quality, and encouraging widespread adoption of sustainable land practices. Vi Agroforestry collabo- rates with East Africa Marketing Development Associates (EAMDA) to support 15 dairy cooperatives in establishing dairy business hubs. The project is pre-financed by the Livelihoods Fund SICAF SIV and Brookside Dairy Limited. Vi Agroforestry is a technical contributor. Governance and Monitoring: 30,000 farmers are organized in farmer groups at the lower level and cooperatives at the upper levels for efficient delivery of extension services. Affiliate farmer groups under different farming cooperative societies (FCS) will be structured into clusters/blocks of 5-10, with each farmer group having 15-30 farmers. Standard- ized training materials are used to deliver extension services via field officers and community facilitators on improved dairy livestock management, including modules like fodder establishment and management, dairy feeds and feeding, cow breeding management, dairy cow housing, milk hygiene, and handling. The French Facility for Global Environment also financed activities relating to gender inclusion and developed Village Savings and Loan Associations. Benefits Sharing and Co-Benefits: The project is expected to increase yield on subsistence & cash crops by 30% and increase milk production from 5,000 l/ day to 135,000 l/day in 5 years. Eventually, it will provide feed for cows all year, avoiding uncontrolled grazing & substantially increasing milk production. The Livelihoods Fund will also inject upfront carbon finance to incentivize climate-smart practices. In addition, Brookside has committed to purchasing milk produced by farmers for 10 years at a fixed price. Certification Body: Gold Standard Crediting Period: 14 years Credits Issued/ Credits Expected: 49,065/1,000,000 Credit Type: Avoidance/Reduction Mootral’s Methane-Reducing Feed Supplement (Multiple regions)²⁴ Overview: Mootral is a Swiss Agri-tech company that has developed a natural feed supplement that significantly re- duces methane emissions from ruminants. The supplement is called Mootral Ruminant (or Mootral). Mootral is made of garlic powder and citrus extracts, and the supplement can be easily incorporated into the feed chain[ Mootral, Cow Cred- its ]. Mootral uses VM0041 methodology and is responsible for implementing the project, along with issuing the credits. In December 2019, Verra approved Mootral’s methodology for reducing methane emissions from livestock, enabling the generation of carbon credits. The company has implemented projects in its flagship farm in the UK, Netherlands, and is in the process of adding a flagship farm in Texas, US., Trials are underway to assess the supplement’s effectiveness in regions like the US, Europe, Latin America, and Oceania. Benefits: No clear benefit-sharing ratios have been outlined. A commercial dairy farm trial involving Jersey and Hol- stein-Friesian cows reported methane emission reductions of 38.3% and 20.7%, respectively, during a 12-week supple- mentation period. Additionally, milk yield increased significantly for both herds without compromising milk quality[ Open Journal of Animal Sciences (2019), “Reduction of Enteric Methane Emission in a Commercial Dairy Farm by a Novel Feed Supplement” ]. Certification Body: Verra Credits Issued/ Credits Expected: Not disclosed publicly. As of August 2023, Mootral reported that 3,000 CowCredits had been purchased by UK businesses. Credit Type: Avoidance/Reduction Case Studies of Globally Successful Livestock Farming Based Carbon Projects ²³Gold Standard, Sustainable Agroforestry Based Dairy Value Chain in Mount Elgon, Kenya ²⁴Mootral ²⁵Mootral, Cow Credits ²⁶Open Journal of Animal Sciences (2019), “Reduction of Enteric Methane Emission in a Commercial Dairy Farm by a Novel Feed Supplement” CGIAR Carbon Markets in African Livestock Sectors: A Scoping Study and Research Agenda Page 18 of 74 Dairy Farmers of America’s Carbon Credit Initiative (US)²⁷ Overview: The Dairy Farmers of America (DFA), in partnership with Elanco Animal Health and Athian, launched a carbon credit initiative to reduce methane emissions in dairy operations across the US. Farmers incorporate Elanco’s innovative feed management products, such as Rumensin, into their cattle’s diet. These additives enhance feed ef- ficiency and reduce enteric methane emissions by approximately 0.5 metric tons per cow annually. Reportedly, the program achieved a reduction of nearly 1,150 metric tons of carbon dioxide equivalent (CO2e) emissions. The first sale of its verified carbon credits was completed in January 2024. Athian – the carbon marketplace for the livestock industry – has developed an insetting marketplace that enables the aggregation, verification, and certification of greenhouse gas reductions within the livestock value chain. In November 2023, DFA received $22.8 million from the U.S. Department of Agriculture’s Regional Conservation Part- nership Program (RCPP). This grant supports the implementation of innovative feed additives aimed at reducing meth- ane emissions on dairy farms nationwide[ Dairy Farmers of America, Press Release]. Certification Body: Athian Credits Issued/ Credits Expected: Not disclosed publicly; at least 1,150 Credit Type: Avoidance/Reduction Carbon Farming Initiative—Beef Cattle Herd Management (Australia)²⁹ Overview: The Beef Herd Methodology, part of the Carbon Farming Initiative, allowed beef producers to earn carbon credits by improving the efficiency of their herds. This efficiency was typically achieved by breeding cattle that produced more with fewer resources or increasing daily weight gains, ultimately reducing emissions per unit of beef produced. Large-scale, beef-producing companies such as AA Co, Consolidated Pastoral Company, and Paraway Pastoral Com- pany have benefited from this for years. These companies led the way in implementing more sustainable cattle man- agement practices and have been credited with substantial emissions reductions. Cattle Australia - a grassroots orga- nization representing Australian cattle producers reported that just 11 projects have generated over 953,000 Australian Carbon Credit Units (ACCUs), equating to more than one million tonnes of emissions offset[ Ag Carbon Central, Cattle Australia condemns decision to suspend carbon methodology ]. However, in December 2024, the Emissions Reduction Assurance Committee (ERAC), which oversees the integrity of carbon methodologies, concluded that the Beef Herd Methodology no longer met the necessary Offsets Integrity Stan- dards (OIS). The decision was based on a periodic review that raised concerns about the methodology’s compliance with the expected standards for emissions reduction projects. The suspension will last until September 30, 2025, and no new applications for carbon offset projects under the Beef Herd Methodology will be considered. While existing projects and registered participants can continue to accrue ACCUs (Australian Carbon Credit Units), no new registrations will be accepted during the suspension period[ Department of Climate Change, Energy, The Environment and Water, Australia, Beef Cattle Herd Management Method]. This recent setback showcases how livestock carbon offset programs require a careful balance between regulation, innovation, and the economic realities farmers face. Certification Body: Emissions Reduction Assurance Committee (ERAC) (Australian government body) Credits Issued/ Credits Expected: 953,000 Credit Type: Avoidance/Reduction ²⁷Dairy Farmers of America, Press Release ²⁸Dairy Farmers of America, Press Release ²⁹Department of Climate Change, Energy, The Environment and Water, Australia, Beef Cattle Herd Management Method ³ºAg Carbon Central, Cattle Australia condemns decision to suspend carbon methodology ³¹Department of Climate Change, Energy, The Environment and Water, Australia, Beef Cattle Herd Management Method CGIARPage 19 of 74 Carbon Markets in African Livestock Sectors: A Scoping Study and Research Agenda Market Analysis Carbon Credit Market Analysis: Global and Africa Over the past decade, carbon markets (see Figure 1 for an overview) have grown substantially around the globe, reflecting an increasing urgency to address climate change through market-based mechanisms (see Figure 2). Between 2013 and 2023, almost USD 42 billion was spent on the origination and development of 11,752 registered and pre-registered carbon-credit projects worldwide, with approximately ~ USD 22 billion occurring between 2021 and 202319. REDD+ (Reducing Emissions from Deforestation and Forest Degradation) projects accounted for 78% of the coverage area—equivalent to 40 million hectares—while nature restoration initiatives encompassed a further 11 million hectares. The compliance market (governed by regulations) currently overshadows the voluntary carbon market in terms of both size and liquidity, with a global carbon dioxide permit market valued at USD 948.75 billion in 2023 compared to an estimated voluntary market size of around USD 2 billion the same year20. Nonetheless, projections suggest that the voluntary carbon markets could expand to between USD 10 and USD 25 billion by 203021, contingent on the ambition with which countries and industries pursue decarbonization objectives. Moreover, agriculture land management (ALM) based voluntary carbon credit programs, which include livestock mitigation practices, have emerged as a growing focus for investors post-2020. Notable investment occurred in 2021 (USD 0.4 billion), having increased fourfold from 2020 (USD 0.1 billion) and then by a further two-thirds in 2022, to peak at USD 0.7 billion. Between 2021 and 2023, ALM accounted for 12% of all nature restoration expenditure22. 19 MSCI (2024), “Investment Trends and Outcomes in the Global Carbon-Credit Market” 20 Reuters (2024), “Global carbon markets value hit record $949 bln last year - LSEG” 21 Regreener, “Voluntary and Compliance Carbon Markets: the difference” 22 MSCI (2024), “Investment Trends and Outcomes in the Global Carbon-Credit Market” CGIAR Carbon Markets in African Livestock Sectors: A Scoping Study and Research Agenda Page 20 of 74 Figure 2 - Overview of Carbon Markets CGIARPage 21 of 74 Carbon Markets in African Livestock Sectors: A Scoping Study and Research Agenda Carbon Pricing and Market Dynamics Carbon pricing refers to initiatives that put an explicit price on GHG emissions, i.e., a price expressed as a value per ton of carbon dioxide equivalent (tCO2e), influencing the economic feasibility of emission reduction projects. Figure 2: Price of Carbon Across the World, Source: The World Bank In general, there are 5 types of carbon pricing methods: Figure 3- Overview of 5 Types of Carbon Pricing CGIAR Carbon Markets in African Livestock Sectors: A Scoping Study and Research Agenda Page 22 of 74 Compliance Carbon Markets (currently comprise approximately 75 operational carbon tax and emissions trading systems (ETS) globally23) 1. A carbon tax directly sets a price on carbon by defining an explicit tax rate on GHG emissions. It is different from an ETS in that the emission reduction outcome of a carbon tax is not pre-defined, but the carbon price is. 2. An ETS permits regulated entities to trade emission allowances as a cost-effective strategy to fulfill emission targets. Two principal ETS models exist: ○ Cap-and-trade systems, which apply a cap or absolute limit on the emissions within the ETS, and emissions allowances are distributed, usually for free or through auctions, for the amount of emissions equivalent to the cap. ○ Baseline-and-credit systems, where baseline emissions levels are defined for individual regulated entities and credits are issued to entities that have reduced their emissions below this level. These credits can be sold to other entities, exceeding their baseline emission levels. Voluntary Carbon Markets (VCM) 1. A crediting mechanism, operating with its accounting protocol and registry, designates the GHG emission reductions from project- or program-based activities, which can be sold either domestically or in other countries 2. Results-based climate finance (RBCF) is a finance mechanism in which disbursements are contingent on the verified achievement of predetermined outcomes, such as emission reductions. In contrast to the predominant model of international public climate finance, where approximately 95% of funds are provided upfront, RBCF payments are made upon the realization of results, sometimes including interim milestone disbursements. 3. Internal carbon pricing is a tool an organization uses internally to guide its decision-making process concerning climate change impacts, risks, and opportunities. Carbon credit prices vary widely across markets. In CCM, prices are generally higher due to enforced demand. The CCM, dominated by the EU Emissions Trading System (EU ETS), California Cap-and-Trade, and China’s National ETS, has seen carbon prices range from $30 to $100 per metric ton of CO2 equivalent (tCO2e) in regulated markets24. VCMs, which operate outside government mandates, typically have lower prices, ranging from $5 to $20 per tCO2e, depending on project type and certification standards25. Under the VCM, prices differ significantly across carbon credits, whether by using market dynamics as a guide, pricing a project based on its cost, or based on the value that a project delivers. This heterogeneity in pricing stems from some of the factors below: 23 World Bank (2023), “State and Trends of Carbon Pricing” 24 World Bank (2023). “State and Trends of Carbon Pricing 2023” 25 Ecosystem Marketplace (2024), “State of the Voluntary Carbon Market 2024” CGIARPage 23 of 74 Carbon Markets in African Livestock Sectors: A Scoping Study and Research Agenda Table 1 - Factors Influencing VCM Project Carbon Credit Prices Size of the Project Small projects are priced higher to recuperate costs. Market Economics A higher supply of a specific type of carbon credit from a region can inevitably reduce prices. E.g.. Carbon credits from wind projects based in India (which are in abundance) sold at an average of $1.2/tonne compared to those originating from the US, which typically sold for $3.7/tonne. Buyer Willingness to Pay Companies might pay more for carbon credits from themes/projects that are prioritised in their Corporate Social Responsibility (CSR) strategy, which outlines how a company will operate ethically and sustainably, balancing economic, envi- ronmental, and social considerations to positively impact society beyond legal requirements. Age of the Credit Older credits may be priced higher than newer credits due to the urgency of decarbonization, as perhaps an emission reduced/removed earlier is far more valuable now. Emission Reduction Methodologies Additionality applies, i.e. difference between planned and unplanned emission reduction with planned being higher. Quality of Project The quality of the project can depend on the certification standard used. Beyond Carbon benefits Projects that deliver value beyond climate security, adhering to other SDG goals that have more tangible benefits at a direct community level, tend to be priced higher. Reduction vs Removal Reductions are achieved through energy efficiency, the substitution of renew- able energy for fossil fuels, or the avoidance of degradation or destruction of natural carbon sinks such as forests. Removals are generated through nature- based methodologies, including afforestation, reforestation, and revegetation (ARR), or engineered solutions, including direct air capture and biochar produc- tion. In 2023, the price premium for trades of removal credits (~$15.91) versus reduction credits (~$4.61) was 245 percent. The African Context: Players, Growth, Barriers, and Emerging Opportunities and Challenges Against this global backdrop, Africa finds itself emerging as a potentially significant player in the carbon credit landscape. As of 2021, Africa’s voluntary carbon market grew by 36% since 2014, compared to the global average of 31%. Recognizing a significant opportunity, the African collegium launched the African Carbon Markets Initiative (ACMI) in 2022 to channel climate finance into African nations, thereby promoting clean energy access, sustainable agriculture, and rural development. According to the ACMI 2022 Roadmap Report, Africa could scale its carbon credit market ~20 times by 2030, mobilizing up to USD 6 billion in revenue and supporting as many as 30 million jobs. Demand in African carbon markets reportedly grew by 11% in 2023, with supply dipping only 1% during the same period. Moreover, approximately 90%26 Africa’s recent credit supply is attributed to avoidance projects, particularly those related to deforestation and cleaner cookstoves, which are notoriously lower priced than removal projects. Despite this growth, the market remains somewhat fragmented, as just five countries account for around 65% of total issued credits, with Kenya holding the highest share at 23% (see Figure 4). International climate finance flows remain heavily concentrated in a small number of African countries, with the top ten countries receiving 46% of total funding, while the ten African countries that are most vulnerable to the negative impacts of climate change receive only 11% of the finance, leaving them severely underfunded. 27 26 Africa Carbon Markets Outlook 2024-2025 - Africa Carbon Markets: Status and Outlook Report 2024-25 27 Climate Policy Initiative (2024), Landscape of Climate Finance in Africa CGIAR Carbon Markets in African Livestock Sectors: A Scoping Study and Research Agenda Page 24 of 74 Figure 4 - Carbon Credit Issuances Overview Across Africa Source: Carbon credits market access for smaller-scale clean energy projects 2023, EEP Africa and Nordic Development Fund However, demand for agriculture (both avoidance and removal) based carbon credits, which includes livestock, has declined since 2021, largely due to declining trust in the REDD+ projects, which, along with cookstove carbon projects, comprise 90% of African credit supply since 2022. On a global level, although many compliance schemes have yet to fully incorporate livestock emission reductions, the European Commission is considering expanding its Carbon Removal Certification Framework (CRCF) by 2026 to include livestock management activities. Meanwhile, the global ruminant methane reduction market was valued at USD 2.6 billion in 202328 and is expected to expand at a CAGR of 7.3% from 2024 to 2032, suggesting a robust future for emissions- cutting strategies in ruminant-dominated systems. Methane recovery from animal manure is also gaining traction because it can generate comparatively high volumes of credits, given methane’s stronger global warming potential relative to CO2, despite its shorter longevity. 28 Global Market Insights (2023). Carbon Credit Market Size, Growth Forecasts 2025–2034. Global Market Insights. CGIARPage 25 of 74 Carbon Markets in African Livestock Sectors: A Scoping Study and Research Agenda Figure 5 - Voluntary Carbon Project and Program Development Lifecycle, Source: VCMI, Climate Focus Carbon Credit Pricing for Agriculture and Livestock Nature-based solutions, including agroforestry and regenerative livestock practices, command higher prices due to their co- benefits, such as biodiversity conservation and rural livelihood improvements. For example, high-quality credits from agroforestry projects have been sold for over $15 per tCO2e29. These prices also include intermediary fees, which are not well documented, but have been estimated to be upwards of 15% of sales prices and can reach up to 300% in extreme cases30. However, the true price potential of smallholder agroforestry carbon credits is unclear due to the small number of existing projects, the opacity of the market, and rapid market development.31 Methane reduction projects, such as those involving improved manure management or biogas production, tend to attract premium prices, given that methane has a higher global warming potential than CO2. The price of methane credits can be as high as $50 per tCO2e in some compliance markets32. 29 Trove Research (2021). “Carbon Credit Pricing Trends in Nature-Based Solutions.” 30 ACMI (2024), “African Carbon Markets: Status and Outlook Report 2024-25” 31 TechnoServe (2022), “Carbon finance for smallholder farmers and agribusinesses Analytical briefing on agroforestry solutions” 32 Gold Standard (2023). Methane Reduction in Agriculture: Market Insights CGIAR Carbon Markets in African Livestock Sectors: A Scoping Study and Research Agenda Page 26 of 74 Market Access for African livestock producers African livestock producers often face challenges in accessing carbon markets due to high certification costs and complex verification requirements. The cost of project validation and verification under standards like Verra’s VCS can range from USD 50,000 to USD 150,000 per project, making it difficult for smallholders to participate without financial support33. Smallholder-focused initiatives such as Rabobank’s ACORN platform are opening voluntary carbon markets to farmers in Kenya, Uganda, and beyond by harnessing advanced remote-sensing tools34. ACORN measures stored carbon on a farmer’s land using high-resolution satellite imagery, slashing the MRV costs that typically arise from field crews, specialised equipment, and extensive training. While exact savings differ from project to project, the potential is striking: GIZ’s Satellite-Based Digital Solutions for Climate-Friendly Agriculture programme in Kenya and India has documented an 80–90 % drop in the per-hectare cost of tracking soil-carbon gains compared with traditional methods35. Aggregation models, where multiple farmers bundle their credits into a single project, have also been successful in reducing transaction costs. Programs like the Kenya Biogas Program have demonstrated how collective participation can improve market access and increase returns for farmers36. Future Outlook for Carbon Pricing in Livestock Demand for agricultural carbon credits is expected to grow as corporations seek credible offset solutions to meet net-zero commitments. According to McKinsey & Company (2023)37, the voluntary carbon market could reach $50 billion by 2030, with nature-based solutions playing a central role. Regulatory changes, such as the expansion of Article 6 mechanisms under the Paris Agreement, are likely to have a positive and upward impact on carbon pricing dynamics by creating standardized frameworks for international credit trading, potentially benefiting livestock producers engaged in sustainable practices38. The anticipated market growth suggests a significant increase in carbon credit prices, especially for high-quality, nature-based solutions. Analyses conducted by the Boston Consulting Group (BCG) indicate that buyers expect to pay $25 to $30 per metric ton by 203039. 33 FAO (2021).Climate-Smart Livestock:Addressing Challenges and Enhancing Opportunities.Food and Agriculture Organization of the United Nations. 34 Solidaridad (2023), Carbon Credits and Carbon Markets: Unlocking Benefits for Smallholder Farmers 35 GIZ (2024), Satellite-based digital solutions for climate-friendly agriculture in Kenya & India 36 ACMI (2022). African Carbon Markets Initiative: Unlocking Carbon Finance for Smallholders” 37 McKinsey & Company (2021). A Blueprint for Scaling Voluntary Carbon Markets to Meet the Climate Challenge. McKinsey & Company. 38 UNFCCC (2023). Article 6 Mechanisms and the Future of Carbon Trading. 39 Boston Consulting Group (2023). In the Voluntary Carbon Market, Buyers Will Pay for Quality. BCG. CGIARPage 27 of 74 Carbon Markets in African Livestock Sectors: A Scoping Study and Research Agenda Latest Developments Expected to Drive Carbon Market Growth There are also notable policy developments under the United Nations framework that are expected to bolster demand and trust in carbon credits, including: 1. The COP29 agreement to create mutually agreed standards for a centralized carbon market under the UN (Article 6.4 mechanism), allowing for new finance channels for developing countries. 2. The launch of the Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA) aims to address carbon emissions from international aviation. It requires the purchasing of eligible items beyond 85% of the 2019 aviation baseline. Eligible credits include livestock sector practices, including grassland management and enteric emission reductions. 3. The development of the EU Carbon Border Adjustment Mechanism (CBAM), which places a carbon price on imported goods from countries with lower climate policies, encourages stronger carbon pricing worldwide. 4. The Voluntary Carbon Markets Integrity Initiative (VCMI) and ICVCM Core Carbon Principles aim to improve transparency, accountability, and the credibility of voluntary carbon markets. 5. Expansion of compliance carbon markets in emerging economies, such as China’s national Emissions Trading System (ETS), which is now the world’s largest. The Role of Certification Bodies in Carbon Finance Carbon certification bodies ensure that carbon credit projects adhere to rigorous environmental, social, and governance standards. Their requirements dictate the eligibility of projects, their monitoring and reporting obligations, and the process for verification and credit issuance. In Africa, certification requirements can be particularly challenging due to infrastructure limitations, high costs, and regulatory uncertainty. Certification Requirements for Carbon Credit Projects in Africa Carbon credit certification typically involves the following key components: 1. Baseline Assessment: Project developers must establish a baseline scenario to compare emissions reductions or carbon sequestration improvements. 2. Additionality: Projects must prove that their emission reductions would not have occurred without carbon finance support. 3. Measurement, Reporting, and Verification (MRV): Continuous data collection and independent verification ensure that emission reductions are real and measurable. 4. Permanence & Leakage Prevention: Measures must be in place to ensure that carbon storage is maintained over time and that emission reductions in one area do not lead to increased emissions elsewhere. 5. Stakeholder Engagement: Local communities must be consulted and benefit from the project’s implementation. These requirements add layers of complexity and cost, often making it difficult for smallholder farmers to access carbon finance without external support from NGOs, governments, or aggregators. Overview of the Carbon Certification Bodies Operating in Africa Certification bodies play a key role in ensuring the credibility of carbon credit projects by setting standards, verifying emissions reductions, and providing market access. The following are some of the most recognized certification bodies operating in Africa, their descriptions, ongoing projects, and the advantages and disadvantages of their certification processes for farmers. CGIAR Carbon Markets in African Livestock Sectors: A Scoping Study and Research Agenda Page 28 of 74 1. Verra (Verified Carbon Standard - VCS) Verra administers the Verified Carbon Standard (VCS), one of the most widely used carbon certification programs globally. It ensures rigorous methodologies for emissions reductions across various sectors, including agriculture and livestock, especially with the launch of the VM0042 methodology for Improved Agricultural Land Management and Sus- tainable Grassland Management methodology (VM0026)⁵⁴, ⁵⁵ . Projects in Africa ● Northern Kenya Rangeland Carbon Project: Supports sustainable graz- ing practices and rangeland regeneration, helping pastoralist communi- ties earn carbon credits. ● Zimbabwe Kariba REDD+ Project: Focuses on reducing deforestation and improving carbon sequestration through sustainable land use and agroforestry practices. Advantages for carbon developers and live- stock producers: ● High credibility and recognition in global carbon markets. ● Supports diverse project types, including livestock and land-based sequestration. ● Provides methodologies for soil carbon sequestration and methane reduction. Disadvantages ● Certification costs can be prohibitively high for smallholder farmers. ● Complex MRV requirements make participation difficult without techni- cal support. ● Lengthy validation and verification timelines are delaying revenue generation. Benefit-Sharing Mechanisms None mandated. The only mention of benefit sharing in official docu- ments is to mandate the project proponent to develop a grievance redressal procedure for benefit sharing disputes. 2. Gold Standard (GS) Gold Standard focuses on high-integrity carbon projects that deliver measurable social and environmental benefits. It emphasizes sustainable development co-benefits beyond just carbon sequestration. Together with Cargill, Gold Standard developed a methodology for beef producers. The methodology defines a series of parameters to quantify reductions in methane emissions. As of 2024, Gold Standard operates as the largest certifier in Africa, certifying 31% of African projects. Projects in Africa ● Kenya Biogas Program: Promotes household biogas digesters, reduc- ing methane emissions and providing sustainable energy solutions for rural farmers. ● Ethiopia Climate-Smart Agriculture Project: Integrates agroforestry and rotational grazing techniques to enhance soil carbon storage and biodiversity. Advantages for carbon developers and live- stock producers: ● Strong emphasis on sustainable development and community co- benefits. ● Often attracts premium pricing due to its rigorous environmental and social criteria. ● Supports smallholder farmer aggregation models to ease access. Disadvantages ● Strict sustainability requirements can limit project eligibility. ● More complex monitoring requirements compared to other certification bodies. ● Certification costs remain a challenge for small-scale farmers. Benefits Sharing Mechanisms None. The Gold Standard certification does not mandate specific benefit- sharing mechanisms in its official requirements. ⁵⁶Northern Kenya Rangelands Carbon Project ⁵⁷Kariba REDD+ Project ⁵⁸Gold Standard (2023). Ensuring High-Quality Carbon Credits in Livestock Management ⁵⁹VCMI, Climate Focus (2023), Carbon market opportunities in livestock production, and cocoa and coffee agroforestry systems CGIARPage 29 of 74 Carbon Markets in African Livestock Sectors: A Scoping Study and Research Agenda 3. Climate Action Reserve (CAR) Originally focused on North America, CAR is expanding its methodologies to international markets, including Africa, particularly in the livestock sector. Projects in Africa ● Namibia Sustainable Rangeland Initiative: Focuses on sustainable livestock grazing techniques to enhance productivity and carbon seques- tration. Advantages for carbon developers and live- stock producers: ● Provides innovative livestock and grassland-focused methodologies. ● Streamlined reporting and verification processes reduce administrative burdens. ● Encourages community participation and training programs. Disadvantages ● Limited African project portfolio compared to Verra and Gold Standard. ● Less brand recognition in voluntary carbon markets, leading to lower credit prices. ● Still developing methodologies tailored specifically to African livestock projects. Benefit-Sharing Mechanisms None mandated. No mention of “benefit sharing” in official requirement documents. 4. American Carbon Registry (ACR) ACR is one of the oldest carbon offset registries and has expanded its scope to support agricultural and livestock-based projects in developing regions. Projects in Africa ● Uganda Livestock Methane Reduction Project: Introduces improved feed and manure management to reduce methane emissions. ● Zambia Agroforestry and Carbon Sequestration Program: Enhances tree planting on pasturelands to improve carbon storage and biodiversity. Advantages for carbon developers and live- stock producers: ● Well-established methodologies for methane reduction and manure management. ● Growing presence in African carbon markets. ● Faster verification cycles than some competing certification bodies. Disadvantages ● Less extensive presence in Africa compared to Verra and Gold Stan- dard. ● Still refining methodologies to align with African livestock conditions. ● Limited financial support mechanisms for smallholders. Benefit Sharing Mechanisms The ACR program includes “a discussion of robust benefit sharing ar- rangements” for ”community-based projects” as part of its environmental and social impact assessment requirements. However, based on the public comments submitted by ACR on the draft assessment framework of the ICVCM, it seems that ACR did oppose the idea of including any mandatory requirement for benefit sharing arrangements in its standard. CGIAR Carbon Markets in African Livestock Sectors: A Scoping Study and Research Agenda Page 30 of 74 5. Plan Vivo Plan Vivo focuses on community-based carbon projects, ensuring benefits flow directly to farmers and local communi- ties. It supports smallholder-led initiatives in agroforestry and sustainable livestock management. Projects in Africa ● Tanzania Sustainable Grazing Program: Implements silvopastoral sys- tems to increase carbon sequestration and pasture resilience. ● Mozambique Community Carbon Initiative: Integrates agroforestry and sustainable grazing to enhance biodiversity and carbon storage. Advantages for carbon developers and live- stock producers: ● Lower certification costs, making it more accessible to smallholder farmers. ● Strong emphasis on equitable benefit-sharing mechanisms. ● Simplified monitoring processes tailored to community-led projects. Disadvantages ● Less widely recognized in major carbon markets compared to Verra and Gold Standard. ● Lower credit pricing, making it harder to attract large-scale investments. ● Limited methodologies for methane reduction in livestock systems. Benefit-Sharing Mechanisms An agreed Benefit Sharing Mechanism (BSM) must direct ≥ 60 % of net Plan Vivo Certificate revenue to project participants/local stakeholders. The BSM sets out who gets what, when, and how payments or in-kind support are delivered, monitoring duties and remedies, and each Project Agreement must summarize participants’ minimum entitlements and penalties for missed targets. Table 2: Some of the existing Methodologies for calculating GHG emissions, reductions, and removals applicable to livestock. Source: Climate Focus, Verra, Gold Standard Standard Methodology Scope VCS VM0026 Methodology for Sustainable Grassland Management (SGM), v1.1 VCS VM0042 Methodology for Improved Agricultural Land Management, v2.0 VCS VM0041 Methodology for the Reduction of Enteric Methane Emissions from Ruminants through the Use of Feed Ingredients, v2.0 VCS VM0044 Methodology for Biochar Utilization in Soil and Non-Soil Applica- tions, v1.1 VCS VM0047 Methodology for Afforestation, Reforestation, and Revegetation v1.0 VCS VM0032 Methodology for the Adoption of Sustainable Grasslands through Adjustment of Fire and Grazing, v1.0 GS Suppressed Demand Small-scale Methodology for Energy Use for the Processing of Agricultural Products GS Smallholder Dairy Methodology (Draft) GS Reducing Methane Emissions from Enteric Fermentation in Dairy Cows through the Application of Feed Supplements GS Afforestation/reforestation GHG Emissions Reduction & Seques- tration Methodology CGIARPage 31 of 74 Carbon Markets in African Livestock Sectors: A Scoping Study and Research Agenda Each certification body offers unique benefits and challenges for livestock carbon finance projects in Africa. While Verra and Gold Standard provide high market credibility, their stringent requirements can be cost-prohibitive. On the other hand, Plan Vivo presents a more accessible model for smallholders, but at the cost of lower carbon credit prices. Addressing these barriers through policy support, aggregation models, and financial incentives can enhance livestock producers’ participation in Africa’s growing carbon markets. Breakdown of Benefit-Sharing Mechanisms for Smallholder Livestock Producers The Integrity Council for the Voluntary Carbon Market’s first draft of the Core Carbon Principles’ definition document defines benefit sharing arrangements as “the processes for the distribution of Monetary and Non-Monetary Benefits to Beneficiaries, including the types and proportions of benefits to be shared and the mechanism by which such benefits will be distributed.” Overarchingly, only two programs (ACR, Plan Vivo) out of the five certifiers above specifically mention “benefit sharing arrangements” in one of their standard requirement documents40. Moreover, through our primary research of some existing livestock producers based carbon projects, most benefit-sharing mechanisms lack standardization and transparency. Some benefit-sharing mechanisms include the injection of capital into community funds that are controlled by a local community leader. Very few include direct cash transfer to project participants. They rely heavily on conflating monetary benefits with non-monetary “co-benefits”. General literature on carbon benefit-sharing mandates by certifying bodies is divided on whether certification bodies should be involved in consultation processes or distribution of benefit-sharing agreements. Verra, for example, explains that “much information on benefit sharing arrangements will be considered confidential between the contracting parties”. An alternative proposal, instead of requirements on benefit sharing arrangements is to consider requirements on participatory processes a central issue to ensure that local stakeholders have a seat at the table during the development of a project. Carbon Policies and Regulations across Key Markets A review of Nationally Determined Contributions (NDCs) indicates that livestock-related climate actions remain underrepresented, with only 36% incorporating mitigation measures and 55% addressing adaptation strategies41. Simultaneously, the expansion of carbon market regulations globally is evident, with at least 65 countries having established regulatory frameworks, as tracked by the Gold Standard’s Carbon Market Regulations Tracker. In Africa, carbon market regulations have been implemented in select nations such as Kenya, Tanzania, Zimbabwe, Zambia, South Africa, Rwanda, Ghana, Uganda, Benin, and Egypt. Countries like Botswana, Côte d’Ivoire, Senegal, Morocco, and Mauritania have an ETS or carbon tax under consideration or development. More countries are expected to introduce formalized carbon trading mechanisms. Based on expert conversations and secondary research, Ghana, Kenya, and South Africa have the most mature carbon markets in the African context and are often used for benchmarking regulations. In the following section, we will briefly examine the legal, policy, institutional, and regulatory frameworks of selected countries involved in setting up and operating carbon markets. 40 Carbon Market Watch (2021) 41 Livestock Data for Decisions (2024), A Guide for National Policymakers to Integrate Livestock in Climate Strategies CGIAR Carbon Markets in African Livestock Sectors: A Scoping Study and Research Agenda Page 32 of 74 Figure 5 & 6 - Existing and proposed Carbon Market Legislations in African countries, refer to Appendix for further details CGIARPage 33 of 74 Carbon Markets in African Livestock Sectors: A Scoping Study and Research Agenda Legislative Frameworks and Policy Objectives Many countries are at various stages of developing or enacting carbon market regulations. For instance, Tanzania has introduced multiple draft bills—including an amendment to its Climate Change Act and dedicated carbon market regulations—while Kenya, Ghana, Zimbabwe, Zambia, and South Africa have issued or are developing regulations that establish legal and institutional frameworks for carbon trading. These legislative instruments typically aim to integrate carbon markets into national climate policies by establishing national registries, designated authorities, and mechanisms for credit trading, revenue allocation, and benefit sharing. Objectives also frequently include climate change mitigation, adaptation, and the domestication of international climate agreements such as the Paris Agreement. Market Structure, Pricing, and Registries The proposed market types are largely designed to support both voluntary and compliance carbon trading, however, Africa is dominated by the smaller, but high-growth, voluntary carbon markets. In several cases, market-based offset schemes are predominant, although some countries (for example, Zambia and South Africa) are experimenting with cap-and-trade systems or carbon taxes. The pricing mechanisms vary; while some nations rely solely on market-based pricing, others are introducing fixed fees or carbon floor prices, such as Kenya’s proposed floor pricing and Tanzania’s CA fee, to enhance price stability. Reported net effective carbon rates span a broad range, with notable disparities across jurisdictions. Complementary to these efforts, certain countries are in the process of establishing or are expected to launch national carbon credit registries to provide transparency and traceability in credit transactions. Benefit Sharing and Institutional Coordination The policies incorporate diverse benefit-sharing schemes that typically allocate a portion of carbon credit revenues to community development, environmental funds, or regulatory bodies. For example, Kenya mandates that land-based projects contribute up to 40% of earnings to local communities, whereas Zimbabwe and Zambia propose distinct models involving both project proponents and government oversight. However, countries like Nigeria, Uganda, and Ethiopia have yet to finalize their benefit-sharing policies. Supporting Initiatives and Bilateral Engagements Some countries have supplemented their domestic policies with supporting initiatives and international partnerships. Kenya’s collaboration through the J-CAP initiative illustrates efforts to attract private-sector capital, while bilateral agreements— ranging from memoranda of understanding with Japan, Singapore, and Switzerland to ongoing negotiations with European and Asian partners—indicate a strategic orientation towards international cooperation in carbon market development. Additionally, country-specific challenges and complementary actions, such as Tanzania’s engagement with UAE-based Blue Carbon for national parks, Zambia’s work with the UK on benefit-sharing guidelines, and Uganda’s ongoing regulatory implementation hurdles, are developments to be tracked. For a more in-depth country-by-country comparative analysis of key carbon and livestock-specific carbon policies, see here or refer to the Appendix. CGIAR Carbon Markets in African Livestock Sectors: A Scoping Study and Research Agenda Page 34 of 74 Recommendations for Africa Carbon Market Policymakers From the Lens of Smallholder Livestock Producers Formalizing Land Tenure Security in Carbon Policies: Carbon market frameworks should explicitly incorporate provisions aimed at strengthening land tenure security for smallholders to create a stable environment and potentially combat “land grabbing”. This can be done by statutes that acknowledge customary tenure as a legal form of ownership (with or without requiring registration). Ghana’s approach of managing lands through customary authorities but within a legal framework is one model. Kenya’s Community Land Act (2016) and Tanzania’s Village Land Act, which deem village lands as owned by communities, offer another model for strengthening land tenure. Land policies should also include mechanisms and bodies for swift dispute resolution. Social innovations, such as community-led lease guidelines or intrahousehold agreements, are additional instruments that policymakers should formally recognize to improve smallholder livestock producers’ participation in carbon finance initiatives42. Regardless of specific mechanisms, clear and strong land tenure systems are a necessary precondition for effective carbon markets. Establishing Smallholder Carbon Cooperatives, Collectives, or Producer Groups: Many climate-smart livestock projects are characterized by their small and fragmented scale, which hinders lending institutions from achieving economies of scale via reduced transaction costs. Consequently, policymakers should encourage the consolidation of individual activities by streamlining the registration process for collective cooperative contracts and introducing legislation that supports specific cooperatives with tax breaks, free training sessions, gender quotas, equipment subsidies, livestock insurance etc.. Moreover, investing in publicly accessible repositories and standard of procedures templates strengthens institutional trust and operational efficiency, thereby enabling more effective collaboration with financiers and developers. Although groups such as the Eastern Africa Farmers Federation (EAFF), of approximately 25 million smallholder farmers, have aimed to protect the interests of small-scale producers, governments must adopt a more proactive stance, as outlined in the previous paragraph. 42 Tamba, Y., Wafula, J., Magaju, C., Aynekulu, E., Winowiecki, L., St-Jacques, B., Stiem-Bhatia, L., Arias-Navarro, C., & World Agroforestry (ICRAF). (2021). A Review of the Participation of Smallholder Farmers in Land-Based Carbon Payment Schemes.TMG Research gGmbH and CIFOR-ICRAF. Figure 6 - Overview of key opportunities in African Carbon Market Policymaking CGIARPage 35 of 74 Carbon Markets in African Livestock Sectors: A Scoping Study and Research Agenda Codifying Fair Benefit-Sharing Mechanisms: African governments should codify benefit-sharing percentages and timelines within carbon market frameworks, thereby providing legal security for farmers involved in carbon finance projects. Policies should delineate clear carbon rights—akin to Kenya’s approach, whereby private land projects exempt owners from social contribution obligations—thus clarifying that private landowners retain a greater share of benefits. Ideally, these policies should strike a balance by ensuring community benefits, as observed in Ghana and Kenya (which mandate moderate levies or community benefit plans between 25% and 40%), while avoiding excessive taxation of projects, such as the initial 50% rule in Zimbabwe that led to the suspension of carbon offset issuances by the Gold Standard.43 As one stakeholder put it, “it is better to have a bad benefit sharing mechanism than none at all.” Incentivizing Projects with Non-Carbon Outcomes: Given the current low carbon prices, high administrative costs, and the emphasis on avoidance rather than reduction credits in many smallholder livestock projects, carbon payments to individual smallholders may remain minimal relative to their total income. Therefore, to encourage broader adoption of carbon finance mechanisms, it is essential to prioritize and support projects that deliver verifiable non-carbon benefits, such as improvements in food security, livestock and crop productivity, income diversification, access to bank accounts, etc., alongside carbon removals or reductions. To facilitate this, policymakers need to standardize processes for rating carbon credit co-benefits. In the African context, these co-benefits typically include improvements in food security, livestock and crop productivity, income diversification, access to financial services, and ecosystem restoration. A regional co-benefits rating framework could be developed under the leadership of African institutions such as the African Union, the African Development Bank, and carbon market alliances like the African Carbon Markets Initiative (ACMI). This framework would categorize co-benefits into themes most relevant to Africa and define a consistent set of indicators and metrics for each. For example, food security could be measured by changes in household dietary diversity or the duration of the lean season. Livestock productivity could be evaluated by improvements in milk yield, calving rates, or animal mortality. These indicators must be quantifiable, locally relevant, and aligned with existing development goals. For instance, metrics for income diversification might include the number of income-generating activities per household or the percentage increase in off-farm income. Access to finance could be assessed by the number of new mobile money accounts or uptake of savings and credit products. Gender empowerment might be tracked through metrics such as women’s participation in project governance or control over household income. Verification of co-benefits would need to be localized and trusted. This means training and accrediting local organizations and individuals to serve as third-party verifiers. These verifiers would use standardized audit tools and digital data collection platforms to gather information from project sites. Invol