SLM partners emphasizes “critical” income from carbon loans

Asset Manager SLM Partners presented the results of a decades of project project in Australia, which illustrates the financial and ecological returns with regenerative agriculture.

The Garrawin Carbon project was launched in 2013 after SLM acquired two properties in Queensland with a total of 80,000 hectares. The project is part of the first strategy of SLM, the SLM Australia Livestock Fund launched in 2012 with a focus on the production of cattle with grass.

“What is clear about this is the time frame,” says SLM Partners Head of Impact Alessia loan. “We have owned this country for more than 10 years and can show what happened.”

In other words, it is an insight into the long-term advantages of regenerative country management, which is still relatively new to many investors.

“It's about showing what we do and being as transparent as possible,” says lender. “It is really important to set this transparency in motion so that others [fund] Manager start so much to publish so much, [the data] Starts to become useful and we can compare it. “

A holistic pasture approach

The Garrawin project is located in the Mulga countries in Australia, an area marked by red, sandy soils, mulga and eucalyptus trees as well as shrubs and grasses. Rowlings in this region are “very variable” from one year to the next.

At the time of the acquisition of SLM, the country was conventionally managed without holistic grazing approach, says the lender. In the broader region of Mulga Lands, around 94% of the country “have” “have” adverse effects on the landscape due to clarifications and overgrowns, “the report says.

According to lenders, a very common practice in the area is to fell the mulgas trees, which are to be used as cattle food during droughts or periods with low precipitation. The disadvantage of this practice is that farmers enable more cattle to keep in their country than is reasonable during a drought, which leads to pasture pressure, land deterioration and soil erosion.

SLM used a holistic planned grazing strategy for the Garrawin project, in which pasture management techniques are used, which imitate natural Weidemuster of wild patterns. Animals are kept in herds and moved frequently, and the country receives long periods of recreation between evidence events.

“We would like to make sure that we will not get back to graze this patch until it is completely recovered. We would like to make sure that we grow back the more nutritious species and the multi -year grass. The key is short pasture times and long rest periods,” notes the report.

Carbon loans' critically in drought ''

Groundcover – a critical component of soil health – was enlarged after SLM after the SLM implemented a holistic planned grazing for the project, “with remarkable profits of up to 8% in years of higher rainfall”. SLM determined this with the help of historical ground cover data from the data analysis company Cibolabs based in Australia in order to compare the country's reaction to precipitation before and after the implementation of the grazing strategy.

In addition, the multi -year plant coverage and distribution improved, whereby the basic line values ​​exceeded in 2021 after a 6 -year -old drought, and the cattle tights rose: In 2024, the property was able to support a herd of cattle by more than 3,000 animals that were raised to natural pasture.

SLM started a carbon -oriented project at Garrawin in 2014. Since then it has issued 631,723 Australian carbon loan units, which generates an average annual net profit of more than $ 800,000 or over 500,000.

“These income has proven to be critical during the drought period,” says the report.

In holistic grazing, herd numbers must be adapted to the country's capacity. The drought reduces this capacity, and when one was hit in 2014, the stock values ​​were reduced to zero at its lowest point, says SLM. Sales of CO2 loans made part of this loss.

“As a new source for Cashflows, the carbon project in the evaluation of the wealth value over a period of 25 years was over 33%,” the report said.

“Pull out our belts” pays off “

According to lenders, other properties in the First SLM Australia Livestock Fund have similar stories that contain some difficult years that are brought by drought.

Now that the rainfall is back, these projects have become “very, very successful”, she says.

“We have seen that the tightening of our belt has paid off during the drought and that the country is now reacting well to the rain, and we have a lot of grass that enables us to stick to the real estate.”

She realizes that another carbon project that was part of the first fund ran out in 2021 with an 18% gross yield.

The Garrawin project concerns that Lender will soon try to get out of exit because the first cattle fund depends on its investment time.

The company (AUM) to be administrated grew by 24% to 755 million US dollars in 2024. As part of his impact report for this year, SLM reported 105,520 TCO₂E, which were thought about by his portfolio, which was about 23,000 cars away from the road, so to speak.

In 2025, SLM will concentrate on its Irish forest portfolio, which is supported by the European investment bank and the life of the European Commission, and continuously converted administration management uses to follow carbon for decades.

SLM estimates that this could generate carbon credits worth € 8 million (8.3 million US dollars) at today's carbon price.