Carbon removal is moving beyond pilot projects. A new agreement between JPMorgan Chase and Charm Industrial shows how the sector is entering a new phase. The deal combines carbon removal credit purchases with financing support, helping expand future supply while reducing project risk.
Under the agreement, JPMorgan will purchase 61,500 metric tons of carbon removal credits from Charm Industrial. The bank will also provide financing support to help the company grow its operations.
The deal highlights a broader trend. Large financial institutions are starting to view carbon removal not only as a climate tool but also as a market with long-term growth potential.
As net-zero deadlines approach, demand for high-quality carbon removal credits is rising. Companies are looking for solutions that deliver measurable climate benefits and long-term carbon storage.
Taylor Wright, Head of Operational Sustainability at JPMorganChase, remarked:
“Our initial purchase with Charm marked an important step as we expanded our ambition in carbon removal and refined how we assess quality and deliver real impact across our portfolio. This new purchase—bringing our total to 90,000 tons—together with financial support from our business, reflects how our portfolio has matured over time and Charm’s track record of delivering measurable, durable outcomes across its projects.”
Carbon Removal Becomes a Bigger Part of Net Zero
Carbon dioxide removal (CDR) is different from traditional carbon offsets. Many offsets focus on avoiding emissions. Carbon removal takes carbon dioxide out of the atmosphere and stores it for the long term.
Most climate experts agree that emissions cuts alone will not be enough to meet global climate goals. According to the Intergovernmental Panel on Climate Change (IPCC), most pathways that limit warming to 1.5°C require large-scale carbon removal.
Today, the novel technological market remains small. Global demand for these engineered carbon removals is still below 10 million metric tons per year, according to CDR.fyi.
However, the State of Carbon Dioxide Removal Report shows that total global removals—mostly from forestry—already sit at 2.2 billion tons. Looking forward, IPCC climate pathways project that total global demand will need to reach billions of tons annually by mid-century to meet net-zero targets.
That growth is expected to come from sectors such as aviation, steel, cement, and shipping. These industries are difficult to fully decarbonize and will likely need carbon removal to address remaining emissions. Thus, investors and financial institutions are paying closer attention to the sector.
Inside JPMorgan’s Growing Climate Strategy
The agreement also fits JPMorgan’s broader climate strategy. The bank has committed to aligning key parts of its financing portfolio with net-zero emissions by 2050. It has also set emissions reduction targets across sectors including power generation, oil and gas, aviation, shipping, and automotive manufacturing.
In addition, JPMorgan has pledged to finance and facilitate more than $2.5 trillion toward sustainable development initiatives by 2030. That includes $1 trillion dedicated to climate action and green solutions. Carbon removal is becoming an important part of those efforts.
Many companies can reduce most of their emissions through clean energy, efficiency improvements, and new technologies. However, some emissions are likely to remain. Carbon removal is expected to help address these residual emissions.
The structure of the JPMorgan-Charm deal is also notable. Instead of only purchasing carbon credits, the bank is helping support future production capacity. This approach gives developers access to capital while helping buyers secure future carbon removal supply.
Peter Reinhardt, CEO and Co-Founder of Charm Industrial, stated:
“JPMorganChase is helping build the infrastructure for a permanent carbon removal industry. Having a sophisticated, mission-aligned financial institution come back for a second, larger purchase while also stepping up with growth capital is exactly the kind of validation that tells us we’re on the right path.”
Charm’s Way: Turning Farm Waste Into Permanent Carbon Storage
Charm Industrial uses a process known as biomass carbon removal and storage. The company collects agricultural waste, including crop residues that would otherwise decompose or be burned. It converts this material into a carbon-rich bio-oil through a process called fast pyrolysis.
The bio-oil is then injected deep underground for long-term storage. This method is designed to keep carbon locked away for hundreds or even thousands of years.
One advantage is that the process can use existing energy infrastructure. Storage wells, transportation systems, and other equipment already used in the energy sector can often be adapted for carbon storage.
Charm has become one of the leading companies in the sector. The company says it has already delivered more than 150,000 metric tons of carbon removal to customers, making it one of the world’s largest suppliers of durable carbon removal credits.
While the technology continues to develop, many experts see biomass carbon removal as one of the more mature engineered carbon removal pathways available today.
The Carbon Removal Supply Crunch Is Emerging
Corporate demand for carbon removal continues to increase. Technology companies have been among the biggest buyers. Many have net-zero goals and are looking for ways to address emissions that cannot be eliminated through renewable energy or operational improvements.
Programs such as Frontier have also helped accelerate the market. The initiative, backed by major technology companies, commits funding to help scale carbon removal technologies.
Yet, supply remains limited. Novel or engineered solutions contribute only 0.1%, roughly 2.2 million metric tons, to the physical supply.
Analysts at McKinsey estimate global demand for carbon removals could reach 100 million metric tons per year by 2030 and grow 100-fold by 2050. Current delivery volumes are only a small fraction of that level. CDR.fyi data shows only 1.5 million metric tons were delievered as of June 2026.
This gap between supply and demand is pushing buyers to sign long-term agreements years before credits are delivered. That trend is creating new opportunities for financing and investment.
Why Capital Could Unlock the Next Wave of Growth
One of the most important aspects of the JPMorgan-Charm agreement is the financing component.
Carbon removal projects often need large upfront investments. Companies must build infrastructure, secure storage sites, and establish monitoring systems before generating significant revenue.
New financing models are helping address this challenge. These include:
- Long-term carbon removal purchase agreements,
- Advance market commitments,
- Project financing backed by future credit deliveries, and
- Blended finance structures that combine different sources of capital.
The approach resembles the early growth of renewable energy. Long-term power purchase agreements helped wind and solar developers secure financing and expand rapidly.
Many industry observers believe carbon removal could follow a similar path. The involvement of a major institution like JPMorgan suggests the market is beginning to mature.
From Climate Niche to Investable Market
The JPMorgan-Charm Industrial agreement shows how climate finance is evolving. Companies are no longer focused only on buying carbon credits. Increasingly, they are investing in the systems needed to produce those credits at scale.
Most net-zero pathways still require large amounts of carbon removal to balance emissions from hard-to-abate industries. The challenge now is building enough capacity to meet future demand.
Technology is advancing. Corporate demand is growing. Financing is becoming more available. Together, these trends are helping move carbon removal from a niche climate solution toward a larger and more established market.
The post JPMorgan Backs Carbon Removal Growth With New Charm Industrial Deal appeared first on Carbon Credits.
Most businesses that decide to act on their net-zero targets reach the same point of friction. Buying carbon credits has meant tracking down brokers, sitting through sales calls, and requesting a quote just to learn a price, sometimes with limited proof of what you are buying.
The earnings calls that quietly reframed climate from sustainability question to operating risk.
Three earnings calls in the last 18 months tell the story without any help from a press release.
Hershey, May 2024: cocoa price exposure compresses margin, and the company attributes part of the cost shock to West African weather. Olam, July 2024: coffee climate exposure quantified in the annual report. JBS, January 2025: supply chain climate disclosures expanded materially in response to investor pressure and regulatory expectation. None of these companies issued the announcement as climate news. They issued it as financial news. The climate-linked supply chain risk did not arrive with a sustainability framing; it arrived as a P&L line.
You are probably reading this article because you suspect the same thing is happening to your business. This piece walks through what is showing up on which earnings calls, how procurement and finance leaders are quantifying the exposure, and what serious corporates are doing about it before the regulator asks.
Where climate risk has already appeared in earnings
The pattern is consistent across resource-intensive sectors. A weather event compresses supply, the price spikes, the cost flows through the income statement, and the analyst on the call asks whether the event is anomalous or structural. Increasingly, the honest answer is the second one.
Cocoa is the cleanest example. The 2023 to 2024 West African harvest fell sharply on the back of erratic rainfall and disease. Cocoa futures more than tripled. Companies with concentrated West African sourcing absorbed the cost; companies with diversified sourcing absorbed less. The exposure was not climate as ESG topic. It was climate as cost of goods.
Coffee follows the same pattern. Brazilian and Vietnamese harvests have moved on weather more sharply across the last several seasons. Roasters with long-tenor supplier relationships and origin diversification have managed the volatility; roasters with spot-market exposure have not. Wheat, sugar, palm oil, beef: the same dynamic in different commodities, a pattern the IPCC AR6 Working Group II report projects will intensify across agricultural systems through mid-century.
What this means: climate risk is no longer a footnote in the 10-K. It is a line item the CFO has to explain on the call.
The three commodity exposures that hit margin first
For most companies with material Scope 3 exposure, three exposures dominate the near-term P&L risk.
- Concentrated single-origin sourcing in a climate-vulnerable region. If your tier-one supply for any material commodity sits in one geography, you have a concentration risk that climate amplifies. Diversification across origins is the obvious hedge, but it takes years to build and requires relationships you cannot acquire by tender.
- Supplier financial fragility under climate stress. Smallholder farmers, who supply a large share of the global cocoa, coffee, and palm oil market, do not carry the balance sheets to absorb yield shocks. When yields collapse, they exit. When they exit, your supply base shrinks, and the surviving suppliers raise prices. The risk is structural, not cyclical.
- Logistics and storage exposure to extreme weather. Hurricane disruptions to Gulf shipping, drought-driven Panama Canal restrictions, flooding in European inland waterways: each of these has moved input costs in the last three years, a pattern documented in Munich Re’s natural catastrophe data. The exposure shows up as a one-quarter event in the financial press but accumulates over time on the cost line.
TCFD and ISSB disclosure changes
The disclosure architecture has now caught up with the risk. The Task Force on Climate-related Financial Disclosures, whose recommendations are now embedded in the ISSB’s IFRS S2 climate standard, requires companies to disclose climate-related risks across physical and transition categories, with quantification where possible.
For physical risk specifically (the climate-linked supply chain risk you are reading about), the disclosure must address both acute exposures (extreme weather events) and chronic exposures (gradual changes in temperature, precipitation, and growing seasons). The disclosure must address the time horizon over which the risk is material, the parts of the value chain exposed, and the financial impact under different scenarios.
The CSRD imposes similar requirements under European law, with double materiality (both financial and impact materiality) embedded in the assessment. The practical effect: your auditors and your investor relations team now need a defensible answer to the climate-linked supply chain risk question, and the answer needs to be quantified.
What procurement and finance can do now
Three actions matter near-term.
Map your exposure. Most companies do not have a clear view of which tier-one and tier-two suppliers sit in which climate-vulnerable geographies. Without the map, you cannot quantify the risk, and without the quantification, you cannot disclose it credibly. The map is the foundation, and World Resources Institute climate risk research provides useful public tooling to start.
Diversify and deepen, in that order. Diversification across origins reduces concentration risk, but the deeper move is to invest in the resilience of the suppliers you already have. Regenerative practices, agroforestry, soil health interventions: these reduce yield volatility under climate stress and protect your input cost trajectory.
Embed the climate spend inside procurement, not outside it. Treating climate risk as a sustainability cost line subordinates it to the ESG budget. Treating it as a procurement and resilience investment puts it in the budget that matters, which is the cost-of-goods budget that the CFO defends quarterly.
Nature-based supply chain investments are the asset class designed for exactly this purpose. They sit inside the value chain, they reduce climate-linked supply risk, they generate verifiable Scope 3 reductions, and they produce the documentation an auditor and a regulator can both test.
If you are quantifying climate-linked supply chain risk in advance of the next earnings cycle or the next disclosure period, the carbon and sustainability experts at Carbon Credit Capital can help you map your exposure and structure a Dual-Value Model response that addresses reduction, resilience, and disclosure-readiness in a single program. Schedule a consultation.
More and more small and medium-sized businesses are hearing the same question from their larger customers: What is your carbon footprint? That question now travels down entire supply chains, and it arrives next to tender requirements, certification criteria, and rising customer expectations.
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