Sustainable Agriculture

1
Sustainable Agriculture

• A natural part of the structural adjustment
  process ?

2
Sustainable Agriculturebalance three main goals

• Environmental health
• Economic profitability
• Socio-economic equity

3
Commodity agriculture

• Agriculture is incorporated into an global and
  corporate-controlled food system
• Driven by twin goals of productivity and
  efficiency
• Maximizing profitability by balancing 1) land 2)
  labor 3) capital and 4) management

4
Why the change

• Industrial Agriculture now creates multiple
  problems
• - threat to the environment
• - threat to natural resources
• - threat to the quality of life for
  
• farmers and rural communities
  - and the society as a hole

5
Approaches to change

• Government can regulate and set standards code
  of best practice
• Let the invisible hand of the market do the job
• Post industrial approaches people driven
  solutions

6
The Dutch Manure Quota System

• Regulation and markets to achieve
• environmental outcomes
• and
• Sustain rural communities

7
The Dutch System of Manure Quota
Over-application of manure effluent can result in
runoff and ponding of water on the soil surface.
Both activities can lead to surface and ground
water contamination. Bacteria and nitrate are
the two most dangerous pollutants in drinking
water
Impact on human health especially infants Also
reduced vitality and increase stillbirth, low
birth weight and slow weight gain in livestock
8
Holland The Environmental Problem in Animal
Agriculture

• Between the early 1960s and the mid 1980s
• Pigs increased by 10 million (450)
• Poultry increased by 50 million (125)
• Consequently, a manure surplus developed of 19
• The EU standard of 50mg of nitrate pr liter of
  groundwater was exceeded on 60 of agricultural
  land
• First warning sounded in the 1970s

9
1st Policy Action A Moratorium

• the Interim Law for Restriction of Pig and
  Poultry Farms (November 1984).
• No new farms in the worst affected areas
• Restrictions on expansions on existing farms
  (10)
• It was not enough
• the number of pigs went up with 7.5 per year
  from 1983 to 1987
• Eutrophication of surface and ground water became
  of international concern (cut nutrients into
  North Sea by 50)

10
The 3 Phase Plan

• Phase I 1987 1990
• The Manure Law (Phosphate control)
• Manure quota and book-keeping system
• The Soil Protection Act
• Application rates and timing of land application
• Phase II 1991 1994
• The Environmental Management Act
• Guidelines on ammonia and cattle farming under
  the Nuisance Act
• Phase III 1995 2000
• Markets for manure quotas established

11
Overview of the Quota System

• Manure production rights limited to 125 kg of
  phosphate per hectare
• Farmer grandfathered a reference amount
• Based on inventory of animals and standards for
  manure production for 3 animal categories
• Cattle and turkey
• Goat, sheep, fox, nutria and ducks
• Swine and poultry
• Difference between phosphate intake through feed
  and output through meat, egg etc
• Established phosphate deficit and surplus farms
• Deficit farmers could continue to expand
• Surplus farmers needed additional registered
  manure production rights for expansion

12
Trading in Manure Production Rights

• 1987 93
• transfer of manure production rights restricted
  to land transfers
• Part of transfers of whole farm
• With marriage and heritage
• With annulment of lease contract
• Expansion only by buying land
• However, If buying additional land the associated
  reference amount would first fill the gap on
  existing land.
• Expansion of animal production therefore limited
  to new farms on cropping land

13
199497 Relaxed trading

• These restrictions limited investment
• Manure production right renamed manure quotas 1)
  land based and 2) non-land based quotas
• 1) 125 kg of phosphate per ha of land
• 2) diff. between land based quota and the animal
  based reference amount
• Both 1 and 2 made animal specific
• Only non-land based quotas were tradable

14
199497 Relaxed trading

• Reference amount adjusted for improvement in feed
  quality
• The difference between reference amount and
  adjusted reference amount made non-tradable
• Quota cut by 25 when traded
• Could only trade from animal category 3) to 2) to
  1), not in reverse order restrict expansion in
  swine production

15
Trading in Manure Production Rights
16
1995 Nutrient Accounting System proposed

• In 1995 quotas for pork and poultry cut by 30 in
  response to the development of low-nutrient feed,
• 1997 further problems with swine fewer, policy
  move to reduce swine quotas by further 25 by
  2000 - farmer protest
• 1 Jan 1998 NAS and building regulation introduced
  and the 30 abandoned
• 1 Sept 1998 pork quotas reduced to reflect 90 of
  herd as part of the aim to reduce herd by 25 by
  2000
• Quota buy-out program for the swine sector

17
1998 Nutrient Accounting System

• Farmers challenged 10 reduction in court. In
  2000 the Court upheld decision but exempted the
  planned 15 reduction in 2000
• Nutrient accounting for phosphor and nitrate
• Nutrient surplus subject to a high tax to
  encourage farmers in surplus regions to truck
  manure and spread it on grain farms in deficit
  region
• Building requirements for new buildings to reduce
  ammonia emissions
• Condition for purchase of extra quota
  improvement for buildings to reduce ammonia
  emission

18
Regional Differences and Geographical
Restrictions on Trading

• Surplus manure production in excess of 125 kg of
  P2O5/ha
• Deficit less than 125 kg
• Surplus region small intensive farms
• Deficit region larger farms with little
  experience in confined livestock production
• Trade allowed within regions
• And from surplus to deficit
• In surplus regions expansion also required
  purchase of ammonium rights these only tradable
  within counties
• Reduce willingness to expand in surplus regions

19
Evaluation

• Price of quota Great variation between regions,
  animal categories and over time
• Volume of trade
• very low 1.5 of total quota the first year
• By 1997 accumulated to 8.1 and 9.5 for surplus
  and deficit regions respectively

20
Evaluation

• Reasons for low trade
• Administrative procedures buyers had to
  demonstrate adequate manure disposal plan. During
  first year 37 of plans rejected. Therefore high
  transaction costs (as much as 17 of price)
• Policy uncertainty
• Initially many had excess quotas (10-25, gave
  high numbers for reference amount calculations).
  Impact on demand and price
• Restrictions between regions and categories
  impeded trade
• The 25 retirement rule increased the willingness
  to accept

21
Evaluation

• Geographic pattern of trade
• Encouraged farmers in surplus region to sell land
  and quota and set up in deficit region
• Encouraged exit adjustment
• Environmental effectiveness
• Animal numbers and nutrients emission have been
  reduced but why and by how much?
• Especially pork farmers have not been convinced
  of the environmental benefits
• Dynamic Effects and Innovation
• Incentive to development of methods to reduce
  emission. Especially nutritional development in
  the pork industry

22
Post-industrial approaches

• Less input intensive farming methods
• Focus on value and quality
• Civic agriculture
• Organic farming
• Alternative agriculture
• Biodynamic farming
• Ecologically grown
• Local food systems
• Community supported agriculture
• The Environmentally friendly producer and
  consumer - Eco-labeling
• Shade grown coffee
• Plantation timber
• Fair Trade not Free Trade

23
Low-till or no-till
Slide from Southwestern Minnesota from
www.stolaf.edu
24
Higher Soil Organic Matter
Soil Resources

• Nutrients for crop growth
• Soil aggregation and porosity
• Stabilizes soil against erosion

Slide from Southwestern Minnesota from
www.stolaf.edu
25
Lower Soil Compaction
Soil Resources

• Enhances water infiltration
• Prevents rapid runoff and soil erosion

Slide from Southwestern Minnesota from
www.stolaf.edu
26
Higher Soil Moisture
Soil Resources

• (samples taken during grain-filling period
  Aug./Sept.)

Slide from Southwestern Minnesota from
www.stolaf.edu
27
Higher Soil Invertebrate Populations
Soil Resources

• Contribute to Nutrient Recycling
• Maintain porous soil (burrowing)
• Control crop pests

Slide from Southwestern Minnesota from
www.stolaf.edu
28
Lower Runoff Volume
Water Resources

• Porous soil structures
• Cover crops (crop rotation)
• Crop residue (no till)

increase infiltration
Slide from Southwestern Minnesota from
www.stolaf.edu
29
Lower N Loss in Runoff
Water Resources

• Crop Rotation deep roots of perennials take up
  nutrients
• No Till low erosion prevents nutrient loss

30
Lower Fossil Fuel Use
Energy Use

• Decreased fertilizer and pesticide use
• Decreased machinery and fuel use

31
Higher Corn and Soybean Yields
Economic Productivity

• Higher soil fertility
• Higher soil moisture

32
Environmentally friendly production
Shade grown coffee
33
Environmentally friendly production

• Plantations - the alternative to native forest
  logging sustainable production seal of
  approval

Forest clearing project sponsored by the
Indonesian government.
34
Fair trade not free trade FairTrade Mark
Banana from Haiti
an independent guarantee that disadvantaged
producers in the developing world are getting a
better deal
35
Civic Agriculture

• Smaller scale, locally oriented enterprises
• Direct marketing offers farmers the advantage of
• High value products organic grown, specialties
• grass fed
• free range
• Cut out of middle-level handlers
• pick-your-own, farm
  stands
• growers marked, e-mail
  orders, consumer participation in production
• Craft-style products
• Better land management practices
• Healthier soils and animals
• A community connection about food production
  

36
Trends in Direct sales

• 1992 - 86.000 farmers in US mainland reported
  direct sales
• 1997 97.000 farmers in US mainland reported
  direct sales
• 5 of all farms with sales totaling US 500
  million, but less than 1 of all agricultural
  sales

37
Demographic characteristics

• Farmers in areas in and around metropolitan areas
  can benefit
• Farmers in areas with a population of affluent,
  well-educated urban consumers
• 13 of all farms in Northeast
• 3.1 of all farms in the South
• 4 of all farms in the Midwest

38
Water in Australia-

• another example

39
Historical context

• Policy legacy resulted in over allocation of
  water and development of unsustainable land
• Mechanisms needed to
• facilitate and encourage a reallocation of
  resources to more efficient and higher valued
  producers in more sustainable locations
• provide water for ecosystems

40
Council of Australian Governments

• Following international trends in 1994 CoAG
  introduced a reform package
• Pricing
• Water entitlements
• Water Trading
• Formally recognizing the environment
• Institutional reforms
• Consultation and public education
• Part of an IGA on a National Competition
• Policy and related reforms

41
Council of Australian Governments

• 2003 review identified three shortcomings
• uncertainty over the long-term access to water
  was still hampering investment
• Current water market arrangements are preventing
  markets from reaching their full potential
• concern over the pace of securing adequate
  environmental flows and adaptive management
  systems.

42
2004 National Water Initiative

• Clear, secure and nationally-compatible
  characteristics for water access entitlements
  defined as a perpetual share of the consumptive
  pool
• a transparent, statutory-based water planning
  process defining the consumptive pool and the
  process of allocating water
• statutory provisions for environmental and other
  public benefit outcomes

43
2004 National Water Initiative

• returning currently over allocated or overused
  systems to environmentally sustainable levels of
  extraction
• progressive removal of barriers to trade in water
• assignment of risk arising from future change in
  the availability of water for consumption
• address future adjustment issues that may impact
  on water users and communities

44
The Murray Darling Basin

• 1996 Cap on water use at 93/94 level
• 2002 Living Murray process
• 2004 IGA on addressing overallocation as the
  first step to provide 500 GL for six sites
• Water Sharing Plans NWI no guidelines as to how
  to share the cost of this

45
State legislation and policy

• South Australia 1997, NSW 2000, Queensland 2000
  New Water Acts
• Separation of land and water
• Separation of ownership and use of water
• Planning processes
• Water markets
• Environmental issues
• But absolutely inconsistent across states

46
State legislation and policy

• 2004 - Victoria White Paper
• Introduce the separation of land and water max
  10 of total entitlements of source
• Share based entitlement
• Non-tradable site use licenses linked to land
• Some channels need to be closed compensation
  for loss of land value
• New tradable low security license against 20
  reduction in pool for the environment

47
State legislation and policy

• Victorian White Paper continued
• Channel capacity entitlement
• Separate capacity charge better economic
  signals
• Government committed to provide the initial water
  for environmental flow
• Promise to consider supporting communities
  suffering from export of water out of districts

48
State legislation and policy

• Generally changed allocation practice
• Transferred most risk management from water
  authorities to irrigators
• Water markets looked upon as one of the main
  instruments to alleviate impact of new policy
  paradigm by both Federal, State and Basin

49
Have markets achieved objectives

• Water moved to more efficient users
• Water moved to higher valued users
• Water consolidate into larger units

50
Conclusions

• Change in policy paradigm in Australia aggressive
  due to the extend of the impact of past policies
• Transferred most risk management to irrigators
• Reductions in entitlement inevitable in most
  catchments
• Water markets relied upon to manage this process

51
A sustainable Water Management Framework