Greenhouse gas and groundwater recharge abatement benefits of tree crops in south-western Australian farming systems

The indirect benefits of a commercial tree crop for greenhouse gas and groundwater recharge abatement are analysed. Oil mallees are introduced into a whole-farm linear programming model as a source of income, an offset to greenhouse gas emissions from the mixed sheep and cropping enterprises and as a source of groundwater recharge abatement. The profitability of oil mallees is found to be very sensitive to the discount rate, yield and price assumptions and the relative profitability of other farm enterprises (especially the wool enterprise). Under standard assumptions where oil mallees are profitable, the trees significantly reduced greenhouse gas emissions and groundwater recharge and the farm remains profitable. If farm-level policies are introduced for greenhouse gas abatement, without tree crops or some other technological change, the current farming systems would fail and be replaced by alternative land uses.     

Agriculture's Likely Role in Meeting Canada's Kyoto Commitments*

Voluntary adoption of beneficial management practices will be the primary means by which farmers cut net greenhouse gas (GHG) emissions. The offset system will not be a major driver due to (a) the relatively low prices likely to be offered by large final emitters facing an emission cap, (b) discounts applied to those prices for temporary sequestration, (c) the transaction costs and risk premiums associated with signing carbon contracts, and (d) the low elasticity of supply of CO₂ abatement. Although Canadian farmers are likely to participate to only a limited extent in the carbon‐offset market, many will find it profitable to adopt one or more of the BMPs for reducing net GHG emissions. Canadian agriculture is likely to contribute significantly to net emission reductions by voluntarily sequestering carbon due to the adoption of zero till in the last decade, and possibly by cutting fertilizer levels in the next decade. The contribution will be mainly a response to meeting personal economic objectives rather than being induced by direct incentives through the offset program.     

A grassland strategy for farming systems in Europe to mitigate GHG emissions—An integrated spatially differentiated modelling approach

This paper assesses the impact of an EU-wide policy to expand grassland areas and promote carbon sequestration in soils. We use the economic Common Agricultural Policy Regionalized Impact (CAPRI) model, which represents EU agriculture using 2450 mathematical programming farm-type models in combination with the biogeochemistry CENTURY model, which provides carbon sequestration rates at a high resolution level. Both models are linked at the NUTS3 level using location information from the Farm Accounting Data Network. We simulated a flexible grassland premium such that farmers voluntary and cost efficiently increase grassland area by 5%. We find that the GHG mitigation potential and the costs depend on carbon sequestration rates, land markets and induced land use changes, and regional agricultural production structures. In Europe, the calculated net effect of converting 2.9 Mha into grassland is a reduction of 4.3 Mt CO2e (equivalents). The premium amounts to an average of EUR 238/ha, with a total cost of EUR 417 million for the whole EU. The net abatement costs are based on the premium payments, and account on average EUR 97/t CO2e. However, substantial carbon sequestration (28% of total sequestration) can be achieved at a rate of EUR 50/t CO2e. Carbon sequestration would be most effective in regions of France and Italy and in Spain, the Netherlands and Germany. Larger farms and farm-types specialized in ‘cereals and protein crops’, ‘mixed field cropping’ and ‘mixed crop-livestock’ farming systems have the highest mitigation potential at relatively low costs.     

Smallholder farms’ adaptation to the impacts of climate change: Evidence from China’s Loess Plateau

The impacts of climate change on agriculture in developing countries will depend on the extent to which agricultural production in those regions adapts to climate change’s influences. This study uses a whole-farm land use optimisation approach to explore climate change impacts, when including adaptation, on farm profitability, production and associated greenhouse gas (GHG) emissions in the Loess Plateau of northern China. The results show that with adaptation activities, the losses in smallholder farm profitability caused by the climate change could be moderate. Declining rainfall results in land use changes that generate higher on-farm GHG emissions with the most economically beneficial adaptations. With 5 % or 10 % decline in annual rainfall, the introduction of agricultural carbon tax would generate substantial reduction in on-farm GHG emissions. With 30 % rainfall reduction, agricultural carbon tax is not likely to bring about considerable emission reduction. The economically optimised land uses are generally sensitive to potential changes. When rainfall reductions appear, there is a clear trend toward reducing cropping area and transiting to pasture. With 5–10% rainfall reductions, increasing agricultural carbon tax with same rainfall reduction leads to the expansion in cropping enterprises. However, with 30 % rainfall reduction, land allocations are not sensitive to agricultural carbon tax. When with declining annual rainfall, in the optimal enterprises more oats-pasture rotations are employed to reduce wheat dominated rotations. Besides land use patterns, adaptations through altering farm management practices are also necessary. The economically optimised sheep flock would be increased considerably with declining rainfall. Overall, policymakers are suggested to initial more educational schemes to tell smallholder farmers how to make the best use of available adaptation strategies and consider changes in climate when design and implement agricultural policy.     

Economic Risk and Water Quality Protection in Agriculture

Producers' and consumers' risk perceptions and preferences can affect perceived costs and benefits of agricultural water quality protection. Many studies find that integrated pest management actually reduces economic risks to farmers. Results from crop rotation and conservation tillage studies are mixed, while nutrient management studies indicate a potential for higher risk compared with conventional practices. Uncertainty about pollution damages to water resources is likely also to increase the perceived benefits of a given quantity of water quality protection practices. Public policies to reduce uncertainty about the costs and benefits of water quality protection practices may produce net social benefits.     

Does carbon farming provide a cost‐effective option to mitigate GHG emissions? Evidence from China

In this study, we apply a whole farm bioeconomic analysis to explore the changes in land use, farm practices and on‐farm greenhouse gas (GHG) emission under varying levels of agricultural greenhouse gas abatement incentives in the form of a carbon tax for a semi‐arid crop‐livestock farming system in China's Loess Plateau. Our results show that the optimised agricultural enterprises move towards being cropping‐dominated reducing on‐farm emission since livestock perform is the major source of emission. Farmers employ less oats‐based and rapeseed‐based rotations but more dry pea‐based rotations in the optimal enterprise mix. A substantial reduction in on‐farm greenhouse gas emission can be achieved at low cost with a small increase in carbon incentives. Our estimates indicate that crop‐livestock farmers in China's Loess Plateau may reduce their on‐farm GHG emission between 16.6 and 33 per cent with marginal abatement costs <￥100/t CO₂e and ￥150/t CO₂e in 2015 Chinese Yuan. The analysis implies that reducing greenhouse gas emission in China's semi‐arid crop‐livestock agriculture is potentially a low‐cost option.     

Testing the Empirical Relationship between Best Management Practice Adoption and Farm Profitability

Several "best management practices" (BMPs) aimed at reducing movement of nutrients, pesticides, and sediment into surface water resources have been developed and promoted by Extension and other agencies over the past several years. This study utilizes actual farm-level economic and BMP adoption data to rigorously analyze the relationship between BMP use and farm profitability. Results indicate that adoption of nutrient BMPs has a significant positive effect on net farm income (NFI) for wheat and corn, while herbicide BMP adoption, particularly use of BMPs related to the application of atrazine on corn, has a small (but statistically significant) negative impact on income. Adoption of soil conservation BMPs is not shown to have a statistically significant impact on farm income.     

Spatial Targeting of Conservation Tillage to Improve Water Quality and Carbon Retention Benefits

This paper develops a GIS-based modeling framework that integrates a farm model, a hydrologic model, and a soil organic matter model to examine spatial targeting of conservation tillage to jointly improve water quality and carbon retention benefits in agricultural watersheds. Previous studies have examined the targeting of conservation tillage, land retirement, and riparian buffers at watershed scale to achieve water quality benefits but not considered carbon retention benefits. An empirical application of the framework in the Fairchild Creek watershed in Ontario shows that targeting conservation tillage based on sediment abatement goal can also achieve comparable carbon retention benefits in terms of percentage reduction of its base carbon losses. The targeted subcatchments for conservation tillage vary across the watershed based on benefit to cost ratios. The pattern of conservation tillage targeted based on carbon retention goal is similar to that with a sediment abatement goal but slight differences are found because of different carbon content in the soils. The modeling results have important policy implications for the design of conservation stewardship programs such as setting sediment abatement goal as an indicator to achieve joint environmental benefits and direct public fund to locations that can achieve environmental goals at least costs.     

Factors influencing adoption of conservation tillage in Australian cropping regions*

The purpose of this research is to improve understanding of conservation tillage adoption decisions by identifying key biophysical and socio‐economic factors influencing no‐till adoption by grain growers across four Australian cropping regions. The study is based on interviews with 384 grain growers using a questionnaire aimed at eliciting perceptions relating to a range of possible long‐ and short‐term agronomic interactions associated with the relative economic advantage of shifting to a no‐tillage cropping system. Together with other farm and farmer‐specific variables, a dichotomous logistic regression analysis was used to identify opportunities for research and extension to facilitate more rapid adoption decisions. The broader systems approach to considering conservation tillage adoption identified important determinants of adoption not associated with soil conservation and erosion prevention benefits. Most growers recognised the erosion‐reducing benefits of no‐till but it was not an important factor in explaining whether a grower was an adopter or non‐adopter. Perceptions associated with shorter‐term crop production benefits under no‐till, such as the relative effectiveness of pre‐emergent herbicides and the ability to sow crops earlier on less rainfall were influential. Employment of a consultant and increased attendance of cropping extension activities were strongly associated with no‐till adoption, confirming the information and learning‐intensive nature of adopting no‐till cropping systems.     

THE ANALYSIS OF NET FARM INCOME: AN EXAMINATION OF FARM MANAGEMENT SURVEY DATA

The practical significance of the conventional “net farm income” is elusive. It would be useful to have an accepted method of dividing “management and investment income” into its recognised Components—managerial salary and return on tenant's capital. One is a residual if the other can be calculated, and both alternatives are considered. An empirical formula is suggested for estimating the managerial salary which may be imputed to the farmer, taking account of his total turnover, his labour bill and his net farm income. This formula is then applied to Farm Management Survey data, for individual farms and for groups of average, high and low performance (output per £ input). The method may permit closer analysis of relative profitability.     

Profitability and opportunity of conservation agriculture in acid savannah grasslands of Laos

In north-eastern Laos, the savannah grasslands of the Plain of Jars cover vast areas of potentially cultivable land. However, soil acidity, low inherent fertility, and the absence of alternatives to tillage represent significant constraints to the development of sustainable smallholder agriculture. Our objective was to evaluate the potential for conservation agriculture (CA) to enhance soil productivity and farming system profitability. A three-year rotation of rice/maize/soybean was tested under three fertilization levels and four agricultural systems: one conventional tillage-based (CT) system and three CA systems based on no-tillage with cover crops. After four cropping seasons, our results show that, compared with CT, CA systems led to similar-to-higher grain production, similar-to-higher profits, higher opportunity of livestock system intensification, and higher labour productivity regardless of fertilization levels. While CA represents a relevant alternative to current practices, our results suggest that its contribution to the emergence of a sustainable smallholder agriculture is conditioned by broader institutional transformations, including the enrolment of local manufacturers and traders for deploying no-till implements and seed market channels for cover crops, long-term public support to maintain active research and technical mentoring to farmers, and possibly the integration of ecosystem services in agricultural policy.     

Cost-effective nitrogen leaching reduction as influenced by linkages between farm-level decisions

This article focuses on how the linkages between various farm‐level decisions affect the choice of measures to reduce nitrogen leaching from crop production. A mathematical programming model is developed. The model considers not only management decisions that affect nitrogen leaching directly, but also other decision variables such as scheduling of field operations and machinery investments. A simplified analysis that ignores the latter management decisions, and the linkages between the various decisions, may result in abatement policies that are not cost‐effective because the policies will have other effects than expected. As an example, the empirical results show that subsidies to catch crops and spring ploughing may contribute to increased nitrogen load, quite contrary to the purpose of these subsidies. Further, it is noted that the characteristics of the production system make it costly to change land use, tillage practices, or fertilizer use drastically. Instead, cost‐effective nitrogen abatement includes a mix of various adjustments of farm‐level production practices. The EU set‐aside payment appears to reduce abatement costs.     

Risks and returns from soil conservation: evidence from low-income farms in the Philippines

This paper examines risks and returns associated with soil conservation on hillside farms in the Philippines. Stochastic efficiency analysis is combined with a heteroskedastic regression model to assess the impacts of contour hedgerows on low-income corn farms. Regression analysis indicates that, over time, contour hedgerows can improve yields up to 15% compared with conventional practices. The analysis also provides weak support tor a hypothesis that hedgerows are variance reducing. However, results show that the reduction in yield variability afforded by hedgerows is modest, and that yield variability may increase by as much as 5% as hedgerow intensity rises. Tests for stochastic dominance show that, compared with the conventional tillage system, hedgerows do not constitute an unambiguously dominant production strategy. Stochastic elticiency with respect to a function is used to identify a range lor the coefficient ol relative risk aversion within which hedgerows dominate conventional tillage. Results suggest this range would be rather high; hedgerows dominate the conventional cropping strategy only lor decision-makers with relative risk aversion coefficients in the range 3-5.5. Implications for soil conservation adoption in low-income settings are discussed.     

Feasibility of conservation agriculture in the Amu Darya River Lowlands,Central Asia

Human-driven land degradation threatens economic and environmental sustainability of irrigated agricultural production such as in Central Asia. Many current challenges can be eased by implementing Conservation Agriculture (CA), with however unknown financial consequences under the predominating irrigated conditions. We applied the linear programming to compare costs and benefits of four CA production systems, which are cotton-based rotation systems including (i) cotton-cotton and (ii) cotton-wheat-maize rotations under conventional tillage (CT), as well as (iii) cotton-cover crop-cotton, and (iv) cotton-wheat-maize rotations with mulch cover (crop residue retaining) and both rotations under permanent-bed planting (PB) with minimum tillage. All systems were subjected to six levels of land quality and a series of crop pricing schemes. Data were extracted from empirical research on CA in Uzbekistan, complemented with data on input and output prices from surveys. The findings underpinned the financial advantages of more diversified cropping systems (cotton-wheat-maize) over the crop monoculture (cotton-cotton-based system). Crop cultivation on marginal land was unprofitable under CT. In contrast, crop production under PB could generate profits even on croplands with a lower productivity level considered. It is argued that PB with crop residue retaining and applied in cotton-wheat-maize rotation shows most promise for improving crop yields and income.     

Small U.S. dairy farms: can they compete?

The U.S. dairy industry is undergoing rapid structural change, evolving from a structure including many small farmers in the Upper Midwest and Northeast to one that includes very large farms in new production regions. Small farms are struggling to retain competitiveness via improved management and low‐input systems. Using data from USDA's Agricultural Resource Management Survey, we determine the extent of U.S. conventional and pasture‐based milk production during 2003–2007, and estimate net returns, scale efficiency, and technical efficiency associated with the systems across different operation sizes. We compare the financial performance of small conventional and pasture‐based producers with one another and with large‐scale producers. A stochastic production frontier is used to analyze performance over the period for conventional and pasture technologies identified using a binomial logit model. Large conventional farms generally outperformed smaller farms using most economic measures—technical efficiency, various profitability measures, and returns to scale.     

Cost-effective Targeting of Riparian Buffers

This paper develops an integrated economic, hydrologic and GIS modeling framework to examine the cost-effective targeting of land retirement for establishing riparian buffers in agricultural watersheds. Previous studies have examined the efficiency of targeting large land parcels for retirement or targeting management practices such as conservation tillage but have not considered narrow variable buffer strips. An empirical application of the framework in the Canagagigue Creek watershed in Ontario shows that average and marginal costs of sediment abatement increase at an increasing rate as the environmental goal becomes more stringent. The locations of the buffer strips vary across the watershed and are not necessarily located on those sites with greatest slope or those adjacent to visible streams. Cost effectiveness is further increased if the targeting is extended to allow for the width of the buffer strip to vary by location rather than assume a uniform width. The modeling results have important policy implications for the design of conservation stewardship programs such as setting appropriate environmental health goals based on marginal abatement costs relative to marginal benefits, and setting physical characteristics of the riparian buffers for selection along the drainage network in targeted sub-catchments.     

Climate change reduces the mitigation obtainable from sequestration in an Australian farming system

Agricultural research on climate change generally follows two themes: (i) impact and adaptation or (ii) mitigation and emissions. Despite both being simultaneously relevant to future agricultural systems, the two are usually studied separately. By contrast, this study jointly compares the potential impacts of climate change and the effects of mitigation policy on farming systems in the central region of Western Australia’s grainbelt, using the results of several biophysical models integrated into a whole‐farm bioeconomic model. In particular, we focus on the potential for interactions between climate impacts and mitigation activities. Results suggest that, in the study area, farm profitability is much more sensitive to changes in climate than to a mitigation policy involving a carbon price on agricultural emissions. Climate change reduces the profitability of agricultural production and, as a result, reduces the opportunity cost of reforesting land for carbon sequestration. Nonetheless, the financial attractiveness of reforestation does not necessarily improve because climate change also reduces tree growth and, therefore, the income from sequestration. Consequently, at least for the study area, climate change has the potential to reduce the amount of abatement obtainable from sequestration – a result potentially relevant to the debate about the desirability of sequestration as a mitigation option.     

What carbon farming activities are farmers likely to adopt? A best–worst scaling survey

Transferring carbon from the atmosphere into terrestrial sinks through carbon sequestration practices (so-called ‘carbon farming’) has been proposed as an important component in Australia’s efforts to mitigate greenhouse gas emissions. We use a Best–worst scaling survey to determine which carbon sequestration practices farmers would be most and least likely to adopt, and what factors were most important in any potential adoption decision. The survey was distributed to dryland cropping and mixed crop-livestock farmers in Western Australia. Farmers ranked improved soil quality and reduced soil erosion as the most important potential co-benefits of carbon farming. Factors discouraging farmers from participating in carbon farming contracts were policy and carbon price uncertainty and the uncertain impact of carbon farming practices on productivity and profitability. Farmers had strong preferences for stubble retention and no-till cropping practices as carbon farming strategies. The practices that farmers preferred least were applying biochar and planting trees. Farm and farmer characteristics, including (lack of) awareness of carbon farming policies and opinions about climate change, influence the potential willingness to adopt different carbon farming practices. Given recent policy uncertainty and farmer preferences revealed in this study, it is important to communicate potential co-benefits (rather than opportunities to earn compensation or carbon credits) to increase farmers’ engagement in carbon sequestration activities.     

Do Farmers and the Environment Benefit from Adopting Integrated Pest Management Practices? Evidence from Kenya

We estimate the impacts of a bundle of integrated pest management (IPM) practices on mango yield, mango net income, insecticide use, human health and the environment, using recent household survey data of mango growers in Kenya. We employ a multinomial endogenous switching treatment regression model with an ordered probit selection rule to establish counterfactual outcomes. Our results indicate that IPM‐adopting farmers have higher mango yields and mango net income, and also use lower quantities of insecticide and cause less damage to the environment and to human health. In addition, switching from one IPM to multiple IPM practices generates greater economic, environmental and human health benefits. These results suggest intensification of IPM‐adoption efforts and encouragement of the use of multiple IPM practices. These positive outcomes could be achieved through greater provision of technical support and extension services to farmers.     

Soil,water and crop management alternatives in rainfed agriculture in the Sahel: an economic analysis

Most agriculture in the Sahel Region is carried out under rainfed conditions where low and uncertain soil moisture levels limit productivity. Improved soil, water and crop management practices are required to reverse the steady decline in per capita food production and sustain output over the long term. Several technological innovations and related farm management practices are evaluated in a case study of a typical farm in Mali. Through use of a soil-water balance model and a whole-farm economic model an optimal mix of these measures is identified. Compared to a base case where no modern inputs are utilized, the combination of animal traction (oxen team), low levels of NPK fertilizer, tied-ridges, traditional long-season food grain crops and early planting was most effective: food grain output was 35% higher than with the traditional base case; soil erosion was reduced by 72%; and even with residual future soil erosion damage capitalized into current income, net farm income was larger by a factor of almost 45.