Constraints to the sustainability of a ‘systematised’ approach to livestock marketing amongst smallholder cattle producers in South Africa

Commercialization of smallholder agriculture in South Africa is underpinned by reforms to improve livestock off-take in communal areas and engage smallholder farmers with formal markets. To achieve this, Custom Feeding Programmes (CFPs) were established to improve the condition of communal cattle prior to their sale into formal markets and to ‘systematise’ the informal marketing of cattle in communal areas by enabling participants to achieve higher informal market prices. We evaluate the sustainability of eight CFPs located in Eastern Cape Province in terms of their ability to add value to smallholder cattle production and encourage market participation. Communities with CFPs achieved a 16.6% mean cattle off-take rate, substantially higher than in most communal systems. Furthermore, cattle sold through CFPs attained a 17% higher mean selling price than those sold through other marketing channels. However, these benefits were mainly realized by better-off farmers with larger cattle herds and greater ability to transport animals to and from CFPs. More marginalized farmers, particularly women, had low participation. CFPs also face challenges to their sustainability, including inconsistent feed and water supplies, poor infrastructure and high staff turnover. Key to enhancing participation in CFPs, will be improving the way they are supported and embedded within communities.     

Forests or fields? A response to the theory that tropical forest conservation poses a threat to the poor

A rebuttal is provided of David Wood's proposal to open up tropical forests to agricultural uses. Concern is raised that his proposal exaggerates the ability of forests to regenerate after agricultural uses, sacrifices tropical forests in the name of alleviating poverty and in support of large land owners, and prevents valuable potential resource use by local populations. There is misunderstanding by Wood of conservationists' postures and the cause of current deforestation. In Brazil, deforestation has occurred primarily for low productivity cattle pasture (62% of all private land in the Amazon region in ranches over 1000 hectares-ha). Only 11% of private Amazonian land was in farms of less than 100 ha; only 30% of this size farm area was involved in 1991 in deforestation, while 70% of deforestation took place on ranches over 100 ha. Mass migrations of Brazil's population from the northeast to the Transamazon Highway and from Parana to Rondonia were impelled by increasing concentration of land tenure in migrant areas, and not by population growth. The rate of deforestation has slowed due to the economic recession. A World Bank study indicates that redistributing unproductive large landholdings in northeastern Brazil would increase agricultural output by 80%. The agricultural productivity of tropic areas is not as assured; Wood's support is based on preliminary findings, which are being revised with more cautionary thinking. Wood also understates the maintenance of soil fertility with fertilizers. The issue of scale also affects the use of agroforestry and perennial crop plantations such as rubber and cacao, which can only absorb the production of small areas, due to marketing constraints and physical resource limitations. Conservationists have not effectively redirected World Bank efforts to protect environments and help the impoverished, as suggested by Wood. Forest recovery has been very slow in large cattle pastures, and would take thousands of years if the land is left undisturbed. Recovery even under traditional shifting cultivation schemes is slower than Wood recognizes. Wood's argument that deforestation is temporary is not sufficient to invalidate the claim for conservation now. Reallocation is really the same as land extensification; current practices in Brazil will not support large human populations. The solution is to develop environmental services and find other means to support rural populations in urban areas.     

Sustainability dimensions related to agricultural-based development: the experience of 50 years of intensive farming in Almería (Spain)

In the context of the current agri-food market, several factors have made it increasingly difficult to balance the components of sustainability in agricultural-based development. These factors include increasing internationalization, tighter control of distribution and frequent changes in agricultural policies. Indeed, in the framework of European rural policy there has been considerable debate in recent years concerning the role of the agricultural sector and how it should face the following challenges: productivity-competitiveness, environmental protection and socio-economic development. There is, therefore, a growing need for practical analyses that adopt a holistic approach. This paper analyses how this sector in the province of Almería (Spain), based on horticultural family farms, has risen to the above issues over recent decades. This case study provides some insights into the different trade-offs and synergies between sustainability dimensions. In particular, the integration of ecological, social and economic components may prove useful in helping other regions to adapt their agricultural systems, especially where these are characterized by small-scale farming.     

The End of a Romance? A Note on the Quantitative Impacts of a ‘Brexit’ from the EU

This study suggests UK equivalent variation (EV) gains of €8.9 billion on withdrawal from the EU budget. Factoring in associated trade facilitation costs from the loss of UK access to the single market, annual UK EV losses could be as high as €14.0 billion, with the EU‐28 facing a corresponding loss of €40.4 billion. Interestingly, the extrapolated UK gain arising from withdrawal from the ‘CAP’ component of the EU budget exceeds estimated lower and upper bound trade facilitation costs exclusively on EU agrofood trade. Accordingly, the UK should realistically remain as an EU member, although continue to lobby for reductions in the CAP budget.     

Is it Possible to Utilise the Agricultural Potential of Ukraine under the Current Agrarian System?

The government of Ukraine aims to transform the country into an ‘agricultural superpower at the international level’ with the hope that the sector will gain high foreign currency earnings and become ‘the engine of national economic development’. The large agribusiness corporations have willingly responded to these calls. However, placing hope solely in the corporate sector is inadequate as the key role of agriculture to create business diversity and achieve rural social and environmental objectives will remain unfulfilled. Many other national economies have experienced ‘the offensive’ of capital on agriculture during the twentieth century, with associated negative consequences, thus encouraging them to adopt more balanced agrarian policies which benefit the whole rural population. Utilisation of Ukrainian agricultural potential as an economic growth engine requires a fundamental change in the interpretation of its purpose, which is currently focused on profit‐making export‐oriented commercial activity. The multifunctional nature of the sector needs to be emphasised, the purpose of which is not only the production of agricultural and food products, but also the creation of public benefits, such as the development opportunities and means for existence for 14 million Ukrainian rural inhabitants, maintenance of ecological balance, regeneration of soil fertility and preservation of rural landscapes.     

ASDA: Organic Growth of a Retailer in the United Kingdom?

This article analyzes the role of glocalization in Wal-Mart's venture in the United Kingdom. In 1999, Wal-Mart acquired ASDA, a British food retailer. Glocalization refers to strategies adopted by multinational corporations to cater to local tastes and differences after entering a foreign market. The authors' main argument is the following: after Wal-Mart acquired ASDA, it did not manage to successfully impose its Wal-Martization strategies because they consisted mainly of “organic growth” strategies. Organic growth is a practice whereby a corporation overpoweringly imposes its home-based blueprint of product consumption and corporate culture on foreign cultures. As demonstrated in this analysis, Wal-Mart had to drop its Bentonville-based shopping and corporate formula and, instead, adopt the principles of glocalization.     

Is a slowdown in agricultural productivity growth contributing to the rise in commodity prices?

A slowdown in the rate of agricultural productivity growth is thought by many observers to be contributing to the recent rise in agricultural prices. In this article I decompose sources of output growth in global agriculture into aggregate input and total factor productivity (TFP) components and examine whether productivity growth slowed substantially in the years leading up to the recent rise in commodity prices. Contrary to widely held perceptions, I find no evidence of a general slowdown in sector‐wide agricultural TFP, at least through 2006. If anything, the growth rate in agricultural TFP accelerated in recent decades. However, the results do show a slowdown in the growth of agricultural investment. Accelerating TFP growth largely offset decelerating input growth to keep the real output of global agriculture growing at about 2% per year since the 1960s. Regionally, however, agricultural productivity performance has been uneven. These findings have important implications for the appropriate supply‐side policy response to the current agricultural price crisis.     

Supply responses of peasant cultivators in the Sudan—a rational expectations model

Abstract

Most attempts to increase agricultural production rely on incentives to the farmer, especially regarding market prices, and a positive response by him. In this paper the latter is analysed with reference to two major oilseed export crops in the Sudan, groundnuts and sesame, under small peasant farming conditions. The methodology used to study the behaviour of farmers is based on Rational Expectations techniques and the data used are drawn from official time series material. The results obtained show that small farmers are responsive to price changes for these crops by adjusting crop areas. The implications of the results are of importance to policy makers in that peasant production can be stimulated by ensuring that the producers obtain sufficient price incentives to do so. An immediate priority is an in‐depth study of the competitiveness of the marketing system to provide adequate information on which to base remedial measures to ensure that the price mechanism transmits the appropriate signals to the farmers. A further important policy aspect is the need to change the reliance of the small peasant sector on shifting agriculture to maintain soil fertility, because of the increasing population pressure on land. In the longer term farmers should adjust to real price rises not by increasing the amount of land cultivated but by raising the productivity of their holdings in a new system of sedentary agriculture.     

Does willingness to pay increase with the number and strictness of sustainability labels?

Labels signaling sustainable product attributes are gaining importance, although uncertainty concerning the environmental, micro‐ and macroeconomic benefits of such labels persist. One of the questions still incompletely answered is whether Willingness To Pay (WTP) varies with a gradually increasing number of labels on a food product. In order to answer this question, we conducted a laboratory experiment with 191 student respondents, testing consumer valuations of different labeling strategies. Using the Becker‐DeGroot‐Marschak mechanism, WTP for 15 food products was measured. The products were endowed with up to six different sustainability labels, such that each grocery item was available in eight product versions. For perishable, nonperishable, and plant‐based products, the results indicate that participants are prone to allocating WTP‐premiums to labeled products, more than to unlabeled products. For animal products, however, labels do not influence WTP significantly. Furthermore, the premiums do not vary with an increasing number of labels, irrespective of whether the labels signal substitute or complementary sustainability information. The results are not entirely in line with normative notions of magnitude variation, but rather with the behavioral economic concept of embedding effects.     

Introduction to the Special Feature: Will the BRIC Decade Continue? The Role of Rural Areas and Agriculture

This article provides an introduction to the special feature on agriculture‐related issues in the emerging economies of Brazil, Russia, India and China (BRIC) contained in this issue of Journal of Agricultural Economics. The special feature is motivated by the increased interest which these countries have received since the turn of the millennium and by the significance of agriculture in their development. It considers economic and social development in BRICs, their integration in world agricultural trade as well as environmental concerns. This article presents key figures on economic, social and agricultural features in BRICs and compares them across countries. A synthesis of the articles included in the special feature is provided by highlighting the selection of topics likely to be crucial for further development across BRICs.     

Deregulation of the Australian Wheat Export Market: What Happened to Wheat Prices?

ABSTRACT

This report investigates whether deregulation of the Australian wheat export market induced a structural change in the price data generation process. We analyze the unit root properties of Western Australian wheat price series by testing for the possibility of single and double structural breaks. Daily spot prices for the period of May 20, 2003, to September 14, 2010 are used. We find the wheat price series has a unit root with two structural breaks but neither breaks coincides with the time when the Wheat Export Marketing Act 2008 came into effect on July 1, 2008. The implication of our results is that deregulation was not the main cause of structural breaks in the price series in the sample period.     

Crisis and relief in the Niger Delta (2012–13): assessment of the effects of a flood on relational capabilities

In September 2012, the Niger Delta (Nigeria) experienced a severe flood. By conducting a differences-in-differences estimation (as well as qualitative interviews), this paper studies the effects of the flood and of relief aid provided by an oil company on relational capability, a concept which covers bonding, bridging, and linking aspects of social capital (SC). We find that the flood increased bonding SC, measured as trust in the community, but reduced bridging SC, measured as participation together with unknown people in common-interest projects. The aid distributed to some people, on the other hand, was associated with higher bridging SC. The aid was not distributed according to flood damages but mostly according to social status. Our findings emphasize how a disaster can affect the repartition of bonding and bridging SC in the short term. They also highlight the need to build social cohesion in vulnerable communities from a longer-term and institutional perspective.     

Feeling the Effects of a Competitor’s Product Recall: Lessons Learned by Quebec SMEs in the Cheese Sector

This article explores learning opportunities and portrays the product recall as a crisis situation from which small and medium-sized enterprises (SMEs) indirectly impacted by the event can and must learn. It describes the raw milk cheese recall in Quebec. A semistructured interview guide was used. The population studied comprises 12 cheese makers specializing in processing partly or totally raw milk and presents the results of interviews with managers of companies that survived the ordeal. Excerpts from interviews show that cheese makers took advantage of this crisis to improve their capacity to manage product recalls. The comments by the producers interviewed indicate that the crisis had a marked influence on knowledge creation related to prevention and preparedness for product recalls.     

Do family farms really converge to a uniform size? The role of unobserved farm efficiency*

We analyse the growth of family farms in Israeli cooperative villages during a period of economic turmoil. We use instrumental variables to account for the endogeneity of initial farm size, and correct for selectivity as a result of farm survival. We also include a technical efficiency index, derived from the estimation of a stochastic frontier production model, as an explanatory variable. Our aim is to check whether ignoring efficiency could have been the reason for convergence results obtained elsewhere in the literature. We found that technical efficiency is an important determinant of farm growth, and that not controlling for technical efficiency could seriously bias the results. In particular, larger farms are found to grow faster over time, while without controlling for technical efficiency the farm growth process seemed to be independent of initial farm size. The increasing polarisation of farm sizes in Israel has ramifications for the inefficiencies induced by the historical quota system, for the political power of the farm sector and for the social stability of farm communities.     

Farm‐level impacts of prolonged drought: is a multiyear event more than the sum of its parts?

A multiyear discrete stochastic programming model with uncertain water supplies and inter-year crop dynamics is developed to determine: (i) whether a multiyear drought's impact can be more than the sum of its parts, and (ii) whether optimal response to 1 year of drought can increase a producer's vulnerability in subsequent years of drought. A farm system that has inter-year crop dynamics, but lacks inter-annual water storage capabilities, is used as a case study to demonstrate that dynamics unrelated to large reservoirs or groundwater can necessitate a multiyear model to estimate drought's impact. Results demonstrate the importance of analysing individual years of drought in the context of previous and future years of drought.     

Water–milk nexus in India: a path to a sustainable water future?

This paper examines the nexus between milk production and water use in India. The nexus is examined in the context of extended consumptive water use (CWU) of milk production beyond drinking water. It includes the real CWU (evapotranspiration (ETa) that occurs during the production of green fodder and feed grains) and the virtual CWU (ETa embedded in by-products for animal feed). The real CWU appears as large as that of sugarcane, and the real and virtual CWU combined is as large as that of rice. However, milk production generates more value than the outputs of rice and sugarcane combined. Sustainable water use and agricultural growth in major milk-producing areas require a drastic reduction in groundwater CWU, which, at present, exceeds natural recharge. It is suggested that diversifying to a mix of milk and high-value (but low water consuming) crops can reduce groundwater CWU while ensuring higher total output.     

An engineering economics approach to the estimation of forest fuel supply in North-Trøndelag county,Norway

The article reports a study performed in North-Trøndelag county in Norway, aiming at identifying the economic supply curve for forest fuels. Using an engineering economics approach, the potential forest fuel production is described as a function of the existing traditional forestry. Based on a set of energy raw materials including (i) harvesting residues, (ii) low-quality trees, (iii) thinnings and (iv) hardwoods, necessary adjustments of the existing forestry technology are described and used as a basis for the calculations. Depending on fuel market prices, a total annual amount of forest fuels close to 0.5 TWh is available in the county.     

Is it too late to stabilise the global climate?

Assessment of the feasibility of stabilising the global climate requires consideration of trajectories for emissions of carbon dioxide and other greenhouse gases. This study presents a simple and robust analysis of feasible emissions trajectories. Consideration of feasible trajectories suggests that if the current pace of mitigation efforts is sustained, the likely outcome will be stabilisation at concentrations close to 500 parts per million. Such an outcome will imply a higher than 50 per cent probability of substantial damage from climate change and an enhanced risk of a catastrophic outcome.     

Protester or non‐protester: a binary state? On the use (and non‐use) of latent class models to analyse protesting in economic valuation*

In the analysis of stated preferences studies, it is often assumed that protesting is a discretely measured item only occurring among those who are not willing to pay. However, various studies have recently shown that protest beliefs are as well held by respondents who state a positive willingness to pay (WTP). Using latent class (LC) models, we investigate the extent of heterogeneity with respect to protest beliefs among all respondents of two contingent valuation studies. The advantage of LC models is that classes of individuals are endogenously identified and no selection bias is introduced by ad hoc definitions of protesters. Further we investigate whether it is possible to identify a class of non‐protesters. Finding a group of pure non‐protesters could indicate how strongly stated WTP in the whole sample is affected by protest beliefs. For both samples, we find a class with strong protest beliefs but no pure non‐protest class. Overall, our results suggest that LC models might not be the first choice to determine unbiased WTP measures, but they provide valuable insights into the degree of protesting expressed by different groups and corresponding determinants of group membership.     

Soil and water conservation technologies: a buffer against production risk in the face of climate change? Insights from the Nile basin in Ethiopia

This study investigates the impact of different soil and water conservation (SWC) technologies on the variance of crop production in Ethiopia to determine the risk implications of the different technologies in different regions and rainfall zones. Given the production risks posed by climate change, such information can be used by decision makers to identify appropriate agricultural practices that act as a buffer against climate change. Results show that SWC investments perform differently in different rainfall areas and regions of Ethiopia and that the effectiveness of technologies such as irrigation, fertilizer, and improved seeds often depends on whether these investments are coupled with SWC measures. These results underscore the importance of the selection of appropriate combinations of technologies and careful geographical targeting when promoting and scaling up SWC technologies for adaptation to climate change.