Posts Tagged ‘Economy’

Stagnating yields?

April 13, 2013

Maybe. In several countries the yield trends have flattened. The raising yields from the 1990s are history. It should not be so. Plant breeding has made progress. There is scope for increase. So – why this development?

In Sweden we have started a project to find out the reasons for this lack of development ant if possible suggest improvements. Several reasons are discussed: soil structure, soil compaction, declining organic matter, lack of good break crops, more stress on reducing costs than increase income, neglected drainage …..

The experiments on farmers fields show a better development, 2-3 tons or so above the statistical yields for winter wheat. 11-12 tons is not uncommon. So there is scope. It may be so that our shorter vegetation season compared to teh Continent to some extent is compensated by longer summer days and cooler weather reducing respriration losses.

Are higher yields important? At least 3 reasons can be put forward:

Global food requirement. Land is a scarce resource. Raising demands must be met to a great extent by higher yields.

High yields are essential for the competitiveness of Swedish agriculture.

High yields are advantageous for the soil and the environment, provided inputs etc are correctly adapted

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Jobs, resources, competition, agricultural development

January 9, 2013

Some questions for 2013 and beyond.

Society function. Increasing number of jobless around the world. There should be a vision about the functioning of a society. How to find tasks for everybody? Is it possible in the industrial world of today? Some example or scenario to show. Just to create jobs nationally by competitive strength is not helping the whole. A world model for a supercomputer?

Resources help – but is it enough for creating jobs and welfare for all?  Norway has both resources and good will. Ranks high – but problems persist.

The paradox of competition. Competition is behind all our development. It is called evolution. It is hard to see alternatives. Totalitarian command? Existing examples are frightening. But unrestricted competition leads to unsustainable exploitation at least in the “green sector”. Restrictions and a framework for the competition is needed. And we have that – partially.

Research and development. In the green sector the result seldom is products which can be patented and exported, with the exeption of chemicals and technology (outside the green production sector). New knowledge may lead to more efficient production, but the technology will be spread and gives no competitive advantage. A more efficient production will ultimately through competition  lead to lower consumer prices and will only slightly benefit the production sector. So – agricultural R&D should be financed by the society.

This may sound pessimistic, but a realistic background is a good base for optimism. We need development. And there are important niches of motivation:

For the individual farmer increased and more efficient production is important

Many farmers have a motivation for soil fertility, sustainability and environment.

An exciting year – Sustainable Intensification in practice

January 3, 2013

Today I have been out controling and mending fences. 4 horses are about to arrive. Nice day, 8 degrees, also a January winter day. There are some possibilities for grazing, although the main thing is to provide space and exercise.

Sustainable Intensification – big words from important organizations. Nevertheless, for anything to happen we have to rely on the farmers. Can we get response?  (An English translation of  Framtidsodling will come shortly).

But there is a discussion. “Intensification” is an ugly word for some people. “More “industrial agriculture”, is that the way? It should be smallscale and organic. We don´t need more production really, we could waste less and distribute better to those wanting”. However,we need both ways. With the current economical paradigm, economic efficiency through competition, we will continue developing the so called “industrial agriculture”.  What we can do is to include the factors  “sustainability” and “environment”

 

Matens pris (The price of food) a book

December 16, 2012

Matens pris (The price of food) a book by  Malin Olofsson och Daniel Öhman. Reporto 2011.

Two well informed and ambitious journalists make a journey round the world: Fish farms in Vietnam, soybean in Brazil, pigs and poultry in Europe, greenhouse vegetables in The Netherlands.

The main conclusion is the same as in my book (Mat, klimat , miljö): The global market of today can not consider environmental aspects if this has a cost. The economy, costs and prices, is driving.

In the food chain the primary producer will always be squeezed. He cannot pass the costs.

This is a major problem for our world. Much could be done by international guidelines giving more priority to environment and sustainability than price competition. But there are political obstacles.

In the book it is hoped that small scale production and organic farming can help the world. Sure, they have a role to play, but, as is stated in the book, in spite of all efforts to promote organic products their market share is only 4%. The world has large and growing cities needing food, and for that more production is needed, not less. (But of course better food management can help somewhat).

But the usual popular ideas are aired:

“Nitrogen fertilizer costs energy” (but the fact that 5-10 times more solar energy is captured is neglected)

“Organic production is climate smart” (per hectare, yes, but the lower production changes the picture and the total sum can be plus or minus).

In these issues the critical journalistic ambition takes a holiday,

My own reflection:

There is a way or at least a path to pursue: help the farmers to find better ways within the system (rotations, soil fertility measures, adaptation of inputs etc). Use available knowledge to explore win-win situations improving both economy and environment. Yes – we will do that.

 

Nitrogen benefits and environmental costs,

December 12, 2012

More from IFS in Cambridge (se below)

In an introductory lecture prof Tim Benton mentioned that the European Nitrogen Assessment has made the estimate that the costs for the nitrogen losses from agriculture outweighs the value of the nitrogen fertilizer.

How can that be? Imagine that half the agricultural production suddenly disappeared.

I have to confess that I have not scrutinized the source, but I make an example of my own.

We have a cereal production giving 6 tons per hectare, today worth about  SEK 9000 , of which half is caused by the 100 kg nitrogen  (N) given as fertilizer.  The leaching of nitrate is 25 kg N.

What is the value? The cost for the nitrogen is 1000, it has produced 4500 in added value.

What is the environmental cost? The Swedish society has programs for reduced leaching, costs 50 to  100 per kg leaching reduced (artificial wetlands or catch crops). If the value 50 is used the cost for leaching is 1250.

Some comparisons:

The market value of the fertilizer is 1000, the cost for the leaching is 1250 or more.

With lower yields and prices an added value of the fertilizer use could be 2500. If we assume the leaching costs 100 per kg N this value will also be 2500.

We see that there are different ways to arrive att the introductory statement. It should be observed that the fertilization itself has caused an additional leaching of around 5-10 kg N.

It is the prices that are decisive for the outcome. Food prices are low, environmental work expensive. If fertilizer use and agricultural production are reduced the value of food increases and the relations will be different.

International Fertiliser Society: Meeting Challenges through Innovation

December 9, 2012

Conference Cambridge Dec 2012.

What challenges?

The growing world demand for food. Scarcity of land and water. Ecological limits are almost reached. We must produce more with less environmental impact. Sustainable intensification.

Some believe that organic agriculture is the solution. But the production is too low. We need increases, not reductions. We need an ecologically better general agriculture.

What innovations?

Higher and more reliable yields. The ambitious English project Wheat 20-20 (20 tons/ha year 2020), a combination of plant breeding and agronomic development.

Better adaptation of inputs and resources. More efficient phosphorus fertilization, for instance placement (common in Sweden) and maybe foliar or seed application as complements.

Focus also on potassium and magnesium. Deficiencies, also shortterm, reduce stress tolerance and yields.

Cover crops. They reduce nitrate leaching and in addition provide organic matter and are positive for life in soils. They function also as break crops in rotations.

Manure is a great problem. Theoretically a good solution is to move animal production back to crop producing farms. Go back to mixed agriculture. But that does not work in our economic reality.

Two ways are worked on: to improve the manure efficiency at farm level and to process manure to marketable or at least transportable products which can be removed from the farm. However, it is not an easy problem to solve.

The longterm nitrogen efficency of manure is low. The most efficient method, injection,  has a longterm efficiency of 55% compared to mineral fertilizer. In practice the efficiency today is only half of that.

A problem mentioned is that economic realities often do not permit use of improved agronomic measures. This a big problem for the world development.

Again – a revival. Economy and environment

November 2, 2012

How many lives in computer games?

Anyhow – it seems important – or at least a chance – to widen the world,  to maintain  this blog.

Farming is important, but it needs to be efficient both in production and for the environment and it needs to be sustainable. And there are hopes for this, if we use the knowledge we have and continue to move the knowledge base forward.

We may need help from politicians. Not all goals can be met if global price competition alone should govern the development. So – a discussion is important.

Further – sustainability, what is that?  Many ecologists would say that using nitrogen fertilizers is not sustainable. Arguments such as natural gas or oil will not last for ever may seem strong, but they are not relevant. There are other energy sources. Fertiliser factories should be included in the total picture. But we should use nutrients efficiently and optimize the system according to a comprehensive environmental analysis using current best available technology data.

Is the world food production on the right track? In some areas, yes, but what is done is not enough and efforts are in many cases counteracted by market forces or market institutions. Price competion seems to have priority. Sweden had a fairly ambitious program in many respects, both for nitrogen, plant protection and animal welfare. The somewhat increased costs for production have damaged Swedish agriculture, and hopes that this model should spread have not materialized. So we go backwards.

Anyhow, I hope to be able to maintain this blog. There is a parallell in Swedish (greengard.wordpress.com) which has been better cared to, and my intention is to translate and include some posts from there.

Competition and environmental costs.

February 2, 2011

In the agricultural press there is a continuing discussion about the competitiveness of  Swedish agriculture. We still have some added  costs for animal welfare, for restrictive plant and animal protection, for administrative inspections etc. We had a fairly well functioning nitrogen tax for several decades. But the added costs for Swedish production eventuaully made an abolishment necessary. We still have an animal welfare program giving added costs.

Sharp competition in production based on ecological systems with necessity will put press on these systems, be it soils or animals.

In fact it is odd that economists and politicians do not recognize this problem. Some  believe that the Market takes care of everything. But the commodity based market does not put value on environmentally benign production.

Branding? Yes, for small segments, for some producers and the retail market it might be favourable. But a brand with premium price cannot be large enough to make a large scale environmental difference. It is more cosmetics in the discussion. Or an alibi.

What could work? Economical compensation to the producer is one possibility. Another is to fully utilize the market economy. Environmental work might pay in better production. Encourage more longterm considerations and put a price on both costs and gains.

Agriculture stands for 3% of the economy but maybe 20% of the ecology.

December 15, 2009

 Focus Foresight. This was the start of this blog. Meaning that we both as individuals and farmers need to consider the ecology of the planet. The events this year have not diminished the urgency: climate discussion, ecological limits of the globe etc.

In a conference in Cambridge last week (International Fertiliser Society). Nitrogen Efficiency was discussed. Much can be done to improve the efficiency and reduce losses, for instance precision farming and improved manure management.

But how motivate the farmers? That was not on the agenda of the conference. The farmer acts in a competive market and his main concern is to reduce the costs. In fact, the society has given the farmer one primary goal: produce cheap products. Then – if possible – mind the environment.

There is a way forward: utilize available techniques and knowledge to combine both economic and environmental efficiency. Consider the economy over 4-5 years on your specific farm. Then probably both precision farming and cover crops to improve soil organic matter are positive also economically.

It is interesting to note that the development of crops and cultivars for high yields gives increased importance to maintenance of soil organic matter. 5 tons of wheat can be achieved even with some shortcomings now and then, but for 10 tons top performance is required at every stage. Soil organic matter gives resilience and top performance, and is also positive for environmental function and sustainability.

How combine environmental development with global competitiveness?

November 10, 2009

Test of an idea. 

The main agricultural products are commodities without identity. The prices are formed in international competition. Only for small niches premium prices can be attained, but almost per definition such niches cannot grow to be dominant. Premium price cannot be the norm. But environmental development is needed for the main production.

 Environmental development may mean extra costs and loss in competitiveness. The actual development in Sweden is a practical example. Everybody may gain if a certain development occurs but those who start will loose. The situation is called The prisoners´ dilemma.

Let us take the Swedish nitrogen tax as an example to discuss a possible solution.

 The tax paid by farmers (as a charge on the nitrogen price) could be redistributed to the farmers but without connection to the fertilizer use. The  tax would serve its purpose and increase the incentives to develop efficient nitrogen use but the farmers would not loose in competitiveness.

For nitrogen this system could be almost self-financing, but the society will be required to contribute to some extent. For other issues higher public contribution might be necessary. But who is “the society”?  Environmental development is of global interest. A global fund/organisation should be given the task to help neutralizing The prisoners´dilemma.