Economic Modeling of Hungarian Farms Incorporating Nature Conservation

Hungary's imminent entrance into the EU calls for a farm-level financial support system aiming at combining agricultural production with nature conservation targets. Within the Hungarian National Agri-environmental Programme (NAEP) for the Environmentally Sensitive Areas, a payment system was developed. For each individual region the amount of support for every environmentally friendly farming prescription package (tier) was established using the support calculation methodology of the EU. The purpose of this paper is to analyse the impact of the packages on the income of an individual mixed farm. In contrast to many other studies, in the current study the analysis was carried out with the context of the whole farm, taking into consideration the entire production structure. The amount of support which the farmer needs to sign up for a contract turned out to be quite different from the actual payments done by the Hungarian government.Farm Management, Land Economics/Use,

Dominos in the dairy: An analysis of transgenic maize in Dutch dairy farming

Isolation distances to limit the risk of cross-pollination from transgenic to nontransgenic crops can severely limit the potential use of transgenic crops through a so-called 'domino effect' where a field of non-transgenic crops limits adoption of transgenic crops not only on plots in its direct vicinity, but also in plots further away as its neighbors are forced to grow the non-transgenic varieties, forcing their neighbors to grow the non-transgenic variety, and so on. The extent to which this effect takes place, however, may depend crucially on the type of farm. For example, dairy farms can use grassland as a buffer between transgenic and conventional maize plots. This article assesses the effects of isolation distances for transgenic maize in dairy farming. A spatially explicit farm model is applied to a region in the Southern Netherlands to identify to what extent a single farmer (who uses non-transgenic maize) can limit other farmers’ potential to grow transgenic maize. The main findings are that 50% or more of the farms in the study area will not affect the potential adoption of transgenic maize by growing conventional maize at all. This result even holds under distance measures of 800m, which is the largest distance implemented by member states of the European Union. When they do have such effects, isolation distances can reduce the benefits from transgenic maize by €5,000 - €6,000, for a considerable part through a domino effect. Large net benefits of transgenic maize may limit the spatial effects as farmers are more willing to relocate maize production to areas where transgenic maize is allowed.Crop Production/Industries, Livestock Production/Industries,

Comparison of Different Studies to Analyse Adaptation on Dairy Farms

This paper compares and contrasts a number of farm-level modeling studies published in the academic literature. All of the studies examined adaptation on EU dairy farms in response to developments in agricultural policy and/or environmental legislation. The studies are compared on the basis of their respective aims, model structure, results and conclusions. Having reviewed the models and their application, the discussion section of the paper considers strengths and weaknesses of the studies and following from that it considers possible future developments in farm-level response modeling. The relevance and application of such developments in the context of an analytical study of adaptation in Irish dairy farms is discussed.Farm Management, Research Methods/ Statistical Methods,

An LP-Model to Analyse Economic and Ecological Sustainability in Dutch Dairy Farming

Since the enactment of the Economic Growth and Tax Relief Reconciliation Act of 2001, owners and operators of farms and ranches have opportunities to evaluate new estate planning strategies for the transfer of farm businesses to subsequent generations. However, with provisions of the Act to be phased in over several years, consideration must be given to having a "staged" estate plan. Under provisions of the current law, estate tax is repealed in the year 2010, but if Congress does not act, the legislation sunsets and returns to prior law January 1, 2011. This fact provides planning challenges for owners and operators of farms and ranches as the phase-in of provisions, the repeal in 2010, and the return to prior law relative to estate planning and business inter-generational transfer of property. This paper investigates the planning process and options available as they relate to a family-owned property in North Carolina, USA. Plans made must take into consideration the dynamics of a changing legislative environment, special-use valuation of land, opportunity cost of alternative uses for land, and off-farm heirs.Environmental Economics and Policy, Livestock Production/Industries,

Multivariate Typology of Farm Households Based on Socio-Economic Characteristics Explaining Adoption of New Technology in Rwanda

The challenge for agricultural policymakers and planners, particularly in the context of Rwanda with high population density and consequently food insecurity, is how to enable farmers to adopt new technology. It is known that adoption of new technology may vary among farm households because of socio-economic characteristics. This paper intends to typify farm households in Rwanda based on the exploration of factors explaining adoption of new technology. Ultimately, typical farms obtained from the typology will be used, later as basis to develop representative mathematical programming models. Multivariate statistical techniques offer the means of creating such typologies, particularly when an in-depth database is available. This multivariate analysis approach, combining principal component analysis (PCA) and cluster analysis (CA), has allowed us to identify clearly five typical farm households and their socio-economic characteristics explaining adoption of new technology.. Multivariate statistical techniques, such as PCA and CA, are great tools to envisage building mathematical programming models on the basis of typical farm households.Agricultural and Food Policy, Community/Rural/Urban Development, Consumer/Household Economics, Food Consumption/Nutrition/Food Safety, Food Security and Poverty, Land Economics/Use, Marketing, Production Economics, Research and Development/Tech Change/Emerging Technologies,

Development of nature-oriented dairy farm systems with an optimization model: the case of ‘Farming for Nature’ in ‘de Langstraat’, the Netherlands

‘Farming for Nature’, a relatively new policy instrument being tried out in the Netherlands, is evaluated. The concept has been designed to allow dairy farmers to improve nature conservation on their farms. Under the scheme, no manure, fertilizer, or feed – concentrates or roughage - may be imported into farm systems from external sources. The feasibility of such a self-sustaining system and the conditions required for it to deliver the desired results, are explored with a farm-based linear programming model known as FIONA (Farm based Integrated Optimization Model for Nature and Agriculture). The model is explained and applied to ‘de Langstraat’, a region in southern Netherlands. The results show that levels of production under the ‘Farming for Nature’ regime are dependent upon soil fertility and the proportion of land that is suitable for growing arable crops. If all available land on a dairy farm in the scheme is arable land, then high production levels of up to 7,500 kg milk per hectare can be realized. If only 30% of the farm area is suitable for arable crops, then only lower production levels, of about 6,600 kg milk per hectare can be realized. The scheme has positive ecological effects. Both nature and cultural landscape values may benefit significantly from the concept. Improvement in ecological terms however, carries a price in terms of agricultural income. An average dairy farm adopting the concept of ‘Farming for Nature’ experiences an income loss of approximately € 840 per hectare in the short-run (5-10 years). More important is the observation that the scale of such farms in the short-run might be too small to earn an attractive income for its workers, even when fully compensated according to European Union regulations.nature management, dairy farming system, linear programming, farm-economics, Farm Management, Land Economics/Use,

Integration of all FSSIM components within SEAMLESS-IF and a stand alone Graphical User Interface for FSSIM

Agricultural and Food Policy, Environmental Economics and Policy, Farm Management, Land Economics/Use,

Comparison at Dairy Farm Level of Different Policies to Decrease Nutrient Losses to Ground and Surface Waters in the Netherlands

This paper describes and compares two governmental policies that aim to decrease nutrient losses from farming to ground and surface waters in the Netherlands. The mineral bookkeeping system (MINAS) is the first policy. It is applied in the Netherlands since 1998 and it is based on a farm gate balance approach. This national policy was definitely rejected on October 2, 2003 by the EU Court of Justice as it was considered not to comply fully with the EU Nitrate Directive. Consequently, the Netherlands developed the Application Standards Policy (ASP) based on a soil balance approach which will replace MINAS starting 2006. Especially for dairy farming, that combines plant and animal production, nutrient input and output at soil level are hard to determine as nutrient input via manure and nutrient output via grass and forage is not measured. ASP, therefore, works with standards leaving less incentives for individual farmers to improve their nutrient use efficiency through farm management. Comparison of the policies by means of modeling at farm level shows partial removal of manure and replacement of the nutrients in this manure by fertilizer for an intensive dairy farm when changing from MINAS to ASP. This leads to a decreased cost-effectiveness as nutrient losses remain roughly the same while the farm income decreases substantially. Also the income of an extensive dairy farm decreases, but there nutrient losses also decrease. The value of this last decrease is questionable, however, as the nutrient surpluses on the extensive farm are below the surpluses that are considered acceptable given the buffering capacity of the environment. The partial removal of manure from intensive farms will definitely lead to problems on the manure market in the Netherlands as it is already difficult in the current situation to place all the surplus manure in a responsible way on arable farms

Economic Modeling of Hungarian Farms Incorporating Nature Conservation

Hungary's imminent entrance into the EU calls for a farm-level financial support system aiming at combining agricultural production with nature conservation targets. Within the Hungarian National Agri-environmental Programme (NAEP) for the Environmentally Sensitive Areas, a payment system was developed. For each individual region the amount of support for every environmentally friendly farming prescription package (tier) was established using the support calculation methodology of the EU. The purpose of this paper is to analyse the impact of the packages on the income of an individual mixed farm. In contrast to many other studies, in the current study the analysis was carried out with the context of the whole farm, taking into consideration the entire production structure. The amount of support which the farmer needs to sign up for a contract turned out to be quite different from the actual payments done by the Hungarian government

Dominos in the dairy: An analysis of transgenic maize in Dutch dairy farming

Isolation distances to limit the risk of cross-pollination from transgenic to nontransgenic crops can severely limit the potential use of transgenic crops through a so-called 'domino effect' where a field of non-transgenic crops limits adoption of transgenic crops not only on plots in its direct vicinity, but also in plots further away as its neighbors are forced to grow the non-transgenic varieties, forcing their neighbors to grow the non-transgenic variety, and so on. The extent to which this effect takes place, however, may depend crucially on the type of farm. For example, dairy farms can use grassland as a buffer between transgenic and conventional maize plots. This article assesses the effects of isolation distances for transgenic maize in dairy farming. A spatially explicit farm model is applied to a region in the Southern Netherlands to identify to what extent a single farmer (who uses non-transgenic maize) can limit other farmers’ potential to grow transgenic maize. The main findings are that 50% or more of the farms in the study area will not affect the potential adoption of transgenic maize by growing conventional maize at all. This result even holds under distance measures of 800m, which is the largest distance implemented by member states of the European Union. When they do have such effects, isolation distances can reduce the benefits from transgenic maize by €5,000 - €6,000, for a considerable part through a domino effect. Large net benefits of transgenic maize may limit the spatial effects as farmers are more willing to relocate maize production to areas where transgenic maize is allowed