Sustainability of Organic Farming ���Perspectives from Science and Policy

Sebastian Lakner, MSc (Georg-August Universität Göttingen)

Universität Kassel, Witzenhausen October 16, 2009

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Outline

1 Introduction 2 Research-questions and methods 3 Ecological indicators 4 Economic indicators 5 Economic and ecological indicators 6 Discussion

October 16, 2009 Sustainability of organic farming – Slide 2 / 28 – Sebastian Lakner

1 Introduction���Organic farming in Germany: Status quo

•  Introduction of the EU Regulation 2092/91 •  Subsidies since 1991 •  „Agrarwende“ 2001 •  Research Programme: Bundsprogramm

Ökologischer Landbau •  Reform of the CAP in 2004 •  Introduction of ELER after 2005 •  Perspectives after 2013 •  Growing importance of GMO

October 16, 2009 Sustainability of organic farming – Slide 3 / 28 – Sebastian Lakner

Tab. 1: Support for organic grassland-farming in Germany (August 2009)

Federal state Program for rural development ELER-regulation

VO (EG) Nr. 1257/1999 (VO (EG) No. 1698/2005) Conversion Regular org. Conversion regular Difference

Berlin 153 € 102 € 131 € 128% Brandenburg 180 € / 130 € 130 € 131 € 101% Baden-Württemberg 130 € 130 € 150 € 115% Bayern 255 € 255 € 190 € 190 € 75% Bremen 285 € / 160 € 160 € 137 € 86% Hessen 190 € 190 € 160 € 84% Hamburg 153 € 160 € 137 € 86% Mc-Pomm 210 € 160 € 135 € 84% Niedersachsen 285 € / 160 € 160 € 137 € 86% Nordrhein-Westfalen 409 € / 204 € 153 € 262 € 137 € 90% Rheinland-Pfalz 205 € / 153 € 120 € 120 € 100% Schleswig-Holstein 285 € / 160 € 160 € 137 € 86% Saarland 210 € 160 € 262 € 116 € 73% Sachsen 244 € 244 € 262 € 137 € 56% Sachsen-Anhalt 252 € 192 € 252 € 192 € 100% Thüringen 230 € 205 € 187 € 160 € 78%

Germany 210 € 160 € 262 € 137 € 86%

150 € 94%

300 € 210 € 82 %

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1 Introduction���Organic farming: a growing sector

0%

5%

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15%

20%

25%

30%

35%

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5.000

10.000

15.000

20.000

25.000

Anzahl Öko-Betriebe

Betriebs-Wachstum

Marktwachstum

Sustainability of organic farming – Slide 5 / 30 – Sebastian Lakner October 16, 2009 Graph 1: Growth of the organic sector on the farm- and market-level since 1989 Source: Data 1995-2008 from farms controlled according to EU VO 2092/91, before1994 farms controlled according to the regulation fot the German working-group of organic farming (Arbeitsgemeinschaft Ökologischer Landbau (AGÖL)) (ZMP 1996)

1 Introduction���Research question

•  What is sustainable agriculture? •  Does the organic farming fit the criteria of

„sustainable agriculture“? •  Can we justify support for organic farming?

Methods •  Based on ecological and economic indicators •  On the background of German agricultural policy

October 16, 2009 Sustainability of organic farming – Slide 6 / 28 – Sebastian Lakner

2 Methods���Definition of sustainability

Forest Economics 18.century „A sustainable yield ist the maximum wood-yield in the

presence without risking future yields” Hans Carl von Carlowitz (1645-1714)

UN-”Brundland-Report” (1987) “Sustainable development is development that meets

the needs of the present without compromising the ability of future generations to meet their own needs“

October 16, 2009 Sustainability of organic farming – Slide 7 / 28 – Sebastian Lakner

2 Methods���Definition of sustainability (2) Recent Cases Siemens: “How can we go for sustainable....“ BMW: Joschka Fischer as a consultant for sustainability RWE: Advertisement of RWE in cinema

Disadvantages / Critique The term… •  1.) excludes power structures •  2.) wipes away the different interests of the stake holder •  3.) is flexible in use for everyone���

(Industry, Political Parties, environmental NGOs...).

Eblinghaus und Stickler (2003) “Abuse of sustainability for own purposes” “dominate the public discourse“ („Diskurshoheit gewinnen“)

October 16, 2009 Sustainability of organic farming – Slide 8 / 28 – Sebastian Lakner

Figure 1: Framework to evaluate environmental indicators OECD (2001) October 16, 2009 Sustainability of organic farming – Slide 9 / 28 – Sebastian Lakner

2 Methods How to measure sustainability (1)

pressure

driving force farm / firm

state

response

impact

natural resources

human ressources

Figure 11: Framework to evaluate environmental indicators OECD 1997, Stolze et al. 2000

October 16, 2009 Sustainability of organic farming – Slide 2 / 30 – Sebastian Lakner

2 Methods ���How to measure environmental sustainability (2)

2 Methods���How to measure sustainability (3)

Sustainability includes -  Ecological indicators -  Economic indicators -  Social indicators

-  Includes a discussion of stakeholder- and interest-groups

-  Compromises and power

October 16, 2009 Sustainability of organic farming – Slide 11 / 28 – Sebastian Lakner

2 Methods���An appropriate indicator for policy use

Measurement issues •  Easy to measure •  Many data available •  Aceptable costs of measuring •  Different data in location and time •  Aggregation of single indicators Reactive on changes in farming systems Accepted by different stakeholder

October 16, 2009 Sustainability of organic farming – Slide 12 / 28 – Sebastian Lakner

3 Ecological Indicators���

Ecological indicators: •  1. Nitrate-leaching into the ground-water •  2. Biodiversity: weed species & agricultural birds •  3. Overview

October 16, 2009 Sustainability of organic farming – Slide 13 / 28 – Sebastian Lakner

October 16, 2009 Sustainability of organic farming – Slide 14 / 28 – Sebastian Lakner

Figure 2: Development of the bird-population in United Kingdom 1970 - 2007 Source: Brit. Government 2009, data from RSPB, BTO, DEFRA

Farmland Birds (19)

Woodland species (38)

Seabird species (20)

Inde

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3 Ecological Indicators���Biodiversity: results

Weed species •  higher diversity of weed-species ���

(1.5 ot 6 times higher) Agricultural Birds •  abundance and diversity of agricultural birds •  Red-list bird-species •  Advantages of organic farming

October 16, 2009 Sustainability of organic farming – Slide 15 / 28 – Sebastian Lakner

3 Ecological Indicators���Potential for improvement

Nitrate Leaching Incentives for improvement, Large research activities

Agricultural Birds More awareness Landscape research

Weed species Negative incentives, “negative improvement” Little openness for discussion at the farmers association

October 16, 2009 Sustainability of organic farming – Slide 16 / 28 – Sebastian Lakner

Figure 3: Asessment of organic impact on envrionment

October 16, 2009 Sustainability of organic farming – Slide 17 / 28 – Sebastian Lakner

Autoren Bewertung System Standort Wasseruntersuchung und N-min

Brandhuber und Hege (1992) öko ++ praxis Bayern

Kristensen et. al. (1994) öko=konv praxis Dänemark

Haas et. al. (1998) öko ++ fakto. Niederrhein (NRW)

Ruhe et. al. (2002) öko=konv vers. Schleswig-Holstein

öko + vers.

Stopes et. al. (2002) öko + praxis England

Eltun et. al. (2002) öko + fakt. Südost Norwegen

öko=int fakt.

Poudel et. al. (2002) öko ++ fakt. Californien

Bilanzierungen und Modellierungen

Hege et. al. (2003) öko ++ praxis Bayern

Drinkwater et. al. (1998) öko ++ fakt. USA

Hansen et. al. (2000) öko ++ praxis Dänemark

Dalgaard et. al. (2002) öko + praxis Jütland

Übersichtsarbeiten

Haas (2001) öko ++ Europa

Piorr und Werner (1998) int + Europa

Stolze et. al. (2000) öko + Europa

Frangenberg et. al. (1996) int ++ Deutschland

Table 2: Result of different studies on nitrogen-loss Source: Lakner 2004

4 Economic Indicators���Economic Indicators

Indicator for economic state of organic farming: •  Economic performance of single farms •  Monetarisation of externalities •  Scenarios of regional changeover to organic farming •  Market development •  Price development •  Efficiency?

October 16, 2009 Sustainability of organic farming – Slide 19 / 28 – Sebastian Lakner

4 Economic Indicators���Economic performance of organic farms

Figure 4: Profit + labour-costs of organic and comparable farms in Germany 1995-2006

Source: Nieberg 2008 from data of the ministry for agriculture, div. years October 16, 2009 Sustainability of organic farming – Slide 20 / 28 – Sebastian Lakner

4 Economic Indicators���Market development in organic farming

Figure 5: Turnover for organic food in Germany 2000-2005 Source: own calculation according Rippin & Hamm 2007, BÖLW 2009)

October 16, 2009 Sustainability of organic farming – Slide 21 / 28 – Sebastian Lakner

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2000 2001 2002 2003 2004 2005 2006 2007 2008

Market-share of turnover (%)

September 24, 2008 Sustainability of organic farming – Slide 22 / 28 – Sebastian Lakner

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Weizen  I                                          (Protein  >  11,5  %)  

Weizen  II                  (Protein  10  -­‐  11,5  %)  

Weizen  konv.  

EUR/dt  

All  prices  „free  at  the  trader/m

ill  “,  monthly  data  

source:  own  elaboraAon,  data  by  ZM

P  2007  

Figure 6: Organic and conventional wheat prices ���Source: (ZMP 2008)

October 16, 2009

4 Economic indicators���Conversion to organic farming?

October 16, 2009 Sustainability of organic farming – Slide 23 / 28 – Sebastian Lakner

Figure 7: Growth of the organic sector: market and production���Source: Calculation according to ZMP, Statistical Office Germany and Hamm & Rippin 2007

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Growth market share (%)

Growth organic farms (%)

Figure 7: Economic and Environmental Efficiency���Source: own elaboration, results from Kantelhardt et al. 2009

5 Economic and ecological indicators��� Data envelopment analysis

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Environmental Efficiency

Organic farming

Reduced extensification of grassland use Enlarged extensification of grassland use Diversification of arable land use

No Participation

6 Discussion: ���Results of the assessment

•  Organic farming seems to be a “sustainable system”

Open questions •  Food security: Can organic feed the world? •  Quality issues •  Energy efficiency? •  Social indicators of organic farming

October 16, 2009 Sustainability of organic farming – Slide 25 / 28 – Sebastian Lakner

6 Discussion ���Theoretic reason to promote organic farming

Promoting organic farming •  Internalize externalities ✔ •  Asymmetric distributed information ✔ •  Infant industry ? •  Meritoric goods ✘

October 16, 2009 Sustainability of organic farming – Slide 26 / 28 – Sebastian Lakner

6 Discussion Converting farms as “infant industries” ?

Sustainability of organic farming – Slide 2 / 30 – Sebastian Lakner October 16, 2009 Figure 10: Technical efficiency of organic grassland farms during the conversion period Source: Own calculation

6 Discussion ���Organic farming as an answer to…

•  Nitrate and pesticides leaching ✔ •  Nitrogen/Energy loss ✔ •  Quality issues: BSE, Nitrofen, Gammelfleisch ? •  Climate change ? •  Genetic engineering (!) ✔ •  Landscape issues, Loss of Biodiversity ✔

October 16, 2009 Sustainability of organic farming – Slide 28 / 28 – Sebastian Lakner

September 24, 2008

Thank you for your attention !

Questions ?