Sustainable Agriculture Requires Farm Modernization, Free Markets, Tech Adoption

June 26, 2009

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A new report focuses on the challenge of how to sustainably meet the growing energy and food demands of a global population approaching nine billion people in 2050.

The report, “Investing in Agriculture: Far-Reaching Challenge, Significant Opportunity: An Asset Management Perspective,” from DB Climate Change Advisors, focuses on the steps needed to boost agricultural productivity as the world’s population grows through 2050.

DBCCA, in collaboration with The Nelson Institute’s Center for Sustainability and the Global Environment (SAGE) at the University of Wisconsin-Madison (UW), estimates that the caloric needs globally will increase 50 percent by 2050 driven by population, wealth and diet as well as biofuel demand.

According to the report, “a lack of investment, misguided agricultural policies and subsidies, and lack of farmer education, training, and adoption has led to low agricultural productivity in much of the world,” but “with proper policy guidelines in place that encourage farm modernization, free markets, and technology adoption, the production gap can be closed.”

There are several tariff systems and subsidies that create distortions in the global agriculture markets, say researchers. In addition, policy makers and scientists are asking how agriculture can help to mitigate carbon emissions, which they say is evident in the U.S. Waxman-Markey legislation.

The report says sustainable forestry, addressing deforestation, and ending slash-and-burn agricultural conversion are the answers, together with carbon sinks that can also be created through practices that sequester carbon in agricultural soils.

The study finds that the agriculture sector can participate in the mitigation of climate change due to its ability to store and cycle CO2 and to provide potential offset markets for the trading/management of carbon. This can be done through a number of technologies and management practices such as no-till cropland management, planting of perennials and the development of biochar resources, according to the study.

In the U.S., a recent sustainable agriculture survey released by Rabobank finds that nearly 70 percent of the U.S. farmers and ranchers have taken steps toward implementing sustainable agricultural practices, and dairy farmers are striving to cut 25 percent annual GHG emissions related to the production of fluid milk by 2020.

Also, the recently released Voluntary Carbon Standard (VCS) allows agriculture, forestry and other land use (AFOLU) projects to generate carbon credits that are interchangeable with other carbon credits generated by non-AFOLU activities such as energy and industrial projects.

The report looks at the challenge of boosting productivity in three areas. The researchers evaluated the world’s existing agricultural lands and raised the productivity using the best available practices. This would entail massive investment in production technologies and yet, supply would fall short of meeting demand, say researchers.

They also looked at using additional lands such as degraded and abandoned lands, pasturelands and multi-cropping while still preserving existing forests, which still may not meet global demand, according to the report.

Taking into consideration the resulting increased use of water and land as well as increased greenhouse gas emissions in a climate change framework, some alternative approaches were considered by researchers such as low-input organic farming practices, broad scale reallocation of land uses, and the potential of using more biotech crops, to maximize output with minimal input.

On the investment front, the report outlines the long-term view that the upward trend in agricultural prices will return, which should stimulate investment and offer large investment opportunities across the agribusiness industry including fertilizers, irrigation, mechanization, sustainable biofuels as well as management practices and infrastructure development.

The report also analyzes production trends, identifies opportunities for improvement and studies the supply-side responses that will attract capital in the effort to boost agricultural output.

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