Nachhaltige Produktion von Nachwachsenden Rohstoffen in Entwicklungsländern durch Kleinbauern in outgrower-schemes

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1 Nachhaltige Produktion von Nachwachsenden Rohstoffen in Entwicklungsländern durch Kleinbauern in outgrower-schemes Dr. Thomas Breuer & Max Baumann Junior Planning Officer Promotion of Agriculture and Food Ifas 9. Biomasse-Tagung energetische und stoffliche Nutzung von Biomasse 5./6. November 2009 Division "Agriculture, Fisheries and Food" Page 1

2 Outline: Bioenergy and biofuels from a development perspective What is the policy makers position? Action and view of investors Challenges of investors The need for public private partnership Outgrower-schemes for sustainable biofuel production with smallholders Division "Agriculture, Fisheries and Food" Page 2

3 Bioenergy and biofuels from a development perspective Division "Agriculture, Fisheries and Food" Page 3

4 Bioenergy and biofuels from a development perspective Key aspects for consideration: 1. Impact on Millennium Development Goals (MDG) 50 % reduction of absolute number of poor people by 2015, 70 % live in rural areas 2. Impact on Global Sustainability regarding the economic, social and ecological dimension of development 3. Impact on Global Climate Change regarding GHG emissions targets and efficiency Division "Agriculture, Fisheries and Food" Page 4

5 Expected Global Demand for Biofuels Division "Agriculture, Fisheries and Food" Page 5

6 Resource availability: land, water, capital.. Division "Agriculture, Fisheries and Food" Page 6

7 Situation in 2008: Food and Fuel Debate Division "Agriculture, Fisheries and Food" Page 7

8 Biomass potential on marginal land Potential analysis Definition: Marginal lands are lands with very low productivity and difficult to cultivate due to natural (climate conditions, soil properties etc.) and/or anthropogenic (soil degradation through erosion or contamination etc.) factors. Marginality does not imply that the land cannot be used or improved. Marginal lands are used as pastures, for the production of wood fuel and for some food crops. * 1 Division "Agriculture, Fisheries and Food" Page 8

9 What is the policy makers position? Division "Agriculture, Fisheries and Food" Page 9

10 Bioenergy targets and the increasing demand for sustainably produced bio fuels OECD Outlook : Biofuels billion litres Average Bio Diesel Average Bio Ethanol Source: OECD: Outlook United States Brazil EU 27 Indonesia Malaysia China India ROW => Bioenergy is a political market Division "Agriculture, Fisheries and Food" Page 10

11 Bioenergy & biofuels as political market due to subsidies & set targets high responsibility and need for setting conditions to avoid negative social and ecological impact of large scale plantations to ensure achievement of international goals for climate change, the MDG s and the commitment for sustainable development to avoid negative impact on food security and to foster the achievement of the right to food => Need for sustainability systems as required in the EU and national directives Division "Agriculture, Fisheries and Food" Page 11

12 The action and view of investors Division "Agriculture, Fisheries and Food" Page 12

13 Observations of investors actions and capacities Investors enter developing countries for acquiring large portions of land (land grapping) Promise large private investments in rural areas in developing countries Meet powerless and often impoverished rural people and weak authorities which ensures easy access to land Create high expectations among the local people Most investors have little or no experiences»with participatory planning and working approaches»farming operations and natural resource management»in how to deal with and operate under weak political frame conditions and legal structures Division "Agriculture, Fisheries and Food" Page 13

14 The Industrialised Production Model: The bigger the better Control of the whole value chain Industrialised cane farming: Capital intensive production with high level of mechanisation Large scale monoculture cane production with units of above ha Externalisation of environmental and social costs Destruction of biodiversity and important natural resources No involvement of local farmers; local people just provide cheap labour for cane cutting, service jobs Large investments with little effects on sustainable development of the country and in remote rural areas Division "Agriculture, Fisheries and Food" Page 14

15 The need for Public Private Partnership Division "Agriculture, Fisheries and Food" Page 15

16 The reality in rural areas on developing countries Division "Agriculture, Fisheries and Food" Page 16

17 Investors challenges: Need to comply with sustainability criteria and certification Consideration of environmental standards to maintain, improve and avoid negative impact on Agro-+ Biodiversity, High Value Conservation and protected areas Avoid degeneration of soils and air and water pollution Ensure land use right and ownership of smallholders, and social standards: e.g. the right to form unions; Ensure efficiency criteria to achieve climate change policy targets GHG efficiency of 35 % later increase to 50 % along the whole lifecycle Consideration of carbon released due to land use change Ensure positive impact on economic development of the production region Division "Agriculture, Fisheries and Food" Page 17

18 Division "Agriculture, Fisheries and Food" Page 18

19 Outgrower-schemes for sustainable biofuel production with smallholders Division "Agriculture, Fisheries and Food" Page 19

20 SWOT-Analysis Sugar Cane Outgrower Programme Increase farmers practical skills in Sugar Cane, crop and irrigation management Increase farmers business skills Develop infrastructure & establish educational and health facilities for local population in rural areas Inadequate policies Poor institutional and physical infrastructure Farmers lack information for competent seedcane production & skilled marketing Alleviate poverty of local farmers & link small scale producers to (inter-) national markets Develop sustainable income for factory owners, employees and farmers Increase diversified food production and quality of live for rural people Global sugar & ethanol market demands & price fluctuations High competition and low fuel prices Political distortions through subsidies and wrong political priorities Division "Agriculture, Fisheries and Food" Page 20

21 Model for sustainable biofuel production with smallholders: e.g. sugar cane based biothanol production 1. Investment and Capacity Development with participating young farmers and their families which are taking people out of poverty 2. Improve sustainable land management on ha with consideration of Improved food security and the right to food Participation and environmental planning Maintenance and strengthening of social freedom Carbon sequestration and GHG reduction efficiency 3. Establish Nucleus Sugar Cane Estate, Processing Company and cane based value chains 4. Organize farmers in out grower and shareholder scheme for the management of sustainable cane and food crops production Division "Agriculture, Fisheries and Food" Page 21

22 Time Sequence of Local Farmer Integration in a Farmer Field School Concept Year 0: 40 Farmer Trainers Year 1: 40 Farmer Trainers & 440 Farmers Year 2: 40 Farmer Trainers & 840 Farmers Year 3: 40 Farmer Trainers & 1,240 Farmer Year 4: 40 Farmer Trainers & 1,640 Farmer Year 5: 40 Farmer Trainers & 2,040 Farmer Year 6: 40 Farmer Trainers & 2,440 Farmer Year 7: 40 Farmer Trainers & 2,840 Farmer 40 Farmer Trainers, selected by Social Team, informants, interviews, PRAs, group meetings, train 400 Farmers The best 10% of last year trained Farmers become Farmer Trainers to train 400 new farmers beside their own cultivation Division "Agriculture, Fisheries and Food" Page 22

23 A PPP Model for sustainable ethanol production on ha with smallholder farmers (II): 5. Regional development for settlements, agricultural and forestry area: Survey and plan land use for Out grower scheme 80,000 ha of under utilized lands» Sugar cane cops area 20,000 ha» Food crops area ha» Fallow and pasture area ha» Nucleus farm and research and cane propagation area ha» Settlement area, social and road infrastructure 6,000 ha» Conservation and Forestry area ha Division "Agriculture, Fisheries and Food" Page 23

24 Estimated Investment Private investment for the cane plantations and Mill/ Distillery /Biogas Plant Cane plantations Mill/ Distillery /Biogas Plant 80.0 Mio Mio Mio Public investment for Rural Economic Development Land use, community and spatial planning 8yrs Settlement of farm families ($ 4000/family) Physical & social Infrastructure Development Governance, Social and Financial Services Rural electrification Landscape development Total 10.0 Mio 12.0 Mio Mio 16.0 Mio 15.0 Mio 12.0 Mio 80.0 Mio Division "Agriculture, Fisheries and Food" Page 24

25 Conclusions There is an increasing global demand on biofuels The discussion should not focus on whether it is the right decision to invest in biofuels, but: How to invest in biofuels? Investments need to comply with social, economical and ecological sustainability The best measure to assure this sustainability and a broad development is to take the farmer as centric player Division "Agriculture, Fisheries and Food" Page 25

26 Thank you for your attention Contact: Dr. Thomas Breuer Deutsche Gesellschaft für Technische Zusammenarbeit (GTZ) GmbH Postfach 5180, Eschborn Tel.: / , Fax: / Contact: Max Baumann Deutsche Gesellschaft für Technische Zusammenarbeit (GTZ) GmbH Postfach 5180, Eschborn Tel.: / , Fax: / Division "Agriculture, Fisheries and Food" Page 26

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