Agricultural land use in response to future policies and scenarios

Agricultural land use in response to future policies and scenarios Christoph Sahrbacher, Mark Brady, Changxing Dong, Amanda Sahrbacher Leibniz-Institute of Agricultural Development in Central and Eastern Europe (IAMO) sahrbacher@iamo.de Dissemination Workshop Brussels, 29.02.2012 1

Modelling Implementing of Soil-C into AgriPoliS Change of Soil-C depending on production Disaggregation of Production activities in the mixed integer programme (MIP) Yield function depending on Soil-C Optimal N-input based on market prices and Soil-C 2

AgriPoliS Invest? Quit? Maximise householdincome Grow? Interactions Land market Actions Assumptions Quit if opportunity costs > expected household income Quit if equity capital < 0 - Agent based - Spatial - Dynamic Happe et al. (2004) 3

Study regions South East England (UK) Gotelands southern plains (Sweden) Surrey Kent West Sussex East Sussex Total UAA study regions UK ~ 460,000 ha Sweden ~ 200,000 ha 4

Annual change in C relative to the actual C-content [%] [%] Sweden arable land high quality Sweden arable land low quality UK -0.5 Winter wheat Other grains Rape seed Sugar beet Grains Rape seed Wheat Rape seed Potatoes Forage maize +1.0 Set aside Grass silage Arable pasture Set aside Temporary grassland Set aside 5

Optimal and actual Soil-C [%] Soil type Other grain Wheat Rape seed, sugar beet Sweden Sweden/UK Sweden/UK Optimal Soil-C 2.37 2.91 3.21 Soil-C Sweden 2008 Arable land high quality 2.16 Ø2.48 5.95 Arable land low quality 2.38 Ø3.50 5.60 Soil-C UK 2008 Arable land 1.99 Ø2.54 3.23 6

Land use in 2011 Set aside Sugar beet Rape seed Set aside Grass silage Potatoes Set aside Arable pasture 45 Increase C Rape seed Grass silage Rape seed Wheat Wheat Grain Sweden high qualtiy Sweden low quality UK 8

Scenarios Simulations till 2032 Reference Policy change after 2013 7% set aside obligatory fallowing of 7% of arable area, rotational 15% set aside 25% set aside 9

Change in Soil-C from 2012 to 2032 Scenario Soil C in 2012 0% 7% 15% 25% Unit [%] [%] [%] [%] [%] Sweden Arable land high quality 2.42-0.23-0.19-0.13-0.07 Arable land low quality 3.52 +0.15 +0.20 +0.25 +0.27 UK Arable land 2.5-0.21-0.19-0.14-0.07 10

Yield losses from 2012 to 2032 Scenario Average yield 0% 7% 15% 25% Unit dt/ha dt/ha dt/ha dt/ha dt/ha Wheat Sweden 79.3-2.1-1.7-1.2-0.5 UK 85.4-1.1-1.0-0.7-0.4 Rape seed Sweden 36.7-2.3-1.9-1.4-0.7 UK 32.7-2.1-2.0-1.4-0.6 Sugar beet Annual yield loss of 0.03 0.07% Sweden 325.0-28.1-21.0-14.5-7.0 11

N-input on fertilized area 12

Increase in N-input from 2012 to 2032 Scenario N-input 0% 7% 15% 25% Unit kg/ha kg/ha kg/ha kg/ha kg/ha Wheat Sweden 158 +9.9 +8.3 +6.1 +3.1 UK 200 +1.8 +1.7 +1.2 +0.6 Rape seed Sweden 172 - - - - UK 210 - - - - Sugar beet Sweden 120 +19.9 +15.3 +11.0 +5.5 13

Losses from 2012 to 2032 Scenario Gross margin 0% 7% 15% 25% Unit /ha /ha /ha /ha /ha Wheat Sweden 687-31 - 25-18 - 9 UK 535-13 - 12-9 - 4 Rape seed Sweden 589-54 - 45-32 - 16 UK 429-49 - 46-32 - 13 Sugar beet Sweden 1194-20 - 15-11 - 6 14

Relative losses in gross margin 2012 to 2032 Scenario Gross margin 0% 7% 15% 25% Unit /ha % % % % Wheat Sweden 687-5% - 4% - 3% - 1% UK 535-2% - 2% - 2% - 1% Rape seed Sweden 589-9% - 8% - 5% - 3% UK 429-12% - 11% - 8% - 3% Sugar beet Sweden 1194-2% - 1% - 1% - 0% 15

Profit per hectare 16

Average farm size 17

Labour input 18

Profit per Annual Working Unit (AWU) 19

Conclusions General set aside not useful Mainly low quality land would be set aside Soil degradation is a slow but continuous process 0.03 0.07% annual yield loss in study regions Within 20 years loss of up to 50 /ha More than outweight by technological progress Soil consveration will become more important with increasing fertilizer costs 20

Outlook Price scenarios Hardly affect management decissions and Soil-C Policy might be necessary to improve soil conservation 21

Thank you for your attention! 22