Newsletter from Danish Research Centre for Organic Farming • June 2004 • No. 2

Articles in this issue

Composting rapidly degrades DNA from genetically modified plants

Susceptibility of spelt to Ochratoxin A producing fungi

Orchard testing of new, alternative fungicides against apple scab

Spatial variation in the localization of Danish organic farms

Inter-row subsoiling increases marketable yield in potatoes

Impact of new technologies and changes in legislation on the income in organic farming

Control of apple scab by use of the plants own defence mechanisms

Revision of organic rules in EU

Optimizing quality, safety and costs of low input food

Catch crops may improve plant sulphur nutrition

Simulating root growth

Nature conceptions, management and cross-compliance in organic farming

Wind dispersal of genetically modified pollen from oilseed rape and rye fields

Brief news


Front

Impact of new technologies and changes in legislation on the income in organic farming

By Research Assistant Niels A. Madsen and Senior Researcher Brian H. Jacobsen, Danish Research Institute of Food Economics

The economic consequences of legislative changes and new technology in organic farming has been examined. Through an interactive process between research experts and agricultural advisors, a technical and biological description of 8 organic case-farms (4 arable, 3 dairy and 1 pig farm) was envisioned (Nielsen et al., 2003). The crop rotation and the production structure of the case farms were chosen as to depict the organic farms of the near future.

In order to analyse the consequences on labour input, machinery input and operational cost, case studies have been chosen as the overall methodology. Scenario planning is used as the method of combining factual data and expert evidence to create imaginable and credible scenarios envisioning possible futures.

The most relevant innovative technologies in organic farming were selected. The technologies include automatic milking, GPS controlled allocation of manure, band-steaming and robotic weeding for intra-row weed control. Some of these technologies will also be introduced on conventional farms. The legislative changes have their focal point in the organic philosophy and could overall be described as a step towards a 100 percent organic production. These changes include 100 percent organic feed, straw and animal manure, thus including a stop for use of conventional animal manure.

Innovative technologies

The analysis indicates that some innovative technologies do increase the profit at some of the case farms. The economic benefits of automatic milking are limited and uncertain. As a result the technology is not expected to increase the profitability at organic dairy farms. The potentials of GPS controlled allocation of manure is most likely limited because of the uncertain effect on the crop yield.

Band steaming using Prototype II at Research Ctr Bygholm On the other hand robotic weeding and especially band-steaming (photo left) is expected to have great perspectives with respect to, e.g., outdoor cultivation of vegetables. Band-steaming and robotic weeding may decrease the operational costs by approximately 8.000 to 9.000 DKK per hectare in the production of carrot and sugar beet (1€ is approximately 7 DKK).
Such a reduction in operational cost is expected to increase the production and lower consumer prices of labour-intensive organic vegetables.

The new technologies only seem to reduce the cost on specialised crops. It was therefore not been possible to identify new technologies, which generally will lower the production costs in organic crop production significantly.

Restrictive regulation

At the beginning of the project some possible changes in legislation was described. These changes are still discussed in relation to organic farming in Denmark.

One for these changes is a ban on conventional manure on organic farms. This change will have different effects on the case-farms and will have a significant negative effect on the profitability of the crop producers. These farms will loose approximately 70.000 to 100.000 DKK, while the dairy farms increase their profit by about 100.000 to 200.000 DKK.

The band of conventional manure import increases the difference in earnings between organic dairy and arable farmers. The exact opposite is the case when restricting the use of straw. Such an initiative would increase the profitability of the crop producing case-farms by 0 to 15.000 DKK while lowering the economic outcome slightly on some case-farms with animals.

Finally, the import of conventional feed is worth approximately 98.000 DKK at the case-farm raising pigs. Restricting the use of manure and feed affects the profitability of the pork and crop producing case-farms negatively, and therefore some sort of compensation is needed either as higher prices or as increased subsidies. Without further support more restrictive legislation will lead to a further decrease in the total organic area. In the calculations it has not been assumed that the product prices will increase due to changes in legislation.

The research presented in this article is part of the DARCOF-II project entitled: Economic analyses of the future development of organic farming - Effects at the field, farm, sector and macroeconomic levels.

Reference

Nielsen, V., Sørensen, C. G. & Mortensen, H. S. (2003): Scenarieanalyser vedr. driftsteknisk indsats i økologisk jordbrug [Scenario analysis concerning labour and machinery input in organic farming]. Internal Report no. 188, Danish Institute of Agricultural Science. Bygholm.