Agriculture and Ecosystem Services in the Tropics:
Theory and Practice
Joshua Farley
Community Development and Applied
Economics
Gund Institute for Ecological Economics
University of Vermont
With Abdon L Schmitt Filho,
Alfredo Fantine, Gisele
Alarcon
UFSC – University of Santa
Catarina, Florianopolis, Brazi)
Research funded by CNPq's
Pesquisador Visitante
Especial program
X Eugen Warming Lectures in
Evolutionary Ecology: Biodiversity and
Ecosystem Services in the Tropics – Now
and Beyond. Universidade Federal de
Minas Gerais, Belo Horizonte, MG, Brazil.
December 3, 2014
Planetary Boundaries and
Agriculture

Greatest
threat to
global
ecosystems
 Dependence
on nonrenewables
 Need to feed
growing
population
Essential and Non-substitutable
Resources

Food, water, energy, ecosystem services


Critical thresholds



Ecological
Physiological
Inelastic demand


Essential to human survival with no adequate
substitutes
Large changes in price with small changes in
quantity; small change in quantitylarge change
in price
Inelastic supply

Large changes in price have little impact on
supply
Substitution in Agriculture

Substituting non-renewable resources for
ecosystem services




Tractors for draft animals
NH3 and mined phosphorous for nutrient cycling
and legumes
Pesticides for biological controls
Tractors and agrochemicals degrade
ecosystem services
 Must restore ecosystem services before nonrenewables run out
Irreconcilable Thresholds?
Atlantic Forest Biome
• Second largest rain forest of South America, covering
most of the Brazilian coast
• Stretching over latitudinal 3oS to 30oS, altitudinal (0–
1,800 m), and climatic gradients (1,000–4,200 mm
annual rainfall)
• Extremely heterogeneous
(Scarano 2002, Camara
2003)
Atlantic Forest Biome
• 20,000 species of plants, 263 mammals, 936 birds,
306 reptiles and 475 amphibians (Mittermeier 2005,
Ribeiro 2011)
Atlantic Forest Biome
• Endemism rates ranging from 30% in birds to 44% in
plants (Mittermeier 2005)
Atlantic Forest Biome
• 245,173 fragments, 83,4% of are smaller
than 50 ha (Putz 2012)
• Habitat loss has reached more than 90% in
some centers of endemism (Ribeiro 2009)
•
Ecological research suggests that the extensive
deforestation of the Atlantic Forest has come at the cost of
system resilience, and the forest may fail to recover from
any new disturbances
(Mittermeier 2011)
Atlantic Forest Biome
• Ecological threshold at ~30% forest cover, beyond
which major extinction/extirpation events may occur
(Banks-Leite et al., 2014)
Ecological Threshold
 Island
biogeography: 90% decrease in
ecosystem size associated with 50%
decrease in species diversity (MacArthur & Wilson 2001).
 Significant time lags between forest loss
and extinction (Brooks & Balmford 1996)
 Strong potential to transition to new
ecosystem

Brief window of opportunity for action
Brazil’s National Forestry Code

Mandatory conservation and reforestation of
critical ecosystems


Area of Permanent Preservation (APP)




Partial amnesty after 2012
30 (up to 500) meters alongside rivers
20 – 100 meters around springs, reservoirs, etc.
Steeps slopes and hilltops
Legal Forest Reserve for AF 20% of
remaining property
Typical Farm
98% of Forest remnants
On private proprieties
87% of the properties belong
to family farmers
Santa Catarina’s family farmers
• Produce 87% of agricultural
output on 44% of land
• Comprise 90% of rural
population - 180 thousand
families
Santa Catarina state – family farmers livelihood
• 88 % are land owners
• 61% have less than 40
hectares
• Rural-urban migration
important issue
Economic Threshold, short term
 Compliance
with forestry code would leave
many farms nonviable
Economic Threshold, long term
 Loss
of ES essential to agriculture
 Catastrophic flooding, infrastructure loss
 Extensive erosion, etc., etc.
Current “Solution”
 Effects
of poverty immediate, of
deforestation delayed
 Santa Catarina’s governor: Choice
between “crops or slums”

Declared state forestry code allowing greater
deforestation (Souto 2009)
 Spurred
national debate and change of
forest code
Agroecology as a Better
Solution
 Reduce
use of off-farm, non-renewable
inputs


Lower costs hence lower risk
Less ecological degradation
 Greater

diversity
Greater resilience, lower risk
 Improved
ecological benefits
Agroecology and Ecosystem Services
Outreach Programs at The University of Santa Catariana UFSC
1998-2015
Southern Brazil Voisin Grazing Program
The GPVoisin
Voisin Grazing Group – GPVoisin
Stage 0: Tabaco transitioning to
conventional semi-confinement dairy
Stage 1: Voisin rotational
grazing
Stage 1: Voisin rotational
grazing
 Higher
stocking rates, yields per cow, and
income
 Lower expenditures on inputs
 Less disease
 Less labor (after startup)
 Better quality of life
Stage 2: Hi-Biodiversity Silvopastoral
Systems and Ecosystem Services

Provide Shade and windbreaks
 Nucleation system
 Euterpe edulis (juçai), (bracatinga: nitrogen
fixation, timber, honey), other fruits and timber,
charcoal trees, etc.
 Wild bees
Juçara palm - Euterpe edules
Açai – Euterpe oleracea
• 50 islands ha - Non- timber forest product- NTFPs
• 12% of pasture area
• 24-36% of pasture shaded during summer
Stage 3: HBSPS, Agroforestry and
Payments for Ecosystem Services
 Goal
is to restore ecologically sensitive
zones with native species agroforestry
system
 Most farmers reluctant to comply with
forestry code, willing to do so for
compensation or with technical assistance
 Working with SDS on PES scheme in
collaboration with farmers
Comparing efficiency across
practice and policy
Economic Efficiency
Food Security
• Allocative efficiency
• Producing the right foods with
the right resources on the right
land
• Distributive efficiency
• Ensuring these foods go to those with the
greatest physiological need
• More equitable distribution of wealth?
• Alternatives to price rationing?
Poor
food security, household security
Shift from marginal
to total value (e.g.
diamond-water
paradox)
physiological threshold: e.g. starvation
Opportunity cost
Physiological Demand curve
Rich
Middle class
food security, household security
Price
Rich
physiological threshold: e.g. starvation
Market Demand curve
Poor
Food production (in calories/day/capita)
Economic Efficiency
• Agroecology
• More diverse
and healthier food
• Greater resilience
• Benefits poorest
farmers
• Conventional ag
• Low diversity for processed foods and export
• Low resilience
Economic
Efficiency
• Policy
• Fome zero
• PRONAF
• Programa de adquisição de
alimentos
• Premium for agroecological
production
Survey of Voisinista Farmers
 98%
of farmers stated investment was
generating the desired returns or more.
 85% claimed that the project improved
their quality of life
Economic Efficiency
Technical Efficiency
• Throughput broadly defined
•
•
Water, energy, fertilizers, labor, capital, land
Cannot rely on non-renewables
Technical Efficiency
• Agroecology
•
•
•
•
•
Voisin grazing increased milk production:
91% of farmers increased cows per hectare
90% increased yield per cow total yield and revenue
Lowered costs and inputs: 49% of farmers stated that
labor requirements decreased, while 27% stated they
had increased
Before adoption 73% of farmers used pesticides, 28%
over the entire pasture
After adoption fell to 54% and 3% respectively
Decrease in ticks, horn-flies (Haematobia irritans),
worms and mastitis, hence pesticides, medicines
Technical Efficiency:
Conventional ag
• Compared 3 maiz systems
•
•
•
Wind pollinated agroecological
Conventional hybrid
Genetically modified
• Results
•
•
•
•
•
Higher yield from conventional and GMO for wealthier
farmers
Subsidized
GMO uses as many pesticides as conventional
Brazil has highest use of pesticides in world, many
banned in other countries
Much lower costs, lower risks, higher profits, greater
resilience from agroeco
Technical Efficiency
• Requires major investments in R&D, extension
• Economics of information
•
•
Public funding Minimize costs, maximize benefits
Sharing knowledge
• Requires significant investments by farmers
•
•
•
Highest interest rates in world
High risk
PRONAF
Technical Efficiency
Ecological Efficiency
• Restoring ecosystem services
• Minimizing impact of throughput on
ecosystem service
•
•
•
•
Minimizing agrotoxins, fossil fuels, erosion
Accounting for non-market benefits
Open access and public goods
Cooperation required
Ecological Efficiency
• Agroecology
• 72% of farmers claimed that manure decayed
faster
• 85% claimed soil moister during droughts
• Areas with total vegetation coverage increased
from under 2% of pastures to over 72%
• Over 85% of farmers noticed improvement in soil
quality.
• Carbon sequestration
• Biodiversity
Ecological Efficiency
• Conventional agriculture
• Highest use of pesticides in world
• Many banned in other countries
• Fertilizers based on non-renewable resources
• Policy
• Subsidies for conventional ag and chemical inputs
• Forest code
• Threat of fines
• Payments for ecosystem services
• Riparian zone forests
• High transaction costs
• More cost effective on large farms
Ecological Efficiency
Ecological Efficiency
Next Phase: Agroforestry in the APPs
• Agroecology
• Substitutes ecosystem services for nonrenewable inputs
• Over 90% of farmers found that ticks, horn-flies
(Haematobia irritans), worms and mastitis all
decreased
• 72% of farmers claimed that manure decayed
faster
• 85% claimed soil moister during droughts
• Pasture with complete vegetation coverage
increased from 2% to 73%
• 85% of farmers noticed an improvement in soil
quality.
Farmer Attitudes towards Forest
Code

3 Clusters from surveys (n=60) of Voisin
farmers
 Perceptive farmers (i.e. aware of ecosystem
services) willing to restore APP (15%)
 Perceptive famers unwilling to restore (45%)
 Unperceptive and unwilling to restore (40%)
 Willing to restore with incentives



Payments for ecosystem services (PES)
Returns to agroforestry
Reduced threat of fines for non-compliance
Problems with PES
 Requires
political will to continue
indefinitely
 Does not finance adoption of agroecology


Extension
Investment costs
 High
transaction costs
 Dependent on prices

Corn prices and conservation reserve in US
 May
erode social economy
Policy Reform
 Publicly

funded RD&D
80% IRR
Alston, J.M., Marra, M.C., Pardey, P.G., Wyatt, T.J., 2000. Research returns redux: a metaanalysis of the returns to agricultural R&D. Australian Journal of Agricultural and Resource
Economics 44, 185-215.
 Public

investments in rural sector
Greater than 60% IRR in LA
López, R., Galinato, G.I., 2007. Should governments stop subsidies to private goods?
Evidence from rural Latin America. Journal of Public Economics 91, 1071-1094.
 Affordable,



low risk credit
Must design with farmers
Payment contingent on success
Rotating fund with zero interest
Economics of ES
 Market
rewards people for converting
ecosystems into economic products
 Few rewards for providing ecosystem
services, regardless of relative value