1 Agricultural Sustainability Cathal O’Donoghue Teagasc Rural Economy and Development Programme

2 Overview Agriculture and Hunger Globally Agriculture and the Environment Biofuels Biotechnology Agriculture in Ireland Sustaining Farm Livelihoods

3 Feeding the World

4 Malthusian catastrophe  Return to subsistence once population growth exceeds agricultural productivity growth - Malthus (1798), An Essay on the Principle of Population Source UN

5 Percentage Under-nourished Despite increasing World Population  Falling Percentage Under- nourished Agricultural Revolution Green Revolution  Science based growth  2%+ cereal yield growth per annum Source FAO

6 Future Population Growth However  Population continues to rise  More people – 6.5 to 9 billion people by 2050  More food production – need to double grain production by 2050  Continued pressure Source UN

7 World Population 95% of World Population Growth in Developing World Source UK Food Futures

8 Declining Yield Growth Yield growth declining  Soil deterioration due to overuse of chemicals and industrial pollution  Biggest gains already achieved Source USDA-ERS

9 Declining Hectares per Capita Although number of hectares of cultivated arable land increased by 10% , Per Capita land halved. UK Footprint – 5.4 ha pp China Footprint – 0.5 ha pp Source UK Food Futures

10 Global Food Price Index Food Crisis 2008  Price Spike due to  Economic Growth  Low cereal stocks due to bio-energy  Drought  Speculation  Policy – export bans Price Spike 2010  Just starting  Russian stop exports of grain Source FAO

11 Under-nourished Resulted in large increase (150m) in under-nourished  Markets and Scientific Innovation take time to meet market needs  Will we see a return in 2011? Source FAO

12 Food Price Spikes = Civil Unrest Higher Prices  More Riots and Civil Unrest Source IFPRI

13 Where are the hungry? Most Hungry in Asia Higher Proportion in Africa - Under nourishment not only about production of food – Distribution, affordability and access to food also important!! - Sen’s Poverty and Famines: An Essay on Entitlement and Deprivation (1981) - Under-nourishment still a major world issue ! Source FAO

14 Other Pressures Nutrient Transition  More wealth – more meat  Obesity and Malnutrition in same countries  Food Waste – US wastes 27% of food – enough to feed 80 million people

15 Agriculture and the Environment

16 The scale of warming depends on emissions: Low scenario 1.1 – 2.9 o C Best estimate 1.8 – 4.0 o C High scenario 2.4 – 6.4 o C IPCC (2007) By 2100 Global Temperature is likely to be 1.8 to 4oC Above 1990 Level Global Temperature

17 Impacts of climate change 1°C2°C5°C4°C3°C Sea level rise threatens major cities Falling crop yields in many areas, particularly developing regions Food Water Ecosystems Risk of Abrupt and Major Irreversible Changes Global temperature change (relative to pre-industrial) 0°C Falling yields in many developed regions Rising number of species face extinction Increasing risk of dangerous feedbacks and abrupt, large-scale shifts in the climate system Significant decreases in water availability in many areas, including Mediterranean and Southern Africa Small mountain glaciers disappear – water supplies threatened in several areas Extensive Damage to Coral Reefs Extreme Weather Events Rising intensity of storms, forest fires, droughts, flooding and heat waves Possible rising yields in some high latitude regions Source IPCC

18 Land Cover Only 23% of arable land suitable for rain fed agriculture Limited capacity for extra cultivated land – need yield growth to increase production

19 Climate induced percentage change in production in 2050: Rainfed maize Source: IFPRI Climate Change: Global production: -16%

20 Water Scarcity /3 of the world’s population live in basins that have to deal with water scarcity Source: Comprehensive Assessment of Water Management in Agriculture, 2007 Significant Water Pressure 1kg Meat – 15m 3 water 1kg Grain – 0.4-3m 3 water More food production – need to double grain production by More water for food – if practices don’t change, water needs double Irrigation important however much water is not drained from sustainable sources (e.g. groundwater)

21 Biofuels

22 Food and Energy Food and Energy Prices linked  As input to food production  As a substitute for oil Bioenergy crops Source: IFPRI

23 Bio-fuel consumption High oil price (Plus subsidies)  Land use change to increase bio- fuel production Objective – reduce Carbon Emissions via sequestration when growing However  Land use change, fertiliser use and other energy inputs may result in higher emissions than fossil fuels Substitution of land from food and feed reduce food supply and can increase world food prices Waste from Forestry and Animal processing more efficient in Ireland Source UK Food Futures

24 Biotechnology

25 Biotechnology Selective Breeding  1000’s of years improving breeding Genetic Analysis - Genomics  Understanding traits associated with genetics can lead to improved breeding and performance Genetic Modification  Specific changes introduced into their DNA by genetic engineering techniques

26 Genetic Modification Pest Resistance  Reduces need for pesticides Herbicide Tolerance  Reduces costs associated with weeding Cold Tolerance  Resistant to frost Water Tolerance  Allow for higher crop yields in areas of higher or low moisture levels

27 Genetic Modification Concerns  Cross-contamination  Uncertainty and risk in relation to health due to relative recent introduction  As technologies are patented, there is a shift from public good provided research to profit making, increasing economic strength of multi-nationals Currently not grown in Ireland  However GM products used in many food stuffs  GM Maize grown in 7 EU countries – Spain has biggest share

28 Agriculture in Ireland

29 Agri-Food in Ireland Relatively small primary sector ~ 2.5% GDP However important component of processing sector ~ 7% Main Sectors  Beef, Dairy, Sheep, Pigs, Tillage  Most food exported Agri-food and bio-economy sector a major source of net export earnings  Given largely Irish ownership with profits kept in Ireland,  Better domestic connectivity and so fewer imports,  16% of exports, BUT 32% of net earnings (Riordan, 2008)

30 Family Farm Income Family Farm Income by Sector Market Power? Economic Issues in Agriculture Cost Price Squeeze Source: Teagasc National Farm Survey Source: CSO

31 Animal Production and the Environment Climate change – minor to positive impact on Irish Agriculture Agriculture can also impact on environment.

32 Contribution to GHG’s

33 Agriculture a Significant Contributor

34 However Global Food Security  Should Ireland reduce agricultural output? Carbon Leakage  If we reduce, will there be any positive impact if more rainforest is converted to food production? Incidence of Emissions  Production or  Consumption On-farm mitigation measures  Relatively low stocking rate  more intensive agriculture combined with new forestry  However cannot currently offset land use changes against agricultural emissions

35 Marginal Abatement Cost (Economy) And target the many options where negative or low marginal abatement costs exist Many other less costly (and beneficial) remedies should be exploited before reducing herd Source: McKinsey/SEAI

36 Nitrogen Nutrients required for sustainable agricultural production However, Excess nutrients in soil (fertiliser and/or manure) can have negative implications for water quality and climate change (N2O)

37 Fertiliser Use - N Fertiliser Use - P Reduced Fertiliser Usage

38 Farm Interventions Source: Teagasc National Farm Survey Average Investment on Farms as a % of Farm Income Proportion of Farms in REPS Prohibited Periods Significant policy induced interventions - Investment in Facilities - REPS - Calendar Farming - Nitrates Directive

39 Sustaining Farm Household Incomes

40 Viable Farms without subsidies (Farm Income > Min Ag Wage + 5% Return on Assets) Declining proportion (40% in 1996 to 19% in 2009) of farms are viable - ie can generate income equivalent to minimum agricultural wage ~ €17.5k + 5% return on Assets - A further 40% are sustainable with off-farm employment - Without subsidies like NZ, less than 2% of farms in 2009 (7% in 2008) would have been viable - A further 52% are sustainable with off-farm employment

41 Farm Viability Viable Sustainable Income Challenged Viable Comprises  25%  43% Dairy, 30% Cattle, 15% Sheep, 11% Tillage  13% over 65  Commercial end of sector  On-farm business needs Sustainable Comprises  35%  11% Dairy, 65% Cattle, 17% Sheep, 7% Tillage  5% over 65  Multi-income sources  On-farm and Off-farm needs Income Challenged Comprises  40%  25% Dairy, 53% Cattle, 16% Sheep, 6% Tillage  41% over 65  Severe Income issues  Income Generation Needs

42 Thank You!