Modelling the economics of agroforestry at field- and farm-scale
García de Jalón, S., Graves, A.R., Palma, J.H.N., Crous-Duran, J., Giannitsopoulos, M., Burgess, P.J. (2017). Deliverable 6.18 (6.3): Modelling the economics of agroforestry at field- and farm-scale. AGFORWARD project. 13 October 2017. 85 pp.
This report (Deliverable 6.18) assesses the economics of agroforestry systems at field- and farm-scales and compares them with alternative land uses such as arable cropping, pasture and forestry. This analysis is undertaken in terms of financial profitability (e.g. from a farmer perspective) and economic benefits (e.g. from a societal perspective).
The report starts with the context and objectives (Section 1) and a description of the methodological framework (Section 2).
Section 3 describes the Farm-SAFE Microsoft Excel-based spreadsheet model that can be used to evaluate the financial and economic costs and benefits of arable, forestry and agroforestry systems. Within the AGFORWARD project it has been updated to allow the quantification and comparison of environmental externalities. The financial benefits and costs of alternative arable, silvoarable, and tree monoculture systems are described for i) poplar and arable systems in Bedfordshire, UK, ii) cherry trees in Schwarzbubenland, Switzerland, iii) a short rotation coppice poplar system in Neu Sacro, Germany, iv) an apple tree system in Cambridgeshire, UK, v) a holm oak system in Extremadura, Spain, vi) walnut trees at Restinclières in France, and vii) willow short rotation coppice in Suffolk, UK. In order to undertake the analysis, the Farm-SAFE algorithms were coded in the “R” software language which can support the calculation of economically optimal tree rotations (Section 3.2). Section 3.3 describes the inclusion in the model of environmental externalities such as greenhouse gas (GHG) emissions and sequestration, soil erosion losses, and nonpoint-source pollution from fertiliser use. Section 3.4 explains the implications of including some of these externalities in the assessment of the economic benefits of the poplar system in Bedfordshire in the UK and for the cherry system in Schwarzbubenland, Switzerland.
Section 4 includes a pre-submission copy of a published paper entitled “Modelling and valuing the environmental impacts of arable, forestry and agroforestry systems: a case study”, that has been published in Agroforestry Systems. The paper compares the economic benefits and costs of an arable, silvoarable and forestry system in the UK, including carbon sequestration, soil erosion control, and regulation of nitrogen and phosphorus losses. The results showed that the arable system was the most financially profitable land use but produced the most negative externalities. The silvoarable system whilst more profitable than the forestry system also produced negative externalities. The inclusion of the economic value of greenhouse gas emissions, carbon sequestration and loss of soil, nitrogen and phosphorus showed that silvoarable systems provided a similar societal benefit as the arable system, and a greater benefit that the forestry system. The assumed expense of removing nitrogen and phosphorus in freshwater meant that these cost were particularly high in the arable system. The results showed that planting trees in arable systems could potentially reduce nutrient surpluses and provide a large economic benefit to society.
Forage-SAFE is a model that simulates the daily balance between the produced and demanded food for livestock in a wood pasture system to estimate annual farm net margins. Section 5 provides a brief description of the Forage-SAFE model in the form of a paper which was presented at the 15th International Conference on Environmental Science and Technology in Rhodes, Greece between 31 August and 2 September 2017.
Section 6 describes the results of a methodology developed to up-scale farm-level results to the regional level, using a case study focused on soil erosion in Britany in France. The results show that increasing tree cover in treeless areas on pasture, but particularly on arable land, could provide significant economic benefits when externalities are evaluated at a regional level.
Lastly Section 7 provides a synthesis of the above.