A Sustainable Agriculture for Europe? From Evidence to Policy Reform

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1 A Sustainable Agriculture for Europe? From Evidence to Policy Reform David Baldock Gulbenkian Foundation 5 November 2012

2 Agriculture and the environment Agriculture is the largest user of land in Europe and farming activities affect all the media soil, air quality, greenhouse gas emissions, water, fauna and flora etc. Both slow and rapid changes are occurring and the outcome can be attributed to the interplay of agricultural management with the natural environment This interplay is more complex than in many other sectors, will vary over time and between locations Natural systems are involved; variables such as climate are significant. Simple relationships are rare

3 Environmental challenges Source: EEA

4 European agriculture and the environment the pressures Widespread evidence of deterioration in environmental state over time, although some improvements in air quality, regional improvements in soil quality and reductions in GHG emissions European targets for water quality and biodiversity are being missed, soil quality is declining, agrochemical use is high and cultural landscapes are affected by intensification and abandonment The scale of this challenge is likely to be exacerbated by climate change; further emission reductions are required

5 EU biodiversity targets to halt the loss of biodiversity and the degradation of ecosystem services in the EU by 2020, restore them in so far as feasible, while stepping up the EU contribution to averting global biodiversity loss. Conservation status of habitats associated with agriculture across Member States (%) favourable FV; unfavourable-inadequate U1; unfavourable-bad U2; unknown XX

6 Biodiversity conservation objectives Natural habitats: Ensuring they are not damaged by agricultural activities (ie grazing & burning) ) in some cases stopping these Semi-natural habitats: Maintaining the habitat and associated beneficial practices Restoring rare and fragmented semi-natural habitats Agriculturally improved habitats: Avoiding, or reducing to acceptable levels, external impacts. Enhancing the habitat, especially in-field components (eg food resources in crops) by suitable management.

7 Agricultural drivers and intervening factors that affect biodiversity Agricultural drivers Specialisation, consolidation and mechanisation; Diversification; Intensification; Bioenergy markets; Abandonment; and Others (eg land use change, farm employment, organic production, etc) Intervening Factors Variations in climate and weather; The incidence of disease in crops and livestock; Intensive alien species; Habitat change outside Europe (affecting migratory species, for example)

8 Grassland butterflies population index

9 Water quality Despite improvements in some regions, diffuse pollution from agriculture remains a major cause of the poor water quality currently observed in parts of Europe. Source: EEA Agriculture contributes % of the total nitrogen load observed in Europe s freshwater, with point discharges, including from wastewater treatment plants, providing much of the remainder. SOER, 2010

10 State of soils in relation to Land Use data availability Little accessible data that links the EU soils data to land use and land cover Little comparable data over a consistent time series that would allow for a systematic historic evaluation of the state of soils in the EU-27 over time or to link the change in the state of soils with changes in land management practice LUCAS data might resolve some of these issues when it becomes available later in 2012.

11 Soil erosion by water About 7 per cent of cultivated land under arable and permanent crops in the EU-24, excluding Cyprus, Greece and Malta, suffer from a risk of moderate to severe erosion (>11 t/ha/yr) compared to 2 per cent of permanent grassland in the same Member States Areas at risk of soil erosion by water in the EU-27 Source: Agri-environmental indicator draft factsheet Soil water erosion (AEI 21)

12 Soil erosion under different land uses Mean value of soil erosion risk by water for agricultural areas Source: SoCo, 2009

13 Soil organic carbon levels ~ 60 million ha of soils with less than 2% of soil organic carbon are under intensively cropped agricultural land and approximately half of these soils are under arable or permanent crop management. GAEC management should target differently soils at risks of further decline of low SOM levels and soils at risk of high carbon losses in soils of high SOM levels. Share of agriculturally used soils with low organic carbon content per FARO region Source: EC, 2011, based on Agri-environmental indicator draft factsheet Soil water erosion (AEI 21)

14 Carbon rich soils and their uses 16 per cent of peatland is currently used for agricultural purposes (both for cropland and grassland) and drained In some Member States more than 70 per cent of peat soils are under agricultural use Poland (with peat soils mostly under grassland) and Germany (smaller proportion of peat soils under cropland and greater under grassland) are the countries with the highest area of peat soils under agricultural use Peat soil area in Member States with more than 400 ha of peat soils, including the breakdown for grassland and cropland Source: Gobin et al., 2011, adapted from Joostens and Clarke, 2002; Byrne et al., 2004

15 High organic matter content Topsoil organic carbon content in EU permanent grasslands SOM levels are higher in soils under permanent grassland than in identical soils under arable land Semi-natural grasslands, moorlands/ heathlands likely to be in organomineral category (20-30% SOM) Source: Gobin et al., 2011, adapted from Jones at al, 2003, Corine CLC, and Eurostat NUTS database

16 Categorisation of European soils according to carbon characteristics of soil types Organic soils >30% SOM in upper horizon Organic-mineral soils 20-30% SOM in u.h. Mineral soils SOM < 20% SOM in u.h. Source: The James Hutton Institute/Aitkenhead M, 2011

17 Soil functionality Source: EEA Europe's soils store about 73 to 79 billion tonnes of carbon. Some 45 % of soils in Europe have a low or very low organic matter content (meaning 0-2 % organic carbon) and 45 % have a medium content (meaning 2-6 % organic carbon). SOER, 2010

18 Greenhouse gas emissions Around 9.1% of EU GHG emissions, particularly N 2 O and CH 4 (methane) from EU livestock or 12.8%, if land use and land use change emissions in various countries included Of these about half, 323 million tonnes, from agriculture in Europe itself Could reduce emissions by around million tonnes of CO 2 equivalent p.a. according to JRC This would be achieved by better livestock housing, more efficient storage of manure and slurry, improved application systems for manure, urea substitution by ammonium nitrate fertiliser, some bio-gasification of slurry on large farms and reduced grazing Intensive systems often perform better in life cycle assessments of GHG emissions from livestock, so there can be conflicts with biodiversity and landscape conservation

19 Environmental public goods from agriculture Mike Hammett/CCW beehive365.eu Mike Hammett/CCW IEEP Farmland biodiversity; no wilderness in Europe Agricultural landscapes; cultural, aesthetic values High quality water, air and soils in certain areas Climate stability carbon sequestration in soils and reduced greenhouse gas emissions Resilience to fire and flooding arising from appropriate land management

20 The provision of public goods is not uniform The most beneficial farming systems for environmental public goods are: Extensive livestock and mixed livestock / cropping systems More traditional permanent crops Organic farming systems Potential for highly productive farming systems to adopt environmentally beneficial production methods / practices driven in part by new technologies. There can be trade-offs between the provision of different public goods, eg low carbon versus high biodiversity production.

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22 Influencing the farmed environment in Europe Trade Policy CAP Pillar 1, Pillar 2 Cross Compliance Environmental Regulation

23 Environmental regulations affecting agriculture Directives on the protection of fauna, flora and other habitats Directives on ammonia and other air pollutants Constraints on certain operations (eg ploughing) through zoning, environmental impact assessments Directives on drinking water, nitrate levels and the ecological status of freshwater Directives on pesticide use, residues and permissible levels in water Measures to constrain the use of GMOs

24 The principal EU measures for pursuing environmental goals within the CAP Cross compliance conditions attached to farmers direct payments Discretionary, regionally targeted cuts applied by EU Member States Voluntary measures in Pillar 2 of the CAP (supporting rural development and land management) Compensation payments to farmers for accepting environmental obligations (agri-environment measures) Aid for farming more mountainous Less favoured Areas Proposed new Greening measures, targeting 30 per cent of direct support to farmers under Pillar 1 of the CAP.

25 CAP Pillar 2 measurements Incentives for agricultural and rural development, environmental land management, forestry, special nature sites, LFAs, investment on farms, capacity building, Farm Advisory Systems, training Agri-environment measures provide incentives for farmers accepting obligations beyond the baseline set in law and in cross compliance (budget 5 billion per annum) Freedom for national authorities to formulate these obligations within very broad EU framework In nearly all rural development programmes there is some support for measures relating to organic farming, protecting grassland, lower input farming and biodiversity.

26 Pillar 2 measures agri-environment Critically important in pursuing biodiversity targets on farmland and associated wooded areas; Flexible for tailoring management to suit the particular combination of local factors (bio-physical, climatic, environmental and agronomic); Notable successes have been proved scientifically for birds, small mammals, invertebrates, plants. Some studies have established only varied impacts on biodiversity, however, interrogations continue to identify the factors involved; Raluca Barbu Ben Allen

27 CAP on agri-environment agreements with farmers Source: EEA

28 Addressing soil organic matter through cross compliance Objective of GAEC 6: to maintain steady state levels of soil organic matter content in all types of soil and prevent further decline in SOM. A thorough, comprehensive and well implemented GAEC 6 can be the basis for the protection of SOM levels in carbon rich soils (GAEC 7). Scope of GAEC 6 maintenance of SOM in all soils, but need to target specifically : the areas at risk of further decline of soils with low SOM levels; or the areas at risk of high carbon losses in soils with high SOM levels. Highest priority actions recommended for GAEC 6 in croplands: vegetative cover and cover crops, rotation (with or without legumes), minimum and no tillage regimes, incorporation of crop residues, maintenance of over-winter stubble and addition of organic matter (compost, manure etc). in grasslands: avoidance of overgrazing.

29 Targeting support to environmental objectives Requires adequate environmental economic data, monitoring, investment in institutional capacity Challenge of farmers resistance and administrative complexity One strategy is to adapt direct payments, adding new conditions etc, aiming at simplicity, limiting redistribution between farms and regions Another approach would be a more radical move to targeted payments based purely on cost of public goods provision by farms, accepting complexity and comprehensive change.

30 Goals for European agriculture Responding to the global challenge of producing more from less An agriculture that is sustainable and more resilient to climate change And contributes more to environmental challenges, eg cutting GHG emissions and halting biodiversity decline by 2020 Which requires appropriate farm and forest management So policy must balance sustainable production with public good provision This is where the world needs EU leadership, rather than in a primarily productivist vision of food security.

31 Components of a sustainability agenda Increased institutional capacity Engagement with consumers and food supply chain Innovation and technology development Engagement with farmers; advice, info, support Clear baseline and monitoring regime Environmental policy; measures and implementation Sufficient funding and confidence in its continuation Supportive Trade Policy Clear objectives and Well Designed CAP EU Level Engagement

32 Challenges for a CAP delivering public goods Diversity of agriculture Variations in farm viability CAP Budget rules and politics Unpredictable commodity prices Cultural change Picture Avoiding excess complexity and admin Increased institutional demands Incomplete data and monitoring

33 Greening the CAP Is essential both for farmers and the environment and should be as effective as possible Pillar 1 is not the first choice solution - ideally, policy measures in Pillar 2, especially agri-environment, should play a much larger role BUT there are limits to what it can achieve due to: Voluntary nature Limited funding availability in Pillar 2 Lack of support for increasing Pillar 2 budget reluctance to increase Member State co-financing Greening of Pillar 1 engages nearly all farmers and reaches across the farmed landscape, so has real potential. Placing measures in Pillar 1 means some compromises are unavoidable, for example on the rules required - neither too simple or too complex Ben Allen Natural England

34 Greening measures: potential environmental benefits Ecological Focus Areas likely to deliver the greatest benefit Not the same as set-aside; Negative production effects are overstated; Long term food security depends on the sustainable management of the resource base, particularly in face of future climate challenges. Permanent Grassland A simple measure, with potential eg for protecting carbon storage; Focuses on maintaining grassland area, not protecting or enhancing its ecological quality. Crop Diversity Increased benefits are likely if it encourages greater crop rotation, including fallow or legumes. Natural England Guy Beaufoy Yann Desjeux

35 Greening should also include Protecting and enhancing the role of Pillar 2: No further erosion of the EAFRD budget Inclusion of the 25% earmarking of EAFRD funds for climate and environmental land management activities within the legislative text Removal of the possibility for 12 Member States to transfer funds from EAFRD to Pillar 1 Effective implementation and enforcement of cross-compliance; Improved implementation of environmental legislation The CAP can help an essential transition; Adopting a vision of a truly sustainable European agriculture with a market as well as environmental benefit. Yann Desjeux beehive365.eu BirdLife (Stefan Benko) Mike Hammett/CCW

36 Progress in the Commission proposals Improved objectives for CAP, although more explicit emphasis on public goods would be desirable Recognition of: Scale of challenge ( 12.5 billion p.a. for greening Pillar 1) Need for bolder intervention, eg EFAs Expanded role for cross compliance Importance of innovation Expansion of monitoring into Pillar 1 Addressing new priorities in Pillar 2, pursuing flexibility, landscape scale measures etc.

37 Package weakened by Frozen Pillar 2 budget, with enlarged menu of options Open door for reverse modulation Lack of earmarking of RDP funding for agrienvironment / land management Constraints on design of Greening measures (eg management and control rules) narrows choice, could restrict tailoring No measure to incentivise lower intensity grazing, eg for HNV farms Lack of deadline for including water framework and pesticide directives in cross compliance

38 Greening Essential to maintain linkage with receipt of basic payment Important to enable appropriate tailoring to local conditions, without creating excessive elasticity Some hazards: Double funding and setting criteria for assessing equivalence Uncontrollable tide of inadequate green certification schemes EFAs weakened by smaller percentage of area, inappropriate definitions, exclusion of existing features

39 The opportunity There is a political window within which the CAP can be refocussed, secure a new rationale and build a wider constituency for the future This opportunity should not be wasted Some policy design questions are not simple or straightforward but they can be resolved The measures must correspond to the messaging; greenwash would be a travesty and recognised as such The Commission in particular must be firm in this respect.

40 Thank you! Any questions?