Options for reforming agricultural subsidies from health, climate, and economic perspectives

Agricultural subsidies are an important factor for influencing food production and therefore part of a food system that is seen as neither healthy nor sustainable. Here we analyse options for reforming agricultural subsidies in line with health and climate-change objectives on one side, and economic objectives on the other. Using an integrated modelling framework including economic, environmental, and health assessments, we find that on a global scale several reform options could lead to reductions in greenhouse gas emissions and improvements in population health without reductions in economic welfare. Those include a repurposing of up to half of agricultural subsidies to support the production of foods with beneficial health and environmental characteristics, including fruits, vegetables, and other horticultural products, and combining such repurposing with a more equal distribution of subsidy payments globally. The findings suggest that reforming agricultural subsidy schemes based on health and climate-change objectives can be economically feasible and contribute to transitions towards healthy and sustainable food systems.

A New Algorithm for Extracting Winter Wheat Planting Area Based on Ownership Parcel Vector Data and Medium-Resolution Remote Sensing Images

In the complex planting area with scattered parcels, combining the parcel vector data with remote sensing images to extract the winter wheat planting information can make up for the deficiency of the classification from remote sensing images simply. It is a feasible direction for precision agricultural subsidies, but it is difficult to collect large-scale parcel data and obtain high spatial resolution or time-series remote sensing images in mass production. It is a beneficial exploration of making use of existing parcel data generated by the ground survey and medium-resolution remote sensing images with suitable time and spatial resolution to extract winter wheat planting areas for large-scale precision agricultural subsidies. Therefore, this paper proposes a new algorithm to extract winter wheat planting areas based on ownership parcel data and medium-resolution remote sensing images for improving classification accuracy. Initially, the segmentation of the image is carried out. To this end, the parcel data is used to generate the region of interest (ROI) of each parcel. Second, the homogeneity of each ROI is detected by its statistical indices (mean value and standard deviation). Third, the parallelepiped classifier and rule-based feature extraction classification methods are utilized to conduct the homogeneous and nonhomogeneous ROIs. Finally, two classification results are combined as the final classification result. The new algorithm was applied to a complex planting area of 103.60 km2 in central China based on the ownership parcel data and Gaofen-1 PMS and WFV remote sensing images in this paper. The experimental results show that the new algorithm can effectively extract winter wheat planting area, eliminate the problem of salt-and-pepper noise, and obtain high-precision classification results (kappa = 0.9279, overall accuracy = 96.41%, user’s accuracy = 99.16%, producer’s accuracy = 93.39%, commission errors = 0.84%, and omission errors = 6.61%) when the size of ownership parcels matches the spatial resolution of remote sensing images.

The Slope Association Type as a Comparative Index for the Evaluation of Environmental Risks

The topography is one of the determining site characteristics, of which the slope inclination is significant for natural science aspects, including the estimation of water erosion risk and as a criterion for agricultural subsidies. The slopes within an area vary greatly and occupy very different proportions of the area. Algorithms that take this heterogeneity into account were developed in the 1970s with the medium-scale agricultural site mapping (MMK). It also contains the slope association types (SAT, in German: “Hangneigungsflächentyp”), which classifies different slopes and summarizes them as one value per reference area. The SAT can be used across various scales and different targets. Applicability is given to soil and water conservation tasks, administrative tasks as field selection or agricultural subsidies, and over a wide range of scales from small catchments areas to whole landscape analyses. Thus, one value on an area basis characterizes an important topographic factor.

Front-Loading Agricultural Subsidies: Quantifying Public Savings

Reforms to agricultural policy have been stalling in OECD economies. In this paper, we quantify the potential for public savings from switching to an optimal transfer system in small open economies. Following the insights from the literature on repeated moral hazard, optimal subsidies are front-loaded, which provides stronger incentives for farmers to transition out of agriculture, compared to the existing policies. In our counterfactual experiments, we find government savings of 6% for Chile, 45% for Japan, 24% for Switzerland, and 51% for Turkey. In addition, optimal subsidies more than double the speed of the transition of employment out of agriculture.

State-led agricultural subsidies drive monoculture cultivar cashew expansion in northern Western Ghats, India

Agricultural commodity production is an important source of livelihood for farmers but is a major driver of tropical deforestation and biodiversity loss. While the socioecological effects of agricultural commodities such as palm oil, cocoa and coffee have been well studied, the effects for other commodities such as cashew (Anacardium occidentale) have received less attention. Global cultivated area for cashew increased rapidly from 526,250 ha in 1980 to ~5.9 million ha in 2018. India is the world’s second largest cashew producer, with cashew farms often occurring adjacent to ever dwindling cover of remnant forests. To mitigate cashew expansion at the expense of forests, it is necessary to understand land use policies that drive the expansion of cashew cultivation and the land management practices in present-day cashew farm systems. Through semi-structured interviews (n=65) and a literature review on agricultural policies in India, we evaluated the role of state-led land use policies in cashew expansion and characterised present-day cashew farming systems in the Sawantwadi-Dodamarg landscape in a biodiversity hotspot in northern Western Ghats. Agricultural subsidies introduced from 1980 to 1990 encouraged cultivar cashew expansion and influenced land use conversion from rice and privately owned forest to cashew. Farmers grew a mix of common and cultivar cashew but the latter was preferred as they produced high yields over short duration, even though they required agrochemical inputs and are more susceptible to pests and wildlife-induced losses. About 80% of farmers had cashew farms that were planted over forests in the past 30 years and expressed interest to continue forest clearing for cultivar cashew expansion. Although farmers incurred high losses from crop depredation on cultivar cashew, they avoided applying for government-sponsored compensation for these losses and chose to expand cultivar cashew into forested areas. Our study deepens the understanding of how government-led agricultural subsidies drive farmers’ uptake of cashew cultivars, farmers’ practices on cashew management, and how these factors at the state and farm level drive deforestation in this landscape. We recommend further research in cashew farming systems to devise sound conservation planning that is inclusive of stakeholders for the protection of privately owned forests and sustainability standards for the cashew industry.

DOES THE POLICY OF FINANCIAL SUBSIDIES FOR AGRICULTURAL INSURANCE CONTRIBUTE TO ENSURING FOOD SECURITY FOR POVERTY ALLEVIATION? EVIDENCE FROM CHINA

China’s current agricultural policy includes a wide range of agricultural subsidies, but the overall effect and levels of protection are low. China’s continued use of agricultural subsidies to ensure national food security is important in the context of global poverty alleviation. We examine the effect of agricultural insurance financial subsidy policies on food security using a difference-in-difference model with data from 285 Chinese cities from 1978 to 2019. These agricultural insurance subsidies have a significant positive effect on food security, with the most noticeable improvements in the northeast region. Reform and redesign of the subsidy system for greater flexibility and coverage are needed to safeguard China’s food security.

The Capitalization Effect and Its Consequence of Agricultural Support Policies—Based on the Evidence of 800 Villages in China

The theoretical and empirical results of the capitalization effect of agricultural support policies on land rental price remain inconclusive. Based on the survey of Chinese Household Income Projects in 2007 and 2008, this paper adopts the panel data of 800 villages in 11 provinces in China to empirically analyze the impact of agricultural support policies on village-level land rental price. It shows that both output price support and agricultural subsidies have a significant positive effect on land rental price in the village. For each 1 CNY/kg increase in output price support, the land rental price in the village will rise by about 322.44 CNY/mu, while with an additional 1 CNY/mu increase in agricultural subsidies, it will increase by CNY 0.45. The stronger the social relationships in the village, the less area of land transfer for a fee and the lower the land rental price. For villages with weak social relationships or renting land to outsiders, output price support and agricultural subsidies can significantly increase the land rental price. Output price support and agricultural subsidies not only have a significant positive effect on the area of land transfer in the village but also an indirect negative effect on it by raising the price of regional land rent.

EU’s CAP objectives are far from guaranteed

Significance The overarching objectives of the reforms are to align agricultural subsidies with the Commission's broader agenda to tackle climate change. The new reforms also prioritise protecting small farms and equalising the distribution of payments across the bloc. The agreement has come under criticism from both farmers and environmentalists. Impacts The proposed spending is unlikely to be enough given the technology and funds required to transition to green farming practises. There is no new requirement to reduce livestock numbers, but governments can pay farmers to do this under existing and new schemes. The diversification of farming activities could attract more young people to stay in, or move to, rural areas.

Evaluating Risk and Possible Adaptations to Climate Change Under a Socio-Ecological System Approach

Evidence suggests that climate change could drastically reduce Mexico's agricultural productivity with severe socio-ecological consequences. Population growth and the increasing demand of resources will exacerbate these impacts. Focusing on rainfed maize production, we evaluate the socio-ecological risk that municipalities currently face and how climate change could modify it. Municipalities were classified based on their biophysical and socioeconomic traits like temperature, precipitation, population, gross domestic product, marginalization, and agricultural subsidies. The study identifies municipalities that would face higher risk under climate change conditions, and it evaluates whether increases in agricultural subsidies could be effective for reducing the farmers' future risk. Our results show that during the 2010's, 36.8% of the municipalities and 15% of the population were at very high and high risk, respectively. By 2070, under a high-warming scenario these figures increase to 56.5 and 18.5%. We find that a generalized augment in agricultural subsidies is not enough to compensate for the effects of climate change on the socio-ecological risk of rainfed maize producers. We suggest that transformative adaptation is required for managing the agricultural risk that socio-ecological systems experience under climate change conditions. Such adaptation strategies should include poverty alleviation, promotion of resistant and native varieties of crops, capacity building to improve management and water use, sustainable technification, and soil restoration.