Structural Change in Livestock Farming: Research from Finland and the other Baltic littoral countries : Doctoral Dissertation

Livestock production has been shifting towards larger production units, with the number of small livestock farms rapidly decreasing as a result. This dissertation examines the impact of this structural change in Finland and Northern Europe as it affects agricultural land use. The work comprises three substudies as well an introductory synopsis. It contributes to the literature through insights into the possible side-effects of the structural development studied, which highlights issues that deserve special attention. In most instances, efforts to achieve economies of size account for past and ongoing growth in farm size: Farms seek possibilities to gain efficiency and productivity in order to keep their viability in the face of growing production costs. In the case of Finnish dairy farms, increased productivity is mostly attributable to advances in technology. Average technical efficiency has increased but only slightly; more importantly, a higher share of the total production volume is produced with higher technical efficiency. One factor affecting the technical efficiency of dairy farms is parcel structure, that is, the size of and distance to field parcels. Improving parcel structure would thus be an appropriate measure in the effort to improve technical efficiency. One alternative to high-intensity production that has been put forward is a strategy based on low input use. In the northern European context, clover-grass-based forages are suitable for sustainable low-input or organic dairying. They are advantageous in that they require less nitrogen fertilization than pure hay grasses yet provide a higher protein content for livestock. While any incentive to cultivate clover-grass was found to be highly dependent on the price of nitrogen, increasing the yield of clover-grasses (i.e., decreasing the gap in yield vis-à-vis intensive grass production) would also effectively promote clover cultivation. Significantly, this would not entail additional costs for milk producers or society, a finding arguing for encouraging the development of clover varieties and cultivation practices. Yet, the potential for clover-grass was found to be limited due to the excessive quantity of manure nitrogen at average dairy farm stocking rates. As livestock farms that continue to operate are growing larger and housing more animals, effects can be expected where the use of manure is concerned. The crux of the issue is the nutrient composition of manure: By the year 2030, farms housing more than 500 livestock units will likely produce more than two-thirds of all manure phosphorus, whereas the proportion in 2010 was one-third. This development would induce a need for growing farms to acquire 4.9 million hectares of land from exiting farms in order to meet the current manure spreading requirements. This shift represents 64% of the total area available for spreading in 2010 and 15% of the total utilized agricultural area of the regions studied. The results suggest that despite it being economically justified to seek economies of size in agriculture, contrasting and/or countervailing tendencies can be identified that are related to land management. These tendencies 1) reduce efficiency, 2) limit cultivation opportunities and 3) lead to the concentration of nutrients on fewer farms. Structural development – livestock farms becoming larger – creates pressure to develop new nutrient solutions. An awareness of these issues is crucial when agri-environmental policies are developed. The present research indicates that it is justified to promote land-use efficiency in livestock farming through farm consolidation programs and by promoting cooperation between farmers. It is also advisable to enact manure nutrient regulation in the supranational context.

2020