Economics of silvoarable agroforestry - INRA Montpellier

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Economics of silvoarable agroforestry - INRA Montpellier

Economics of silvoarable agroforestry Paul Burgess 1 , Anil Graves 1 Fabien Liagre 2 & Christian Dupraz 3 1 Cranfield University, Silsoe, Bedfordshire, UK 2 Assemblée Permanente des Chambres d’Agriculture, Paris, France 3 INRA, Montpellier, France


Content 1. Investment and labour 2. Cash flow and discount rate 3. Development and validation of a European biophysical and economic model 4. Economic analysis for a range of tree species and climates in Europe


1. Investment and labour: establishment costs • Cost per tree higher than forestry due to marking up and tree protection • Cost per ha lower due to low tree density


Example of investment costs in France: no tree payments Poplar Cherry Forestry 113 trees/ha 50 trees/ha Walnut 0 500 1000 1500 2000 Establishment costs (€ ha -1 )


Example of investment costs in France: with tree payments Poplar Cherry Forestry 113 trees/ha 50 trees/ha Walnut 0 500 1000 1500 2000 Establishment costs (€ ha -1 )


Labour requirements • Understorey management • Tree pruning


Labour requirement walnut agroforestry in France: 120 trees ha -1 Labour required (hr/ha/a) mps de travail /ha/an) 16 14 12 agriculture Agriculture cultures Silvoarable intercalaires crop arbres Silvoarable tree 10 8 6 4 2 0 1 6 11 16 21 26 31 36 41 46 année


Labour requirement walnut agroforestry in France: 50 trees ha -1 Labour required (hr/ha/a) mps de travail /ha/an) 16 14 12 agriculture Agriculture cultures Silvoarable intercalaires crop arbres Silvoarable tree 10 8 6 4 2 0 1 6 11 16 21 26 31 36 41 46 année


2. Cash flow and discount rate Undiscounted cash flow for cherry forestry, a wheat/wheat/ grain maize system and a silvoarable (113 trees ha -1 ) system in Eastern France 50000 Cumulative cash flow (€ hā 1 ) 40000 30000 20000 10000 0 -10000 Arable Silvoarable Forestry 10 20 30 40 50 60 Time from planting (a)


Effect of discount rate of net present value of silvoarable, agricultural and forestry systems with poplar in southern France Net present value € ha -1 ) 15000 10000 5000 0 Silvoarable Arable Forestry 0 2 4 6 8 Discount rate (%)


3. Development and validation of a European biophysical and economic model


Development of a biophysical and economic model of forestry, agricultural and silvoarable systems Plot-SAFE Farm-SAFE Biophysical model Yield-SAFE Biophysical data Plot-scale economic model Farmscale economic model


Model validation: relative crop yield with poplar agroforestry in the UK 1.0 Relative crop yield 0.5 0.0 0 10 20 30 Time from planting (a) Relative arable yield Yield-SAFE prediction Silsoe measurements Leeds measurements


Model validation: timber volume per poplar tree in the UK Timber volume (m 3 tree -1 ) 2.0 1.0 0.0 0 10 20 30 Time from planting (a) Yield-SAFE prediction Silsoe measurements Poplar: yield class 13


. Plot- and farm-scale economic analysis for a range of tree species and climates in Europe


Mediterranean climate: no grants 800 600 400 200 0 -200 Agroforestry most profitable Spain means of establishing France oak and stone pine landscape, and almost as profitable as arable systems ALC1 ALC2 TOR1 TOR2 OCA1 ALM1 ALM2 CAR1 CAR2 FON1 OLM2 OLM3 CAM2 PAR1 PAR2 PAR3 FON2 OLM1 CAM1 Equivalent annual value (4% discount rate) (€ ha -1 a -1 ) Holm oak Stonepine Arable Silvoarable Forestry


Mediterranean climate: 2005 grants 800 600 400 200 0 -200 Current grants, where available, Spain tend to favour forestry France relative to agroforestry ALC1 ALC2 TOR1 TOR2 OCA1 ALM1 ALM2 CAR1 CAR2 FON1 OLM2 OLM3 CAM2 PAR1 PAR2 PAR3 FON2 OLM1 CAM1 Equivalent annual value (4% discount rate) (€ ha -1 a -1 ) Holm oak Stonepine Arable Silvoarable Forestry


Atlantic climate (no grants) 800 600 400 200 0 -200 Agroforestry with walnut most Spain profitable system in all France areas, and with poplar and cherry in some areas CMD1 CHT2 CHT4 FUS1 FUS3 SAN1 SAN3 SAN4 CMP1 DMP1 DMP2 VIT1 CMD2 CHT1 CHT3 CMP2 FUS2 SAN2 DMP3 VIT2 Equivalent annual value (4% discount rate) (€ ha -1 a -1 ) Wild cherry Walnut Poplar


Atlantic climate (2005 grants) 800 600 400 200 0 -200 Agroforestry with walnut and poplar most profitable system Spain CMD1 CHT2 CHT4 FUS1 FUS3 SAN1 SAN3 SAN4 CMP1 DMP1 DMP2 VIT1 CMD2 CHT1 CHT3 CMP2 FUS2 SAN2 DMP3 VIT2 Equivalent annual value (4% discount rate) (€ ha -1 a -1 ) Wild cherry Walnut Poplar Arable Silvoarable Forestry


etherlands: comparison of silvoarable, arable and forestry systems on livestock farms a) No grants 800 b) 2005 grants Spain France Equivalent annual value (€ ha -1 a -1 ) 400 0 -400 -800 -1200 Agroforestry less profitable than the arable system assuming current payments Walnut Poplar Poplar Walnut Poplar Poplar


Farm-scale analysis (2005 grants; 4% discount rate) Agroforestry more profitable than forestry Agroforestry more profitable than agriculture Proportion of cases (%) 100 80 60 40 20 0 Oak Pine Cherry Walnut Poplar Tree species 100 80 60 40 20 0 Oak Pine Cherry Walnut Poplar Tree species


What conditions enable agroforestry with walnut to be profitable? Relative tree yield 1.4 1.2 1.0 0.8 0.6 0.4 0.2 Spain France 1. A high land equivalence ratio Deciduous tree with autumnplanted crops 0.0 0.0 0.2 0.4 0.6 0.8 1.0 1.2 1.4 Relative crop yield Poplar Cherry Oak Pine Walnut


What conditions enable agroforestry with walnut to be profitable? Equivalent annual value with no grants (4% discount rate) (€ ha -1 a -1 ) 400 200 0 CMD2 CHT1 CHT3 2. Profitable forestry i.e. high value timber 3. Profitable arable system 4. Relative benefit of agroforestry maximised when arable and forestry system have similar profitability


Conclusions 1. High establishment costs per tree/low per hectare; need to prune to increase timber value and maintain crop yields 2. Low discount rate generally favours agroforestry 3. Validated model for forestry, agricultural and agroforestry yields 4. Profitability dependent on tree species and grant regime • Agroforestry is often the most profitable way of establishing walnut, cherry and poplar in arable areas • Walnut and poplar agroforestry can be competitive with agriculture • Agroforestry could be used to restore oak landscapes (with minimal loss to farmers) in dry regions of Europe


Thank you


Additional slides


Comparison of value of walnut agroforestry with agriculture (France) 50000 Value (€ ha -1 ) 40000 30000 20000 10000 0 10 20 30 40 Time from planting (a) Agroforestry Agriculture Agriculture Agroforestry


Case-Study: predicted relative yields of a wheat/wheat/grain maize rotation below wild cherry in eastern-France Relative crop yield 1.0 0.8 0.6 0.4 0.2 0.0 0 10 20 30 40 50 60 Time from tree planting (a) Arable 50 trees/ha 113 trees/ha


Case-Study: predicted relative yields of a wheat/wheat/grain maize rotation below wild cherry in eastern-France 1.5 Timber volume (m 3 tree -1 ) 1.0 0.5 0.0 0 20 40 60 Time from tree planting (a) 50 trees/ha 113 trees/ha Forestry


Use of phased planting to minimise effect on farm cash-flow Assumptions • 8% (10 ha) of the farm cropped area • Successive plantations of 2 ha every 5 years of wild cherry and walnut trees • Treerowspacing: 26 m (90 trees/ha) • Choice of fertile plots to ensure tree harvest in 50 years


Phased planting: effect on farm cash-flow % de la 1ère révolution 175 178% 180% 191% 183% % de MB exploitation sans AF 150 125 100 75 50 25 EA avec 8% AF EA 100% agricole 0 0% 20% 40% 60% 80% 100% 120%

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