Adapting and using the bio-economic model FSSIM to assess the impact of agricultural policies on sustainable development of arable farming in Taihu Basin, China

Submitted by charlotte.schilt on Mon, 09/24/2018 - 14:18

Water pollution is a major problem in China. This is also the case for the Taihu lake. Main causes of water pollution are industry, domestic sewage and agriculture. Successful measures to reduce pollution from industry and domestic sewage have been implemented, and therefore non-point source pollution from agriculture becomes the major source for the water pollution. The agriculture in the Taihu lake basin causes overload of nutrients in the water body due to excessive use of fertilizer inputs, which are higher than needed to support the high yields.

The aim of this study was to perform an ex-ante integrated assessment of the impact of agricultural land use policies on nutrient pollution and on sustainable development at large at farm type level in Taihu Basin. Sustainable development is needed to improve the situation of the Taihu Lake Basin, as policies improving the environment will not be effective if they are not economically and socially acceptable.

In order to assess the impacts of the policies on agricultural sustainability in Taihu lake basin, the bio-economic farm model FSSIM (Farm System SIMulator) is used. FSSIM developed in the European context, was changed to fit to the Chinese case study. As database for input and outputs of agricultural activities TechnoGIN (Technical coefficient Generator for Ilocos Norte province) was used.

FSSIM-China has been programmed such that in each run the base year (2008), baseline (2015) and policy scenario (2015) are simulated. The base year exactly reproduces the observed activity levels in 2008, due to the PMP (Positive Mathematical Programming) calibration method. The data used are based on field survey of 320 farmers in 2008. Changes in results for the baseline and the policy scenario (2015) are dependent on the elasticity of the crop-management combinations in the model, which is a part of the PMP procedure and the height of the prices, costs and yields which are estimated by trends of historical time series.

Four policy options were used to assess the effect on sustainability: 1) FF (formula fertilizer) use 2) Stimulation of SSNM (Site Specific Nutrient Management), 3) stimulation of MT (mechanical transplanting) and 4) buffer zones. The results show that the use of FF application will be higher in the baseline than in the base year. Just applying fertilizers with a different contribution of N, P and K is however not enough to reduce nutrient leaching, and therefore improved SSNM including change of timing and amounts should be stimulated. In case of stimulating SSNM, then the FF application as practiced in the base year will decrease compared to the base year and the use of SSNM will increase. The stimulation of SSNM is a good option for improving the water quality of the Taihu lake, while still being economically and socially acceptable. It is only difficult to stimulate the use of SSNM, due to the high need for training and education of the farmers while labour is limited. Extra subsidy for SSNM could help to stimulate the use of SSNM and could prevent the decrease the food production, because farmers are going to cultivate more single crops compared to rotations due to good off-farm opportunities. The stimulation of MT does not help to improve the water quality, but the use of MT machine is very important for farmers, because it saves labour. Saving labour is so important, because in most cases working off-farm leads to a higher income than working on-farm. The fourth policy option is the buffer zone. Buffer zones have at farm level little impact, but compensation payments are nevertheless too low. Buffer zones are expected to have a large impact on the water quality. Scale enlargement is tested as a policy scenario. Scale enlargement did lead to more mechanisation on the farm if labour was limited. If labour was limited then the environmental outputs decreased due to cultivation of fewer crops, if labour was not limited the environmental outputs did not decrease in the policy scenario compared to the baseline.

The model chain TechnoGIN-FSSIM has proven to be useful to ex-ante assess agricultural policies at farm level in Taihu Basin. Constraints for the adaptation of technologies, and impacts on environmental, economic and social indicators are evaluated, allowing to better target policies.

Marloes van Loon


Taihu lake; Sustainability; Bio-economic farm model; Nutrient leaching; SSNM; Policy assessment
Pytrik Reidsma