Bavo Verwimp — The economic story of agroecology

The essence of Bavo’s presentation can be found below.
You can view his powerpoint presentation here.

A short introduction to our company
De Kijfelaar is a mixed company in Belgium’s Kempen region. Five years ago we switched from being a purely dairy farm with about 90 cows to a mixed company. We continue to focus on livestock farming but the ratio has changed. Our main objective is vegetable production. We try to directly sell the crops we grow to customers in the neighbourhood.

The mixed approach makes our farm agroecological – we call it an organic farm – but our practices completely fit in with the concept. We are certified, which consumers consider to be added value. External inputs have been restricted to the minimum (except for additional manure and lime). The livestock has its own place in our operation. We have limited the quantity to 1/3 livestock (30 hectares). We feed them the clover in the fields that are fallow, but also waste, e.g., potatoes that are not fit for human consumption. So our animals have their specific place, they close the loop and they also provide us with good manure.
Our conclusion – five years after the switch – is that our production is actually quite efficient. The technical aspects of the switch also went well. Not that there wasn’t the odd hitch, but things are going well. We have good and tasty products. My conclusion is that it is possible to be an agroecological farmer. At agri-technical level there are a lot of possibilities for alternative farming.

Why don’t more farms switch to an agroecological approach?
I think that this is due to the agricultural economic aspect. The current model is tailored to conventional agriculture. It does not work for organic farmers. Our products cannot be made sufficiently profitable.

Let’s take a closer look.
The problems are not that different from the problems that conventional farmers experience.
1. Eco-services
We produce commodities as well as providing eco-services. Europe has created the agro-environmental measures for this but the transaction cost is quite high. This does not fit in with the economic model.

2. Supply and demand
A bigger problem is that the price that we receive for our products is increasingly different from the price that we pay for the input. In other words our products are expensive. As organic farmers we have relatively few input costs but the low sales price also affects us. This problem extends beyond the field of agriculture.
It is a classic problem but it is very difficult to align the supply and the demand. This year we had twice as much straw as we did last year. We have sufficient storage capacity and straw is easy to store. But if you look at the difference in harvest with the same surface area and the use of the same techniques... As a consequence farmers are often the victim of this and you have to resign yourself to the low price.
You can also respond rather slowly to the demand. If a consumer wants a certain pear, then it may easily take five years before you have switched to this pear as a farmer, with sufficiently high production and quality. That is too late for the market.

3. The aspect of the availability of information . All the participants in the market should have the same information at the same time but this is impossible. The farmers do not have the same knowledge as the buyers.

4. Homo economicus
A farmer is not always a homo economicus. He often has different perspectives or motivations. For example, the survival of their farm is often more important than the income in the short term. They think across generations. In other words, who will have to stop, who will continue to work and produce. You then may find yourself with a supply for which there is no demand. In other words: the theoretical model does not work.
As organic farmers we follow the prices in the supermarkets (and there is already quite a lot of organic food on shelves in shops). Don’t be fooled: organic farmers are also pressured to deliver as cheaply as possible to the big chains. For organic food we are still in a demand market and there is scarcity but the same mechanisms seen in conventional agriculture also impact our market.
My aim is to devise a solution for this. There are various types of markets and various ways to organise your economy.

A lot of organic farmers are currently searching for solutions at the micro-level. Direct sales, CSA (community supported agriculture systems), diversification – fair trade, eco tourism,…
Even with short chains the price is still under pressure – the majority of the customers compares prices, only a small group of customers pays the full price.

Here we need to intervene at the macro-level.
In Wervel, a non-governmental organisation, which focuses on fair agriculture, we have already done this. In order to provide agroecological agriculture a framework in which a macro-economic agricultural model can be developed which is also sustainable in the long term, there is a lot of a potential in Daly's concept of the ecological economy. More specifically it starts from a limited physical environment. There is no unlimited growth in this model. You have to and you can work efficiently, but there are limits.

The concept of ecological economy takes three steps (in a different order than the conventional economy).
First you determine the scale. What can we produce on our limited land and based on our limited ecological capacity?
Searching for suitable instruments to enable production control.
Step two: sharing of the cake between countries, regions and the farmers themselves. Step three, how can we use the limited land, the limited input as efficiently as possible?
We cannot do this at the farmer’s level, the government has to help us do this. Not that we are asking for money but we do want certain matters to be facilitated.

Bavo Verwimp trained as an agricultural engineer (KULeuven) and subsequently studied agricultural economics at UCLouvain. After a few introductions to various agricultural models in other countries (including Chile) Bavo returned to the Kempen Region and his roots.
Bavo is active in various fields. He works part-time as an agricultural economist, contributing to the economic impact analyses of nature projects, for example. Next to this he also works at his own organic farm, bioboerderij De Kijfelaar, which is a mixed farm with livestock, agriculture and horticulture and which is almost exclusively tailored to direct sales. In addition to production the farm also has several parcels of nature, which it maintains while using them for farming purposes.
Bavo spends the remainder of his time volunteering for a number of organisations, such as Wervel, for which he recently wrote an article on agricultural and ecological economics.

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