Eur-Agri-SSP 3: Agriculture on separated paths

The content of this page is drawn from Supplementary Material I of:

Mitter, H., Techen, A.-K., Sinabell, F., Helming, K., Schmid, E., Bodirsky, B.L., Holman, I., Kok, K., Lehtonen, H., Leip, A., Le Mouël, C., Mathijs, E., Mehdi, B., Mittenzwei, K., Mora, O., Øistad, K., Øygarden, L., Priess, J.A., Reidsma, P., Schaldach, R., Schönhart, M., 2020. Shared Socio-economic Pathways for European agriculture and food systems: The Eur-Agri-SSPs. Global Environmental Change 65, 102159.

1         Population and urbanization: Decelerated urbanization

European population decreases slowly because of decreasing birth rates and a decline in international migration to Europe. Decreasing environmental awareness and loss of confidence between agricultural producers and private consumers results in weak urban-rural linkages, even though the process of urbanization slows down. Urbanization is constrained by low economic growth and residents’ limited mobility. Public and private investment in social and technical infrastructure decreases in urban and, particularly, in rural areas. This is, for instance, reflected in poor maintenance of roads and other infrastructure, and quality deficiencies in education, training and extension services. Educational attainments of society and farmers are thus stagnating. The public image of farming is not changing which contributes to reduced labour supply, and inter-generational land and property transfer remains a challenge.

2         Economy: National agricultural supply chains benefit from protectionism

The European economy is characterized by a climate of distrust between economic actors including governments. It culminates in severe international trade tensions and isolated economies, but also in neo-colonialist export policies and land grabbing. European economic growth rates decline whereas economic disparities between and within countries grow. In the agricultural sector, access to international markets is limited and integration between countries is decreasing. Market concentration increases within countries and becomes evident through increasing relative prices of agricultural inputs (such as seeds, mineral fertilizers and chemical pesticides) as well as non-transparent, national agricultural supply chains. Non-transparency is related to weak democratic institutions and reduced investment in traceability systems by public and private actors.

Demand for domestically produced agricultural commodities is increasing due to self-sufficiency concerns of countries, in particular with respect to food, feed, and agro-fuels. Export activities and trade between European countries are decreasing mostly because of trade restrictions. Traditional diets, as well as a limited range of highly processed products, remain important in domestic markets. Therefore, the occurrence of diet-related deficiencies, disorders and diseases (e.g., allergies, diabetes, cardiovascular disease) persists. The level of food waste stagnates because of increasing relative food prices on the one hand and poor food knowledge and decreasing environmental awareness on the other. To a large extent, food prices are driven by the decline of international and European trade, increasing market concentration and input prices, stagnating land and labor productivity, and slow technological progress. However, the generally declining real purchasing power of households and government interventions – even though sometimes weak – prevent substantial increases in food prices. Consequently, structural change in agriculture continues at a moderate pace. The generally decreasing real purchasing power also results in decreasing consumer willingness to pay for food quality. Accordingly, attributes such as high food safety, animal welfare, environmental protection and fair working conditions lose importance with consumers.

Relative to the general price level, prices for agricultural inputs increase and competition for natural resources is fierce resulting in increasing relative resource prices. Labor productivity remains constant because of resource limitations, slow but continuous technological progress and adequate qualification standards of agricultural workers. Labor supply is decreasing because of tight restrictions on immigration to Europe and rather unfavorable working conditions, e.g., hard physical and mostly seasonal work in the agricultural sector. Land productivity is stagnating even though farming is professionalized as a result of continuing structural change. This is mostly because of land degradation from inadequate management.

3         Policies and institutions: National agricultural policies aiming for national food and energy security

Europe experiences continuing political conflicts, which result in political instability, inefficient governance structures, and non-cooperation between international, European and national organizations and institutions. In general, public administrations malfunction which results in a decrease in democratic accountability and poor integration of civil society in decision-making processes. Accordingly, cross-border topics such as trade and environmental standards are decided at national or sub-national levels. Trade between European countries is severely restricted, and international environmental agreements are either not prolonged or abandoned.

National agricultural policies aim at national food and energy security. Accordingly, public payments aim to maintain the national production potential and include coupled payments, price supports, import tariffs, and safety nets for national producers in periods of insufficient market incomes and for less favored areas. These efforts lead to high public expenditure on the agricultural sector, periodic agricultural over-production and food losses during storage. Although extension services aim to stimulate efficient production, persisting education levels and slow technological innovation hamper progress. Since national production potentials need to be exploited, public payments for environmental services are limited to pollution hotspots and are reluctantly accepted by producers. National governments define agricultural production standards, although at decreasing levels. Potentially diverging standards impair the flow of information and international trade. National governments also decide on approval and restriction of new technologies and define data protection standards for farmers and consumers.

4         Technology: Slow agricultural technology development and uptake because of reduced investments and skepticism

Technology development and diffusion are slow because of declining public and private investments in research and development and weak cooperation among sectors and national governments. If available at all, agricultural research and development focuses on productivity and self-sufficiency, whereas resource use efficiency and environmental protection are only secondary concerns. Low cooperation between actors in the agricultural supply chains also hampers the development and successful implementation of new technologies. Furthermore, skepticism about emerging technologies is growing because of uncertain and potentially harmful consequences of technology adoption, and because of data piracy concerns.

5         Environment and natural resources: High pressure on natural resources through high national demand for agricultural commodities and limited coordination and technological progress

Competition for land and the pressure on natural resources increases, which amplifies cross-border environmental conflicts, e.g., in transboundary watersheds or about airborne particulates. These result from the high public priority for domestic food and feed production, decreasing environmental awareness and the insufficient involvement of environmental organizations in public decision-making processes, decreasing cooperation between economic sectors, weak coordination of production processes and slow technological progress. Even though resource depletion and biological and genetic diversity losses are increasing across Europe, societal concern for the environment is decreasing which is reflected in relaxed environmental standards and decreasing interest in the regulation, maintenance and cultural services of the agricultural sector. With respect to invasive species and the spread of diseases, the risk stagnates because of severe trade restrictions. In the case of an outbreak of, e.g., an animal disease, trade restrictions are further tightened.