Eur-Agri-SSP 5: Agriculture on high-tech 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: Metropolization

The European population increases because fertility is above replacement levels and international immigration to Europe is increasing. The vast majority of the European population lives in metropolitan areas with a high degree of international linkages. Migration from rural areas, as well as from small towns towards growing cities, is increasing. European residents are increasingly educated and share a high faith in technology in all aspects of life, including the agricultural and food sectors. However, the relationship between farmers and the rest of the society is decreasing because of a high degree of individualization and egocentrism, and long distances between the places of agricultural production and food consumption. Social and technical infrastructure is developed rapidly by the private sector in order to satisfy the requirements imposed by accelerated urbanization. The population and quality of life in remote rural areas are decreasing because public investments are drastically reduced. Only rural areas connected to metropolitan areas through supply chains succeed in maintaining population, infrastructure and economic activities. The agricultural sector is undergoing a generational change with declining average age of farm managers. It is driven by the new job profiles where physical labor is largely replaced by high-tech machinery and inputs.

2         Economy: High-tech large companies dominate globalized agricultural supply chains

The European economy grows more rapidly which is mostly because of rising private investments into technological innovation and the supply of an increasingly qualified workforce. Furthermore, European decision-makers have a strong interest in trade liberalization and continue to strengthen multi-lateral trading systems at the global level. Global market integration increases competition in the agricultural sector but only a few large international high-tech companies organize and connect agriculture supply chains through online platforms. Agricultural commodities are traded globally and supply chains expand due to a higher degree of specialization. However, supply chain management is fast and benefits from emerging technologies, which allow for simple contracts combined with real-time tracking of commodity flows. This results in increasing transparency, fast financial transactions and decreasing administrative costs. The pace of structural change in agriculture towards further industrialization and global integration increases.

Global demand for European agricultural commodities is increasing because of increasing quality standards set by privately owned companies. Domestic demand for bio-based industrial raw materials such as fiber increases, whereas demand for agro-fuels remains constant. Consumers prefer diverse diets with high-value, fresh and exotic ingredients that are customized to human health needs. At the same time, they ask for sensory (e.g., flavor, design, smell) food adventures. Innovations in the food sector to satisfy the ever-changing food preferences are seemingly endless. New food items in Europe include exotic superfoods, cultured meat, and insects with high nutritional value. Robotic chefs and food printers combine real-time personal data with individual preferences to optimize diets to personal health needs. Technical solutions help to stabilize levels of food waste in households and food loss along the supply chains. With respect to ecosystem services, the mainly urban residents demand the maintenance of biodiversity, landscape elements and recreation areas in their living environment only, but are not interested in environmental protection in remote rural areas or at the global level.

Relative to the general price level, prices of European agricultural commodities change little because of high quality standards on the one hand, and liberalized markets and decreasing crude oil prices on the other hand. Relative prices for agricultural inputs decrease, mainly because of rapid technology development and increasing levels of fossil resource supply at low cost. Liberalized markets also affect land prices which even-out at high levels. The supply of skilled labor in the agricultural sector is increasing, mostly because of high educational standards, international immigration to Europe, new job profiles, improved working conditions, and rising wages. However, the number of jobs in agriculture is declining, and the remaining jobs are dominated by those establishing and monitoring advanced technological solutions. High qualification requirements are accompanied by higher labor costs and productivity. Land productivity is increasing and benefits from rapid technological progress and improved management, but suffers from environmental degradation if adapted technologies are lacking.

3         Policies and institutions: European institutions foster international trade but delay environmental action

European institutions make large efforts to advance formally binding international trade agreements, to foster economic growth and to reduce institutional barriers for disruptive technologies. Multi-level cooperation is pursued to achieve progress in economic, security, and development policies. In contrast, environmental goals are deferred because of the clear priority for economic growth.

Comprehensive trade agreements aiming at liberal and integrated markets reduce the legitimacy of public payments for the agricultural sector. Accordingly, European policy makers drastically reduce income support, agri-environmental payments, and payments for maintaining farming in less favored areas. Investments in the development of agricultural technology and technical infrastructure in rural areas are mostly financed by private actors, whilst public investments are reduced to a minimum and focus on agricultural professional education. Limited payments for ecosystem services remain, e.g., for biodiversity conservation, as a top-up to counter-balance decreasing European environmental standards. Technology, production and trade standards related to the agricultural and food sectors are set by large private enterprises, which further supports market integration and competition.

4         Technology: High affinity for output oriented technology

Globally, technological progress towards high productivity is very rapid and benefits from infrastructure development, increasing private investments in research and development, decreasing crude oil prices, and urbanization. Technology diffusion in the agricultural sector is driven by the sector’s professionalization. Many processes are automated in order to increase productivity and speed-up processing. Considerable rapid progress is made in breeding, genome editing, and reproductive cloning. Technical advances in the agricultural building and machinery industries are also substantial. On the farms, integrated farm management systems are becoming standard practice and effective logistics and marketing technologies are increasingly established. Technological progress also facilitates cooperation between farmers because of decreasing communication costs. Supply chain management is accelerated and companies draw on big data technologies to develop new business models and products. Technological progress in food processing and industrial food production is high. The private end users employ traceability systems to inform themselves about agricultural products and their health footprints. Furthermore, distribution is based on online shops as well as automated home delivery services.

5         Environment and natural resources: Lack of global environmental awareness

The private sector makes efforts to increase productivity and human well-being with new technologies, but focuses less on increasing resource use efficiency. Resource demands rise, also because of the resource- and energy-intensive lifestyles. This results in increasing pressures on land, water, and biodiversity. The increased prevalence of invasive plant and animal pests and diseases is the consequence of globally connected markets and reduced public and private efforts devoted to environmental protection. However, selected areas with high nature value are preserved and technologies to control invasive species are developed.