Dr. Habtamu Alem (NIBIO, Norway) has recently published two studies focused on Norwegian dairy farms. The first article “A parametric analysis of eco-efficiency and its determinants: Evidence from Norwegian dairy farms”, in The Journal of Agricultural Economics, examines the eco-efficiency of Norwegian dairy farms over 30 years, focusing on methane (CH4) emissions. Analyzing data from 692 farms between 1991 and 2020, the study used a translog input distance function to estimate eco-efficiency scores and identify influential factors.
Findings: Norwegian dairy farms have room for improvement, with an average eco-efficiency score of 0.95, indicating a potential 5% reduction in input use and CH4 emissions while maintaining output. Factors such as secure land tenure, farming experience, and government subsidies positively impact eco-efficiency. Renting land also showed benefits by allowing flexibility for environmentally friendly practices.
Implications: The study aligns with similar research from Alberta, Switzerland, and Ireland, highlighting the role of socioeconomic factors in eco-efficiency. Secure land tenure, experience, and government support are crucial, though the effect of subsidies remains debated.
Conclusions: Alem suggests that Norwegian dairy farms can boost eco-efficiency through best practices and effective use of government support. Policymakers are encouraged to promote information sharing among top-performing farms for sustainable agricultural development. Future research should consider additional environmental factors for a broader understanding of eco-efficiency in dairy farming.
The second article “Measuring dynamic and static eco-efficiency in Norwegian dairy farms: a parametric approach”, published in “Frontiers in Environmental Economics” investigated eco-efficiency in Norwegian dairy farms between 1991 and 2020. The study investigates how well these farms manage resources and greenhouse gas emissions, specifically methane, while producing dairy products. The researchers used both dynamic and static models to provide a comprehensive picture. The dynamic model evaluates how efficiency varies over time, whereas the static model provides a snapshot at precise points. Accurate measurement was achieved using stochastic frontier analysis (SFA), a technology well suited to agricultural research.
Key Findings: The study reveals promising results: Norwegian dairy farms boast a mean eco-efficiency score of 0.94 according to the dynamic model and 0.90 according to the static model. These scores suggest farms could potentially increase production by 6-10% without needing more resources. However, inefficiencies are present, with some farms lagging best performers in resource utilization. The research also highlights advancements in agricultural technology within the sector. Factors that positively impact eco-efficiency include secure land ownership, experienced farmers, and government subsidies. Conversely, a high debt-to-asset ratio has a negative effect.
Policy Recommendations: The study emphasizes the need for policies that promote efficient resource use and technology adoption within dairy farming. Recommendations include Knowledge-sharing initiatives among farmers: Support for agricultural extension services and training programs; implementation of emission-reduction policies, such as promoting lower-methane-emitting dairy feed.
A Path Toward Sustainability: Enhanced eco-efficiency in Norwegian dairy farms translates to significant reductions in greenhouse gas emissions and resource use, paving the way for more sustainable agricultural practices. The research offers valuable insights for policymakers aiming to achieve environmental and economic sustainability within the dairy industry. Future research should broaden the scope to consider additional environmental factors, such as biodiversity and waste management, for a more holistic understanding of dairy farming’s impact on the environment
Article 1, “A parametric analysis of eco-efficiency and its determinants: Evidence from Norwegian dairy farms”, is available via this link: https://doi.org/10.17221/149/2023-AGRICECON
Article 2, “Measuring dynamic and static eco-efficiency in Norwegian dairy farms: a parametric approach”, is available here: https://doi.org/10.3389/frevc.2023.1182236