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AGRO-ECOLOGICAL BLOGADDICTION: YOUR FARM IS A JUNKIETo paraphrase Robert Palmer, “might as well face it, you’re addicted to inputs”. At least you are if you are investing in ‘business as usual’ industrial agriculture. Oil and fossil fuels are the overwhelming achilles heel and ‘inconvenient truth’ for the industrial farming sector. When we evaluate an asset (farms in New Zealand), the level of synthetic fertiliser input is a material factor in determining whether or not the property is of interest to us. To put it simply, too much external input (‘drugs’) means the land is too addicted and will be harder to wean off and therefore harder to be developed easily, cost effectively and in good time into a robust, independent and resilient system. If you are so reliant on synthetic fertiliser then you are by definition also reliant on all the props that input necessitates, herbicides, pesticides etc. Once you put the first step in place you are committed to the full course. Thus further extending the exposure to fossil fuels/external inputs and sacrificing the robustness and self sufficiency of the farming system. The input providers are of course those that most benefit from this total reliance on external inputs for production. Such systems are driven to maximise production and so inevitably also bring in external sources of feed, e.g cereals and palm kernel. This further exposes the system to fossil fuel cost as cereal production is a significant utiliser of fertiliser and biocides, and in the case of palm kernel it exposes the enterprise to an industry with a highly dubious social and ecological foot print. This total (and it is total) reliance on external inputs which are all directly linked to fossil fuels, creates an enormous risk that is generally not even considered by those investing in farming production systems. As this farming system is totally reliant on the inputs, there are no shortcuts or half way measures, which in turn ensures that as input costs rise profitability drops and there are no easy actions that management can take to change this reality. If you pursue this strategy you are in effect placing the financial performance of your asset in the hands of the input dealers. If you drop those inputs you drop production and not necessarily just for one year but possibly for many. If you fail to apply the biocides required to maintain the system in an effort to reduce costs you may unleash a production destroying event....the farm is dependent on those inputs....it has to have them to survive. A number of voices from the more mainstream investment community, including some involved with farming (truly remarkable) are starting to recognise the level of dependence and the problems/risks that such dependence poses, but the recognition or understanding of how to deal with this seems to be completely absent. Bad news for GE fans...GE is at least as dependent on fossil fuel inputs and, given the super-weed problems that are expanding in such crops, it comes with its own set of additional challenges to performance. It is merely an extension of the system that has the problem not an answer to the problem...surely that is obvious? Systems that are more self sufficient, less dependent on external inputs and that are generating resilience in their production systems through superior soil management, biodiversity and a strategy of creating health in the total agro-ecosystem (soil, plants, livestock etc.) are enormously advantaged. The exciting thing is that over the next 10 years (and more) the performance differences between these approaches will become increasingly obvious to investors in farmland. As Ye Sow, So Shall Ye Reap.
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