Regulations and yields threaten global arable profitability


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Global arable farm profits have reached record levels over the last year, but European performance is being impacted by new regulations, while there is also a worrying decline in African yields meaning the continent must expand its farmland if it is to feed its growing population.

These were some of the findings from the Agri Benchmark Cash Crop Network, which met in Kenya during the summer.

Yelto Zimmer, network coordinator, said: “The outlook for 2023 is also promising.

Global agriculture

“Provided yields are normal, the vast majority of the typical farms are expected to be economically very successful in 2023, despite increases in input prices and decreases in output prices for the current harvest.”

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European arable profitability was under threat from new regulations designed to reduce crop production product and fertiliser use, warned the network.

Marcel Dehler, economist at the Thunen Institute in Germany where Agri Benchmark is based, said: “Legal framework conditions are becoming more and more challenging; production output does not really count that much anymore. What matters are real or suspected environmental threats caused by agriculture.”

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The challenge in Africa was pressure on yields. The Tegemeo Institute of Agricultural Development and the National Council of Kenya told the Agri Benchmark conference maize yields had not moved in the last 20 years from 1.6 tonnes per hectare, while potato and sugar cane yields had slipped back.

Corn output

Mr Zimmer said: “The entire moderate increase in corn output has come from an expansion of arable land. Given limitations in land availability, and because of massive greenhouse gas emissions caused by this extensive growth through converting grassland to arable land, all speakers agreed that there is need for action.”

He was encouraged by the potential for greater production and improved yields in Kenya and other African countries.

Source: Farmers Guardian