Rice farmers greatly appreciate eco-labels

Taiwanese rice farmers are willing to produce in a more environmentally friendly fashion if this would earn them an eco-label for their products. To obtain such a label they are even prepared to accept lower compensation payments for reducing fertilizer use. These were the findings of a study conducted at the Chair of Agricultural Production and Resource Economics for Agricultural Enterprises of the Technical University of Munich (TUM) and published in June 2017.

This study investigated incentives for agri-environmental measures such as more sustainable cultivation methods. To obtain higher yields, chemical fertilizers are often excessively employed in Asian countries - to the great detriment of the environment. This leads to high amounts of nitrogen entering the groundwater, which is not only a health hazard for the population, but also negatively impacts the flora and fauna.

At the same time, nitrogen contributes to the loss of biodiversity and accelerates climate change. The intensive application of fertilizers during rice cultivation has already led to the loss of numerous species in Asia, Australia, Western Europe and North and South America.

To date, scientific studies have mainly investigated the technological options for reducing fertilizer quantities. But how willing are farmers to reduce the use of fertilizers, and what are the necessary conditions?

Rice being one of the most important staple foods worldwide, the authors of the study decided to collect their data from rice farmers. The data evaluated was collected in a ‘discrete choice experiment’ with around 300 rice farmers.

The authors found that Taiwanese farmers assigned a high value to the eco-label, because it communicates directly to the consumer that this product was manufactured in an environmentally friendly manner. They found that the eco-label is more important to the farmers than financial compensation. According to the authors, factors that influenced the choices made included the prospects of higher profits from the eco-label, but also the farmers’ own self-perception.

Article: Sheng-Han-Erin Chang, David Wuepper, Alois Heissenhuber, Johannes
Sauer: Investigating rice farmers’ preferences for an agri-environmental
scheme: Is an eco-label a substitute for payments? - Land Use Policy 64,
2017.

(TUM/ile)