Dutch Policies Aimed at Diminishing Mineral Releases in Agriculture

The Policy in Brief

Economic Instrument (proposed): A regulating levy on mineral releases, with compulsory mineral accounts.

Problem: Acidification and eutrophication of the environment due to mineral losses from animal manure and fertilizers on farms.

Goal: Reduction of mineral releases in agriculture.

Description: An evolving set of policies that began with fixed standards and levies on nitrogen, and is moving toward more sophisticated measurements and charges for flows of minerals including phosphorus.

Administering Institutions: Ministries of Agriculture and Environment.

Key Stakeholders: Livestock farmers, livestock industry, Ministries of Agriculture and the Environment and the Dutch Centre for Agriculture and the Environment (CLM).

An Overview

Current Dutch policies aimed at curbing mineral releases include:

• A ban on the growth of manure production per farm over and above a basic level calculated on the basis of standard allowances for different species of animals;
• Regulations as to spreading of manure for different crops at different times of year;
• A fixed levy for superfluous manure based on the number and type of animals relative to a farm's surface area; and
• Rules relating to manure storage and animal accommodations, to be implemented in stages, with the objective of reducing ammonia emissions.

Unfortunately, current policy measures have many problems, not the least of which is that their environmental objectives are not being achieved. They are not as cost-effective as they could be. They ignore minerals other than phosphorus, together with all those which originate from artificial fertilizers. They provide insufficient incentive to reduce actual mineral losses on the ground. They are seen as inequitable, because they do not reward farmers for 'leading the way' on reductions in any given farm situation. Finally, even if existing measures were intensified in order to achieve the environmental objectives, ordinary farm operations would likely be so hampered as to make this an unattractive policy option.

A number of improvements have been suggested to make the policies more inclusive, customized and incentive-oriented. First, artificial fertilizers should be included, along with nitrogen use. Second, variable payments should be instituted based on the actual quantities of minerals used (rather than just livestock numbers). Third, the specific circumstances of individual farms should be considered. Fourth, a compulsory mineral accounting system should be introduced as a basis upon which to streamline and facilitate an equitable mineral reduction policy.

The idea of compulsory mineral accounts was proposed by the Ministry of Agriculture, Nature Conservation and Fisheries in June, 1993. Starting dates suggested for using the mineral accounts as a management tool, and later as a regulating instrument, were 1995 and 1996 for the livestock rearing sector and 1997 and 1998 for the agriculture and horticulture sectors, respectively. Such compulsory mineral accounts would represent an enormous improvement. With their aid, both the supply and the disposal of minerals as well as the difference between the two - that is, the mineral losses into the environment - could be registered. The system can be used to map the losses due to the use of animal manure as well as the losses when fertilizers are used. Thus the opportunity arises to integrate to a large extent the approach to the problem within the agricultural and livestock sectors.

An investigation into the manner in which mineral accounts can be used as a regulating instrument was undertaken by the CLM. Its basic accounting framework is:

mineral supply - mineral disposal = loss into the environment

Mineral supply includes the number of kilograms of nitrogen and phosphorus in: animals (alive or dead), concentrates, roughage, fertilizers, animal manure, deposits, net mineralization, nitrogen-compounding by papilionaceous flowers, seeds, young plants, compost and sludge.

Mineral disposal includes: animals (alive or dead), milk and dairy products, eggs, other animal products, animal manure, vegetable products and vegetable waste. In choosing these items of supply and disposal, the CLM attempted to emphasize fairness, sensitivity to fraud and an item's scope. The system does not involve a great deal of extra work for farmers, as most items are already being recorded in existing operating accounts, or else tend to remain fairly constant. Fraud is discouraged in a number of ways, such as by cross-checking deliveries between farmers as well as deliveries across the industrial chain. The submission of an auditor's report on the mineral statement is also encouraged. The levy for mineral losses is expected to be between 1 and 2.50 guilders per kilogram for nitrogen and between 1 and 5 guilders for phosphorus. The levies for nitrogen and phosphorus should be proportionate to the volume of losses of these minerals into the environment. It is also intended to have the revenues flow back into the agrarian sector, for example by developing a system granting subsidies to farms with relatively low emissions.

One major advantage of the proposed new levy system is that farmers 'leading the way' in mineral reductions are no longer punished. Another advantage is that measures will become more cost-effective, due to the fact that the farmers themselves decide what measures are most suitable in tackling the mineral losses within their operations as efficiently as possible. Thus they are given an incentive to balance the costs related to the various measures, against the decrease in mineral losses and the resulting decrease in levies to be paid. In this way the system promotes the most cost-effective measures. The reductions in mineral losses can be achieved by a diversity of measures, all of which show up in the mineral balance sheet as a mineral loss. Examples of possible measures include:

• Computer-controlled feeding of animals;
• Reduction of the mineral content in animal feed;
• Construction of low-emission stables; and
• Mixing manure with the soil, resulting in less ammonia evaporation and more nitrogen availability for crops.

Some Further Reading

CLM (1990). De Mestwetgeving: Evaluatie en Voorstellen voor nieuw Beleid, CLM.

CLM (April, 1993). Regulerende Heffingen en Premies op Mineralenoverschotten van land-en Tuinbouw, CLM-110-1993.

Rijksinstituut voor Volksgezondheid en Milieuhygiëne, (RIVM) (1993). Nationale Milieuverkenning 1993-2015, RIVM.

For further information, please contact: Centrum voor Landbouw en Milieu (CLM), Amsterdamsestraatweg 877, Postbus 10015, 3505 AA Utrecht. Tel: 31 30 2441301, Fax: 31 30 2441318.

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