On the economics of crop rotation diversification. Valuing pre crop and cropping system effects and accounting for opportunity costs

Crop diversity in general, and crop rotation diversity in particular, is a key principle in the design of agro-ecological cropping systems for arable crops. Since economic motives are of primary interest for farmers, assessing and analyzing the economic return of crop production diversification is essential for convincing farmers to consider diversified cropping systems for adoption as well as for identifying key elements to be improved in the diversified cropping systems that are currently proposed or developed. This article presents a simple approach for assessing and analyzing the economic value of crop rotation diversification. This approach relies on basic economic calculus and on data that describe the technical performances of crop rotations with various degrees of diversity in comparable production conditions. It demonstrates that the economic value of a diversification crop can usefully be decomposed into the sum of three components: the value of the pre crop effects, the value of the cropping system effects and, finally, the opportunity value – benefit or cost – of producing the diversification crop. The last component is purely economic while the two others can be aggregated for valuing the agro-ecological effects of crop rotation diversification. The approach is illustrated by means of an application considering the insertion of pea in a cereal-based rotation, a topic of special interest in the EU owing to the current EU dependence on imported protein for feed production and to the benefits brought by inserting legumes in cereal based production systems. Simple sensitivity analysis approaches, based on basic calculus, are also shown to be very useful for assessing the effects of the wide variety of components of the economic value of crop diversification. Our case study highlights the effects of the yield of pea and of fertilizer and crop prices on the value of pea as a diversification crop. More generally, our investigations for gathering data for applying our approach also revealed significant information lacking, especially for describing the effects of cropping system diversification on yield and chemical input use levels. Documenting these effects is crucial for assessing the economic benefits and costs of crop diversification for farmers. These observations certainly calls for agronomists to pay more attention to the economic features related to their research topics and for economists to better account for the agronomic features of the questions they address when they consider agricultural production practices.