Costs Of In Situ Conservation

According to information provided by the national reports, only 24 of the 145 countries submitting a report to the International Technical Conference on PGRFA in 1996 have indicated some kind of in situ conservation of PGRFA (see Table 6-1). The information related to in situ conservation activities is, however, very limited. The officially reported activities refer mainly to the conservation of wild relatives of crops. Considering this limited information base, it is not surprising that the information on the costs of in situ conservation activities is negligible or nonexistent. In addition, taking into account that one major cost factor is the opportunity cost of foregoing use of high-yielding varieties, it is understandable that the cost accounting for in situ conservation activities is quite difficult. In the following section, a conceptualized framework for analyzing the costs of in situ conservation activities is presented, together with a specific example of cost assessment for an in situ conservation activity.

Besides some specific transaction and other overall costs, which do not relate directly or exclusively to the in situ conservation activities (see Chapter 8), three different types of costs can be identified for the different in situ conservation activities:

1. Direct costs for in situ conservation programs and projects, including:

• Implementation costs for the programs and projects, e.g., establishment costs of infrastructure, materials, and personnel.

• Management costs for the programs and projects, e.g., operating costs of infrastructure, materials, and personnel.

• Pure production costs for the variety.

2. Costs for supporting activities, including payments made for compensation or incentives for maintaining PGRFA diversity in farmers' fields.

3. Opportunity costs for the use of land for the maintenance of farmers' varieties, including:

• Private opportunity costs for the individual farmer.

• Social opportunity costs for a country.

• Opportunity costs will primarily be composed of the loss of income and food production through foregone utilization of high-yielding varieties on land enrolled in conservation programs and are discussed in greater detail below.

4.1 Direct costs for in situ conservation programs and projects

To date, cost estimates for in situ conservation are rare. An interesting study on the costs of in situ conservation is a survey on potatoes in Peru by Gehl (1997). It was estimated that the conservation of one traditional variety costs US$594 per year (see Table 6-2); 84% of these costs were fixed, determined by the in situ conservation project and its costs. Only 16% of the costs (US$98) were derived from the opportunity costs, defined as foregone benefits by cultivating the traditional variety, based on the assumption that farmers cultivated different traditional varieties because of conservation concerns.

Table 6-2. In situ conservation costs for potatoes in Peru_

Conservation method _Costs / accession / in US $_

Variable costs Fixed costs Total costs

In situ conservation / Perua 98 496 594

a Including opportunity costs. Source: Gehl (1997).

4.2 Compensation for in situ conservation activities

When technological and economic changes occur, institutional arrangements have to be implemented to foster PGRFA conservation with increased incentives. Given the appropriate economic incentives, farmers could continue to cultivate traditional varieties and do so for the sake of conservation. Few countries presently provide incentives to farmers to support in situ conservation of their landraces. Proposals for such incentives have, however, been put forward in countries like India, the Philippines, and Tanzania (Virchow, 1999). The costs of these incentives are essentially the opportunity costs of in situ conservation.

Attempts to influence the behavior of individuals (farmers) and of whole groups (countries) through the use of incentives may be divided into educational, institutional, and economic measures. Educational incentives, e.g., awareness promotion, may sensitize farmers to the social importance of the conservation of agrobiodiversity, but as Morris and Heisey (1997) emphasize, profit-motivated farmers will in general not be willing to renounce the additional benefit of a less agrobiodiverse production system to benefit society.

On the one hand, institutional incentives could internalize the positive external effects of PGRFA conservation by improving the property rights situation for farmers, allowing them to capture the value of their activities. On the other hand, institutional incentives could be imposed to force farmers to conserve PGRFA diversity. In addition to being undemocratic and inequitable, the efficiency of such a method may be questioned, and the enforcement of any sanction is difficult in countries with poor infrastructure.

The problem of implementing enforceable mechanisms to internalize the costs of diversity loss such as taxes or charges for maintaining agrobiodiversity at socially optimal levels in the field is largely insurmountable. The specific needs of agrobiodiversity conservation, namely, to reduce the area under different traditional varieties to a safe minimum, only permits the utilization of positive incentives.3 Direct and indirect positive incentives may involve using market mechanisms to target

3 The objective is to maintain the different crop varieties in farmers' fields, but to reduce the area so as to increase food production through cultivation of higher yielding varieties.

individual farmers and to influence their decision making. These incentives should be coordinated with market forces so as to develop a market for genetically coded information, but also to afford protection against market imperfections, i.e., recognition of the nonuse values of agrobiodiversity that do not enter into market transactions.

The best direct incentive measure for promoting the maintenance of agrobiodiversity among selected individual farmers would be a payment mechanism, through which farmers would be compensated for continuously cultivating a specific variety or maintaining a specific level of agrobiodiversity in his or her fields. The amount of compensation could be determined by the opportunity costs of foregoing alternative production systems, specifically a conversion to a system with modern varieties. Other direct incentives could be rewards for diverse production systems or other social-based incentives. However, the most important nonmonetary incentive would be improved cooperation between farmers and genebanks, especially enabling farmers to receive germplasm from the genebank for further utilization (Gupta, 1996).

4.3 Private and social opportunity costs of in situ conservation activities

To analyze the costs of in situ conservation, especially the opportunity costs, some conceptional considerations concerning the conservation of PGRFA should be raised. These considerations regard the determinants of the loss of PGRFA in farmers' fields as well as some basic considerations regarding the opportunity costs facing different groups of farmers in adopting conservation activities. The amount of PGRFA diversity maintained in farmers' fields is determined at three levels (see Fig. 6-2): the framework-level, the decision-making process on farm-level, and the level of land-use development.

The maintenance level of PGRFA in farmers' fields is determined by factors at the framework level, which directly or indirectly influence the present and future level of PGRFA in farmers' fields. These include socioeconomic factors, the development of a relevant market, policies and institutions, as well as natural disasters, war, and civil strife.

Figure 6-2. Factors determining the diversity-level of PGRFA in farmers' fields Source: Virchow (1999).

The decisions made on the farm level depend on the individual or farm-specific objectives (see, e.g., Chapters 5 and 7). The practice of cultivating different varieties or crop species and thereby maintaining a specific level of PGRFA diversity is mostly a positive externality of the farm sector.

Farmers, being the main contributors to diversity of PGRFA in the past, are at present those who influence the state of diversity of PGRFA the most with their day-to-day activities. Decisions at the farm level may result in changes in agricultural production systems. These changes will have impacts on the level of land-use development. A major category of change in agricultural systems is its intensification through the application of new technology, which may lead to variety replacement, overexploitation of genetic resources, and habitat destruction. As a side effect, changes in agricultural systems may lead to the introduction of new pests, diseases, or weeds; or, in an extreme case, these changes may lead to the abandonment of agricultural production and the development of nonagricultural land-use systems. The site- and time-specific factors of the different levels and their inter- and intra-linkages determine whether the quantity of PGRFA diversity in farmers' fields is maintained, increased, or reduced.

The farm level is the key point for targeting the decision-making process to influence the diversity in in situ PGRFA. If the farmer expects greater benefits from the use of new varieties, the farmer will replace the old varieties with the new varieties. Brush and Meng (1996) found that many farmers, even though introducing improved varieties, are keeping farmers' varieties in their production systems. These farmers are doing this mainly because the new varieties do not have certain traits (i.e., taste) which are known in the traditional varieties. However, assuming that breeders are going to incorporate these specific traits into the improved varieties as well, the farmers will have no incentive for keeping the traditional varieties any longer.

According to the field experience of Pundis (1996), farmers adopt a new variety if the yield gains are over 15% greater than that of the traditional variety. The more the plant breeding improves the new varieties (i.e., incorporation of all needed or asked for traits), the more farmers' varieties will be replaced by the improved varieties. For each trait incorporated into an improved variety, the advantage of one or more farmers' varieties will be diminished or lost. As breeding is a long and difficult process, the replacement over all farms will take some time.

The farmers' decision to utilize modern varieties leads to the reduction of land cultivated with specific traditional varieties. If all farmers who cultivated a specific variety replace it with modern varieties, that traditional variety will disappear from farmers' fields. Each farmer will make his or her decision based on his or her private marginal benefits and marginal costs, which do not reflect the social costs of the variety loss. Depending on the population dynamics of each variety, less than 1 hectare of cultivated area may be sufficient to conserve one variety (Bücken, 1997). Technically speaking, the loss of traditional varieties through the transformation of land under traditional varieties to modern varieties, is a negative environmental externality with a very high buffer capacity determined by the specific ecological threshold effects (Perrings and Pearce, 1994). Consequently, the negative externality effect gains importance only with an increasing number of farmers making the same decision. In other words, the environmental damage curve representing the loss of a traditional variety due to land conversion from a traditional variety to modern varieties is increasing with increased land conversion (Swanson et al., 1994).

Farmers are often characterized in the literature as the main load-bearing actors in in situ conservation of PGRFA (e.g., Altieri and Montecinos, 1993). Except perhaps for hobby cultivation that is found mainly in industrialized countries, farmers do not maintain PGRFA diversity for its own sake and in accordance with the three objectives of PGRFA conservation (see section 2). Thus, in situ conservation of PGRFA diversity is a positive externality of the farm activities, based on the farmers' private benefit expectations for other reasons. Hence, resource-poor as well as resource-rich farmers may produce PGRFA diversity without additional costs.

The maintenance of PGRFA diversity in farmers' fields for other reasons than PGRFA conservation may be interpreted as "de facto conservation" of PGRFA diversity (Meng et al., 1997) noted earlier. However, as long as the diversity of PGRFA is not valued in the market, and therefore providing little incentive for its conservation, the maintenance of PGRFA diversity in farmers' fields through legislative means will be negatively correlated with overall agricultural development in a specific region.

The evolution of the marginal costs and benefits in the farmers' production systems determines the level of PGRFA diversity selected and thus the positive external effect generated for all the beneficiaries of PGRFA diversity without costs. Some farmers may conserve PGRFA diversity in a de facto manner by utilizing farmers' varieties on their whole farm (mainly resource-poor farmers) or only on parts of it, in spite of access to modern varieties and the agroecological possibilities (mainly resource-rich farmers). They do so because the private anticipated benefit to their production systems (including traditional varieties) in terms of insurance, breeding, taste, and so forth, is higher than that of an alternative system (including a higher or total share of land sown to modern varieties) (Virchow, 1999; Brush and Meng, 1996). This de facto conservation may imply that the marginal benefits of maintaining and utilizing a high quantity of traditional varieties is higher for resource-poor farmers than for resource-rich farmers (see Fig. 6-3).

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