Wednesday, December 12, 2012

Fallow Land Rehabilitation Program in the news

Various media outlets (exampleexample) have been reporting for months on the government's plan to revitalize fallow land...

From RTI:
"Of Taiwan's 460,000 acres of farmland, more than 30,000 acres have been fallow for five years; 46,000 acres have been fallow for two years; 50,000 acres have been fallow for a year," said Chen.

The current system offers stipends to encourage land to go fallow. It was implemented when Taiwan was preparing to join the WTO in 2002. The country wanted to cut its own grain production at the time to allow an influx of imported staple foods.
In other words, the US demanded that Taiwan curtail its own rice production to permit imports of rice from the US. The results were of course pernicious, as I observed a couple of years ago:
In Taiwan the government runs a set-aside program for farmland under which large quantities of farmland lie fallow. In some years the amount set aside exceeds the amount planted in rice (!). This program has come under much criticism, since sometimes farmland becomes unusable after being set aside and land lying uncared for invites pests that affect nearby farms. This results in abandoned land, 50,000 hectares by one 2004 estimate. When land leaves the market, it drives up the price of remaining land, pushing up rents -- and many farmers are renters, not owners. Further, for many observers it makes little sense to set aside good farmland in the lowlands while permitting farming on slopes. The set aside program is also driven by shortages of water, diverted for industrial and residential needs. Everything is exacerbated by the lack of government oversight and monitoring, a persistent problem in all areas of government policy in Taiwan.
Another long-term process, still being felt, is the change in demand for rice as Taiwan's food desires changed. As demand for meat grew in the 1970s and stimulated local livestock production, this drove demand for feed crops for the animals, which in turn pushed farmers to switch from rice to feed crops for animals. This reduced the land in rice, especially since the government set a price floor for feed crops in the 1970s. Accession to the WTO slammed rice production further.This journal article has the call:
To prepare for joining the WTO in 2002, the Taiwanese government implemented a new plan in 1997, the “Adjustment of Paddy Field and Uplands Utilization Program,” to cushion the adverse effects of agricultural trade liberalization on domestic farmers. According to the negotiated schedule for opening the rice market, Taiwan was required to import a specified amount of brown rice annually, roughly 8% of annual domestic rice consumption, before the rice market was completely opened. The additional supplies of rice from imports (about 144,000 tons of brown rice) represent a need to reduce further rice production, which will be met by letting an additional 40,000 ha of paddy fields go fallow (Shi, 2002). Thus, the goal of rice production in Taiwan has changed from self-sufficiency to a demand–supply balance (Lee et al., 1997).

Additionally, as a developed economy, Taiwan was required to reduce its AMS [ag subsidies] by 20%. To achieve this goal, the Taiwanese government reduced the land growing forage crops at a guaranteed price, and further encouraged diversion to different plants and fallow lands. The area planted with feed maize decreased accordingly and fell to the level it was in the late 1960s.
Finally a 2007 a revision to the village rebuilding law permitted the further conversion of 160,000 ha of farmland for the construction of "idyllic communities."

A FocusTaiwan piece offers a few pertinent observations from Agricultural Minister Chen on what is driving the new law:
Chen said the total acreage of local rice paddies has decreased from some 600,000 hectares 30 years ago to about 250,000 hectares at present.

In contrast, the acreage of fallow farmland has increased steadily since Taiwan's accession to the World Trade Organization in 2002 and has exceeded 200,000 hectares by now.

Which large plots of farmland are left idle, their owners can still receive subsidies. "The phenomenon violates the principle of fairness and justice," Chen said, adding that the Council of Agriculture (COA) needs to take actions to improve the situation.
The piece then offered a translation of a UDN article on the new policy giving details:
At present, farmland owners are entitled to receive NT$90,000 (US$3,072) per hectare in two installments annually if their farmland is left fallow.

Under the COA's new fallow farmland revitalization project, land owners can only receive NT$45,000 in subsidy annually for fallow farmland.

The restriction is aimed at encouraging landlords to plant crops for at least some months instead of leaving their land plots fallow all year long.

If landlords are unable to plow their farmland, the COA-backed farmland bank will help mediate leasing deals for them during a grace period from 2013 to 2014.

During this period, landlords will be given an additional NT$20,000 in farmland maintenance subsidy.

Owners of land plots that are unsuitable for farm produce plantation or are reserved for ecological conservation will be offered NT$68,000 in subsidy in two installments annually. The COA will also help landlords to transform their land plots for other usage.

Chen said the new project will need a annual budget of NT$11 billion, the same amount needed for the current project.
Under the new laws, the government promotes production while reducing fallow land without a change in budget. This is ok if you are a young farmer, but older farmers who leased land long-term and invested in new equipment to farm it expecting X amount of subsidy, as the UDN piece goes on to point out, will now be getting 1/2X. Ths policy might encourage land sales by debt-stressed farmers to developers, which unfortunately Taiwan has no shortage of.

Lawmakers criticized the new policy (TT) which places control of production in the hands of local governments (read: patronage networks and local clan and faction systems):
However, the council is failing to control production and supply under its current policy, which leaves 60 percent of activated fallow land for local governments to decide which crops to grow and does not regulate the plantation of import substitution crops, such as flint corns, sugarcanes, soybeans and wheat, the lawmaker said.

The council’s planning and seasonal adjustments would be crucial for the farmers, otherwise the farmers could be exploited by middlemen or farmers in various regions could cultivate the same crops, which would result in lower prices, he added.

DPP Legislator Huang Wei-cher (黃偉哲) said the central government would be in a better position to monitor and control production and supply than local governments.
The new policy also encourages farmers to plant corn and wheat, two crops not particularly suited for northern Taiwan. The policy -- of course not, why even say it? -- also appears to contain no promotion of sustainable, organic, or permaculture farming. Hope I am wrong....

REF: Experimental Forestry Project to restore fallow land.
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Michael Turton said...

Anon criticizing my remarks on US policy, you commented on wrong post.

L. Vivian said...

Dear Michael,

I'm Vivian, the assistant of your summer course in Chung Hsiung University two years ago.
How time flies.
I am now a graduate student in Japan and doing research about agriculture situation of Taiwan. I incidentally clicked into this page and found the writer is you!
How are you doing?
Thanks for your article!