Balancing economic and ecological functions in smallholder and industrial oil palm plantations.

The expansion of the oil palm industry in Indonesia has improved livelihoods in rural communities, but comes at the cost of biodiversity and ecosystem degradation. Here, we investigated ways to balance ecological and economic outcomes of oil palm cultivation. We compared a wide range of production systems, including smallholder plantations, industrialized company estates, estates with improved agronomic management, and estates with native tree enrichment. Across all management types, we assessed multiple indicators of biodiversity, ecosystem functions, management, and landscape structure to identify factors that facilitate economic-ecological win-wins, using palm yields as measure of economic performance. Although, we found that yields in industrialized estates were, on average, twice as high as those in smallholder plantations, ecological indicators displayed substantial variability across systems, regardless of yield variations, highlighting potential for economic-ecological win-wins. Reducing management intensity (e.g., mechanical weeding instead of herbicide application) did not lower yields but improved ecological outcomes at moderate costs, making it a potential measure for balancing economic and ecological demands. Additionally, maintaining forest cover in the landscape generally enhanced local biodiversity and ecosystem functioning within plantations. Enriching plantations with native trees is also a promising strategy to increase ecological value without reducing productivity. Overall, we recommend closing yield gaps in smallholder cultivation through careful intensification, whereas conventional plantations could reduce management intensity without sacrificing yield. Our study highlights various pathways to reconcile the economics and ecology of palm oil production and identifies management practices for a more sustainable future of oil palm cultivation.

Transformation scenarios towards multifunctional landscapes: A multi-criteria land-use allocation model applied to Jambi Province, Indonesia.

In tropical regions, shifting from forests and traditional agroforestry to intensive plantations generates conflicts between human welfare (farmers' demands and societal needs) and environmental protection. Achieving sustainability in this transformation will inevitably involve trade-offs between multiple ecological and socioeconomic functions. To address these trade-offs, our study used a new methodological approach allowing the identification of transformation scenarios, including theoretical landscape compositions that satisfy multiple ecological functions (i.e., structural complexity, microclimatic conditions, organic carbon in plant biomass, soil organic carbon and nutrient leaching losses), and farmers needs (i.e., labor and input requirements, total income to land, and return to land and labor) while accounting for the uncertain provision of these functions and having an actual potential for adoption by farmers. We combined a robust, multi-objective optimization approach with an iterative search algorithm allowing the identification of ecological and socioeconomic functions that best explain current land-use decisions. The model then optimized the theoretical land-use composition that satisfied multiple ecological and socioeconomic functions. Between these ends, we simulated transformation scenarios reflecting the transition from current land-use composition towards a normative multifunctional optimum. These transformation scenarios involve increasing the number of optimized socioeconomic or ecological functions, leading to higher functional richness (i.e., number of functions). We applied this method to smallholder farms in the Jambi Province, Indonesia, where traditional rubber agroforestry, rubber plantations, and oil palm plantations are the main land-use systems. Given the currently practiced land-use systems, our study revealed short-term returns to land as the principal factor in explaining current land-use decisions. Fostering an alternative composition that satisfies additional socioeconomic functions would require minor changes ("low-hanging fruits"). However, satisfying even a single ecological indicator (e.g., reduction of nutrient leaching losses) would demand substantial changes in the current land-use composition ("moonshot"). This would inevitably lead to a profit decline, underscoring the need for incentives if the societal goal is to establish multifunctional agricultural landscapes. With many oil palm plantations nearing the end of their production cycles in the Jambi province, there is a unique window of opportunity to transform agricultural landscapes.

Agrarian change, livelihood dynamics and welfare outcomes: Evidence from plantation crop farmers in Indonesia.

In the tropical belt of Africa, Asia, and the Americas, smallholder farming is undergoing a significant transformation from subsistence-oriented to highly specialized and market-oriented plantation systems. While understanding the transition of livelihoods of plantation farm households over time is an important development goal, available empirical evidence is scant. This study provides the first quantitative evidence on the dynamics, transitions, and determinants of livelihood strategies linked to the crop choices of commercial farm households in the tropics. We use three-wave panel data of oil palm and rubber farmers from Indonesia for the empirics. Particular emphasis is placed on the trade-offs smallholders face in growing these two crops. Employing the dynamic livelihood strategy framework and Latent Markov Model estimations, we reveal that even highly specialized farm households pursue diversified livelihood strategies, and they actively switch between the identified strategies. Over time, significant changes are observed in the composition of strategies, which continue to be dominated by oil palm-oriented and off-farm-based activities. Inter alia, climate anomalies and a decline in oil palm and rubber prices influence the dynamics and trajectories of the livelihood strategies. We also find that a larger farm size possibly hinders households' labor allocation to more remunerative off-farm activities, implying that possessing a larger farm-land alone may not suffice for improving farmers' wellbeing. We conclude by discussing the generalizability of our findings and providing implications for future research and policymaking.

Rural food security, subsistence agriculture, and seasonality.

Many of the world's food-insecure and undernourished people are smallholder farmers in developing countries. This is especially true in Africa. There is an urgent need to make smallholder agriculture and food systems more nutrition-sensitive. African farm households are known to consume a sizeable part of what they produce at home. Less is known about how much subsistence agriculture actually contributes to household diets, and how this contribution changes seasonally. We use representative data from rural Ethiopia covering every month of one full year to address this knowledge gap. On average, subsistence production accounts for 58% of rural households' calorie consumption, that is, 42% of the calories consumed are from purchased foods. Some seasonal variation occurs. During the lean season, purchased foods account for more than half of all calories consumed. But even during the main harvest and post-harvest season, purchased foods contribute more than one-third to total calorie consumption. Markets are even more important for dietary quality. During all seasons, purchased foods play a much larger role for dietary diversity than subsistence production. These findings suggest that strengthening rural markets needs to be a key element in strategies to improve food security and dietary quality in the African small-farm sector.

Production diversity and dietary diversity in smallholder farm households.

Undernutrition and micronutrient malnutrition remain problems of significant magnitude in large parts of the developing world. Improved nutrition requires not only better access to food for poor population segments, but also higher dietary quality and diversity. Because many of the poor and undernourished people are smallholder farmers, diversifying production on these smallholder farms is widely perceived as a useful approach to improve dietary diversity. However, empirical evidence on the link between production and consumption diversity is scarce. Here, this issue is addressed with household-level data from Indonesia, Kenya, Ethiopia, and Malawi. Regression models show that on-farm production diversity is positively associated with dietary diversity in some situations, but not in all. When production diversity is already high, the association is not significant or even turns negative, because of foregone income benefits from specialization. Analysis of other factors reveals that market access has positive effects on dietary diversity, which are larger than those of increased production diversity. Market transactions also tend to reduce the role of farm diversity for household nutrition. These results suggest that increasing on-farm diversity is not always the most effective way to improve dietary diversity in smallholder households and should not be considered a goal in itself. Additional research is needed to better understand how agriculture and food systems can be made more nutrition-sensitive in particular situations.