FARManalytics – A bio-economic model to optimize the economic value of sustainable soil management on arable farms

Soil quality is an important determinant of agricultural productivity and environmental quality. Despite its importance, few economic models incorporate sustainable soil management. The objective of this study is to develop and illustrate FARManalytics: a bio-economic model to gain quantitative insight in the economic value of sustainable soil management. First, we defined a comprehensive set of chemical, physical and biological soil quality indicators and quantitative rules on how these indicators respond to farmers’ production management over time. Second, we introduce an economic calculation framework that enables accurate calculation of the contribution of different production management decisions towards farm income using Activity-Based-Costing. The set of soil quality indicators and economic calculations serve as the basis for the bio-economic model FARManalytics, which consists of two modules: (1) the
calculator, a module that calculates the impact of current production management on soil quality and farm economics and (2) the
optimizer, a module that uses Mixed-Integer-Linear-Programming to maximize farm incomewithin predefined soil quality indicator constraints. The decision variables are the crop rotation, cover crops, manure & fertilizer application and crop residue management. We illustrate the added value of the model by applying it to an extensive and intensive farm type, both on clay and sandy soil. These farm types are derived from the Farm Accountancy Data Network (FADN) in the Netherlands. FARManalytics demonstrates that it is possible to increase farm income with up to €940 ha−1 year−1 on clay soil and up to €683 ha−1 year−1 on sandy soil, while meeting all soil quality targets except subsoil compaction vulnerability. The latter was among the most limiting soil quality indicators for the farm types in this study, together with soil organic matter input, wind erosion vulnerability and plant-parasitic nematodes. FARManalytics integrates the impact of production management decisions on soil quality and economics at farm level. Combined with representative farm types, the bio-economic modeling approach of FARManalytics can provide useful information for policy support. FARManalytics can also be tailored to provide decision support for individual farms, based on data that is commonly available on arable farms at low cost.