Diversification in peri-urban agriculture: a case study in the Ruhr metropolitan region

Manuela Meraner,Bernd Pölling,Robert Finger

doi:10.1080/1747423x.2018.1529830

Abstract

ABSTRACTFarm diversification is of growing importance for European farmers to stabilize and/or increase their income, especially in urban and peri-urban areas. This article identifies determinants of the uptake and intensity of on-farm non-agricultural diversification such as agritourism activities, on-farm processing and direct sales activities in the Ruhr metropolitan region in Germany based on a survey among 156 farms. We find a high share of diversified farms in the Ruhr metropolitan region, often with more than one diversification activity. Environmental, farm and farmer characteristics have distinctive effects on the farmers’ diversification decision and the farmers’ decision on the diversification intensity. Younger, risk seeking farmers with secured farm succession and less productive soils are more likely to choose on-farm non-agricultural diversification. Additionally, we find that diversification intensity is positively influenced by proximity to urban areas, as well as a specialization on high value crops and the usage of extension service consultancy.

Highlights

The importance of farm diversification to stabilize farm incomes and income risk has rapidly grown over the last years (McNamara and Weiss, 2005, European Parliamentary Research Service, 2016)
We find that farmers with a higher level of education are less likely to start with a diversification activity
We developed an econometric hurdle model that explains determinants firstly, of the discrete choice of adoption or non-adoption of a diversification activity and secondly, of the intensity of diversification, measured as a count of adopted on-farm non-agricultural diversification activities in the Ruhr metropolitan area

Summary

Introduction

The importance of farm diversification to stabilize farm incomes and income risk has rapidly grown over the last years (McNamara and Weiss, 2005, European Parliamentary Research Service, 2016). The uptake of on-farm non-agricultural diversification activities is large in farming systems in urban and peri-urban areas (Ilbery, 1991, Zasada, 2011). Typical city-adjustment strategies of peri-urban farms to take advantage of the large consumer potential and to cope with urban constraints are high-value production, product niches, short supply chains, alternative food networks, and non-agricultural diversifications (Heimlich and Barnard, 1992, Gardner, 1994, Zasada, 2011, Aubry and Kebir, 2013, Lange et al, 2013). We consider farms as diversified if farm resources (land, labor or capital) are used on the farm for activities other than production of conventional crops and livestock to generate income e.g. on-farm non-agricultural diversification (Meraner and Finger 2017a). Our findings on the influence of environmental factors, farm, farmer and household characteristics on diversification intensity will add to the existing literature on the binary choice to diversify or not by expanding to a diversification portfolio

Case study area

Data and data collection

Results and discussion

Conclusion