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In Olivier, A. and S. Campeau, eds. 2007. When Trees and Crops Get Together. Proceedings of the
10th North American Agroforestry Conference, Québec City, Canada, June 10-13, 2007. 219
ADOPTION AND ECONOMICS OF SILVOPASTURE SYSTEMS
BY FARM SIZE IN NORTHEASTERN ARGENTINA
Gregory Frey1, Hugo Fassola2, Nahuel Pachas2, Luis Colcombet2,
Santiago Lacorte3, Frederick Cubbage1 and Oscar Pérez4
1North Carolina State University, Dept. of Forestry and Env. Res., Raleigh, NC 27695, U.S.A
2Instituto Nacional de Tecnología Agropecuaria, EEA Montecarlo, Misiones, Argentina
3Instituto Nacional de Tecnología Agropecuaria, CR Misiones, Posadas, Misiones, Argentina
4Universidad Nacional de Misiones, Fac. de Ciencias Forestales, Eldorado, Misiones, Argentina
Contact: gefrey@ncsu.edu
Abstract: Differences between the theoretical benefits and the actual adoption of silvopasture
systems among farmers have prompted researchers and extension agents to learn more about the
adoption mechanisms for silvopasture systems. In the past decade, farmers in northeast
Argentina’s Misiones and northern Corrientes provinces have begun adopting silvopasture
systems to a moderate extent. Interestingly, adoption has occurred among small-, medium- and
large-scale farmers, either through individual decisions, or spurred by extension education and
financial subsidy payments. This unique situation allows us to explore potential differences and
similarities between the adoption and implementation of silvopasture between farmers of
different scales. A survey of managers of the three farm scales in Misiones and northern
Corrientes was used to determine advantages and disadvantages of the system, as perceived by
managers. In addition, farmers were asked to describe economic costs incurred and benefits
received from the silvopasture parcels. These data were used to compare the perceived merits,
likelihood of continuance and production levels for silvopasture systems among the different
farm-scale levels.
Key Words: Adopter perceptions, productivity, farm scale, silvopasture.
INTRODUCTION
Silvopasture systems have been shown to have potential profitability in many parts of the world
(Dangerfield and Harwell 1990; Clason 1999; Clason and Sharrow 2000; Grado et al. 2001;
Colcombet et al. 2004; Esquivel et al. 2004; Fassola et al. 2004a), yet are not commonly adopted
(Garrett et al. 2000; Rapey et al. 2001; Dagang and Nair 2003; Stainback and Alavalapati 2004).
Where silvopasture is practiced in the Americas, it is most often practiced by large landholders.
Even in countries where small landholders own livestock, it is relativly rare to see pastures
integrated with forestry systems. There are several possible barriers to adoption of silvopasture
systems for small-scale farmers with limited resources (Dagang and Nair 2003; Pagiola et al.
2004). If we are to expect good adoption of silvopasture systems among small farmers, we should
properly understand their motivations and expectations (Dagang and Nair 2003; Shrestha et al.
2004).
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One possible explanation for the differential in adoption between small and large landholders is
that silvopasture systems exhibit increasing returns to scale. Under this hypothesis, increasing all
of the inputs would increase output more than proportionally. Small farmers would not be able to
access these efficiencies. We are unaware of any research that has estimated the production
efficiencies of silvopasture of varying scales. All financial analyses to date have assumed
constant costs and benefits per hectare (i.e. a linear relationship between land area and yield;
constant returns to scale). This may be a naïve approach to modeling silvopasture.
This study uses direct survey methods to qualitatively investigate the motivations behind
silvopasture adoption among farmers of different scales in northeastern Argentina, and whether
adopters are likely to continue use of the system. Then, we use farmers’ estimates of past and
future costs and benefits to approximate economic returns for different farm scales. Our study is
not designed to answer definitively all these questions, but rather to be a starting point for future
research in the area.
MATERIALS AND METHODS
Description of the study area
The northeastern provinces of Misiones and northern Corrientes, Argentina, have experienced
moderate adoption of silvopasture systems in recent years among farms of all scales. Esquivel et
al. (2004) estimated that, assuming constant returns to scale at a 7% discount rate, silvopasture
yielded an equivalent annual income of 441 Argentine pesos (US$ 1 = Ar$ 3.085 in June 2006)
per hectare, higher than alternative agriculture, cattle-ranching or forestry systems. Silvopasture
implementation had reached an extent of approximately 10,000 hectares by 2004 (Esquivel et al.
2004). In general, these systems integrate a tree component of Pinus spp., Eucalyptus spp. or the
native Araucaria angustifolia with native (e.g. Axonopus compressus) or exotic (e.g. Brachiaria
brizantha) forage species and cattle.
A diversity of farm types exit in Misiones and Corrientes. Northern Corrientes and southwestern
Misiones are flat prairie-land, which has been traditionally used for cattle grazing. Central and
northern Misiones consists of a forest zone, which has been settled for agriculture, with some of
the more remote areas still relatively undisturbed (Fassola et al. 2004b). This area is utilized by
semi-subsistence and cash-crop farmers, including forest-product firms (who primarily plant
Pinus spp.).
Adoption of silvopasture was spurred on when the national government of Argentina began
offering cost-share payments to offset a portion of the costs of site preparation and planting trees
starting in 1999 (Congreso 1998). This program functioned fairly well until the Argentine
economic crisis of 2001. A number of large-scale cattle ranchers as well as medium- to large-
scale forest plantation firms have adopted silvopasture systems. We should note that forest-
product firms would have received the cost-share payments anyway; the decision to adopt
silvopasture was made independent of this policy. Also, special extension programs, including in-
kind provision of necessary capital for starting silvopasture parcels, have convinced a relatively
few small-scale farmers to adopt the system.
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Farm survey
A farm survey of silvopasture adopters was conducted in the Misiones and northern Corrientes
provinces of northeastern Argentina during June and July of 2006. A purposive sample of
adopters of varying farm scales was selected throughout the region to participate in the survey.
These were identified by researchers and extension agents at the Instituto Nacional de Tecnología
Agropecuaria (INTA), who were familiar with the region. Personal interviews about opinions of
silvopasture systems, farm inputs and budgets, and producer success were conducted.
In total, 38 silvopasture practitioners of varying scales were interviewed, producing 35 usable
responses. Farm size (including all properties of the same owner in relatively close proximity)
ranged from 20 to 14,000 hectares with a mean of 1536 ha and a median of 280 ha. Surveyed
farmers were classified into three groups using natural clusters: small-scale (20-50 hectares),
medium-scale (90-800 ha) and large-scale (>1100 ha). There were 13 small-, 10 medium- and 12
large-scale farmers in the sample.
Farmers were asked qualitatively about the advantages and disadvantages that they perceived in
the silvopasture system at two points in time, at the time of the adoption decision and in the
present (i.e. during implementation of the system). They were asked whether they would be likely
to continue practicing silvopasture systems given the current prices and incentive policies. Each
of these questions was open-ended, that is, no list of possible responses was given. Farmers were
permitted to give as many responses as they felt appropriate.
Farmers were also asked in detail about the inputs and outputs received from silvopasture. They
were asked to state, whenever possible, actual costs and benefits incurred up to 2006 for a
specific silvopasture plot, based on recall. For future inputs and outputs, farmers were asked to
give realistic estimates based on their knowledge.
Inputs included capital and labor for site preparation and planting, thinning and pruning, annual
weeding and control of insects, daily livestock management, etc. Outputs included sale or
household consumption of timber, sale or household consumption of livestock and milk, etc.
Most farmers could recall fairly detailed information over a long period about relatively
infrequent events (pruning, sale of timber, etc.) but could not report with certainty about long-
term information regarding frequent events (livestock management). Therefore, farmers were
asked to estimate costs and benefits from livestock management in silvopasture systems only
over a one-year period (June 2005-May 2006).
Farmers were asked to estimate the 2006 height and diameter at breast height (DBH) of the trees
in the silvopasture system. When possible, sample measurements of height and DBH of trees in
the silvopasture plot were taken using a random plot design.
Data analysis
Responses for perceived (qualitative) advantages and disadvantages, and for the perceived
likelihood of continuance of silvopasture were pooled into similar responses. Responses were
compiled into the three farm-scale groups.
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Data on the economic (quantitative) costs and benefits were compiled into spreadsheets to
calculate the equivalent annual income (EAI) for silvopasture on each farm (Jacobson 1998),
using a 7% discount rate. Because of the multiple-input, multiple-output nature of silvopasture,
and varying rotation lengths, EAI in monetary terms was used as a measure to compare
productivity. While prices were necessary in order to put inputs and outputs into common units,
the actual peso amounts may not have meaning in real terms. Prices from region to region may
vary somewhat, so a set of common prices in were used for inputs (e.g. labor, chemical
treatments) and outputs (e.g. pulp, timber, beef, milk) in order to measure actual production
rather than spatial and temporal anomalies in the market. Incentive payments were not taken into
account and in-kind support of supplies was treated as if the farmer had purchased the materials.
Based on past and present management and the current measurements, we used the
SIMULADOR FORESTAL (Crechi et al. 1997) program to estimate future timber harvests.
Inputs and outputs for livestock, based on the 2005-2006 data, were estimated from year 3 to
rotation completion.
Because the land used for adoption of a silvopasture system in each case belonged to one of many
possible starting scenarios, the costs of site preparation are inherently different in each case.
Cases existed in which the silvopasture system was planted on clear-cut plantation forest, annual
cropland, pasture and degraded native forest. In order to compare costs and benefits of the current
management without being biased by the starting condition of the land, each EAI was adjusted
(AEAI) to reflect a starting situation of clear-cut plantation forestland, using the difference in
average costs for site preparation (Colcombet 2005) between the actual starting condition and
clear-cut forest. This is consistent with the land being replanted to silvopasture after the current
timber rotation is completed.
RESULTS AND DISCUSSION
Perceived advantages and disadvantages
In many cases, the perceived advantages and disadvantages of the system varied from the point in
time before adopting the system to the present. Among the 35 farmers interviewed, the most
common responses for advantages and disadvantages are listed in Tables 1 and 2, respectively.
In general, there were fewer negative responses about silvopasture systems than positive
responses. It is important to note that, since the sample was only of adopters, there is a form of
self-selection bias in the sample. Adopters most likely believed from the beginning that the
system would offer something positive. However, the study does provide one of the first
comparisons of perceptions of various advantages or disadvantages across farm-scale groups or
across time frames.
Currently perceived advantages
When farmers were asked what advantages they see in silvopasture at the present, the most
common response was that silvopasture systems provide microclimate benefits for livestock
management (Fig. 1). Large- and medium-scale managers were more likely to give this response
THE 10TH NORTH AMERICAN AGROFORESTRY CONFERENCE, QUÉBEC CITY, 2007
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than small-scale farmers. The second most common response in general, and the most common
response among small-scale farmers, was that silvopasture systems have good cash-flow
qualities. In particular, sale of cattle and frequent forest thinnings can provide short- to medium-
term income, while the growth of sawtimber acts as a long-term investment. The fact that cash
flow benefits were the most common response among small-scale farmers corresponds well to the
fact that in developing regions it is difficult for small-scale farmers to access credit (or savings
accounts). In addition, because of the past instability of the Argentinean currency, real assets
including land, livestock, and trees may have exceptional value still in the country.
Table 1: Most common perceived advantages of silvopasture systems. Responses with less than a
15% frequency among all groups were omitted for brevity.
Advantage Explanation
Cash flow The silvopasture system products (livestock, thinned timber and final sawtimber) operate on
different time scales.
Practical Silvopasture provides a low-cost way to combine two activities that farmers were practicing
anyway.
Profitable Silvopasture systems provide more profit than alternative production systems in the region.
Microclimate In the summer, shade reduces heat stress on the livestock. Also, reduced heat stress on the forage
helps keep it tender and palatable in the summer. In the winter, trees provide some shelter against
frost.
Weed control Livestock help combat shade-tolerant weeds which would otherwise need to be sprayed in forest
plantations. Trees shade out some aggressive shade-intolerant weeds.
Fire control Livestock reduce the amount of dry matter under the forest, and thus reduce the risk of
catastrophic forest fires.
Erosion
control
Compared to other production systems, silvopasture provides a high degree of soil cover.
Dual use The system produces two products, timber and livestock, from the same parcel of land.
Timber quality The silviculture implied by a silvopasture system (high intensity of pruning and thinning) leads to
a high-quality end product (high grade sawtimber or veneer with few knots).
Table 2: Most common perceived disadvantages of silvopasture systems. Responses with less
than a 15% frequency among all groups were omitted for brevity.
Disadvantage Explanation
Uncertainty There are two forms of uncertainty: 1) being a new technology, relatively few studies have been
conducted, leaving farmers to trial and error, and 2) institutional instability in Argentina creates
uncertainty in prices, export policy and the continuance of the cost-share program.
Capital The investment required for the purchase of seedlings, herbicides, pesticides, etc. can be high.
Competition Competition between the tree and forage components for light, water and nutrients can decrease
the growth of both.
Complexity The system requires a very intensive management regime and can be quite difficult for those
uninitiated in the management of one of the components.
Health Wooded areas provide habitat for an increased quantity of livestock pests, such as ticks.
High percentages of respondents also answered that silvopasture provided the benefits of two
products from the same plot of land and weed control. Small farmers tended to respond that the
“dual-use” of land was a benefit while medium and large farmers were more pleased with the
benefit of weed control.
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Fig. 1: Currently-perceived advantages of silvopasture. Frequency of response for various
perceived advantages, by farm-scale groups. Responses with less than a 15% frequency among
all groups were omitted for brevity.
Fire control was an important response for large- and medium-scale farmers. This may partially
reflect the fact that the more fire-prone, savanna areas of the region are generally divided into
much larger landholdings, while areas of native forest are less likely to have major difficulties
with fire and have been colonized more recently by small-scale farm families.
There were substantial differences between the benefits farmers believed they would receive
when they adopted the systems and the benefits they actually felt were the most important now
that they have significant experience with the system. In particular, improved “microclimate”
increased in perceived importance, surpassing “dual-use” of land, which decreased in frequency
of response. In addition, “cash flow” became an increasingly important benefit, especially for
small-scale farmers.
In general, it appears that small-scale farmers focused mostly on more direct financial benefits of
the system, while large- and medium-scale farmers perceived the technical benefits of the system
as more advantageous (although technical benefits such as microclimate and fire control do have
a financial side).
Currently perceived disadvantages
The most common concerns among farmers at the present are competition between trees and
forage plants for light, water, etc., and the complexity of system management (Fig. 2). Farmers
have fewer concerns about silvopasture in the present, now that they have experience with the
system, than before adoption. There is a decreased importance of concerns about plant
competition relative to system complexity, indicating that farmers now realize that there are
0
10
20
30
40
50
60
Microclimate
Cash flow
Dual use
Weed control
Fire control
Profitable
Erosion control
Practical
Timber quality
Response
%
All farmers
Large scale
Medium scale
Small scale
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many ways of managing the competition among plants, although this management requires much
planning.
Fig. 2: Currently-perceived disadvantages of silvopasture. Frequency of response for various
perceived disadvantages, by farm-scale groups. Responses with less than a 15% frequency
among all groups were omitted for brevity.
The only disadvantage of silvopasture that was perceived to be more important currently than it
was at the time of adoption is the requirement of investment capital to start the system. Normally,
we would think that this would be a more important disadvantage when farmers are considering
adoption, since this is when most of the investment would take place. However, most of these
farmers initially adopted silvopasture before 2001, when cost-share and in-kind support programs
were more easily accessible. It is likely that they did not view the capital requirement as a barrier
at the time of adoption because of the availability of these programs, which may no longer be a
feasible alternative. It is interesting that no small-scale farmers voiced this concern.
Likelihood of continuance
The majority of farmers indicated that they had received help starting the silvopasture system
either through government cost-share programs or in-kind support. By a wide margin, farmers
indicated that they would probably increase the area of land given to silvopasture if cost-share or
in-kind support programs continued (Fig. 3). Small farmers seemed somewhat less likely to state
that they would increase the area of their land dedicated to silvopasture, but this is at least in part
due to the fact that small farmers are more land-constrained, and most high-productivity areas are
used for annual subsistence or cash crops.
0
10
20
30
40
50
60
Competition
Complexity
Uncertainty
Capital
Health
Response
%
All farmers
Large scale
Medium scale
Small scale
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Fig. 3: Likelihood of continuance of silvopasture system area, with current prices and incentive
policies.
In addition, the majority of farmers, particularly large- and medium-scale farmers, indicated that
they would continue implementing silvopasture systems, even if no government support were
provided (Fig. 4). This is a good indication that these farmers believe that silvopasture is
beneficial to them. Furthermore, these data seem to indicate, to some degree, that the hurdle of
convincing farmers to install silvopasture is a one-time barrier.
Fig. 4: Likelihood of continuance of silvopasture system area, with no incentive policies
Economic results
Adjusted equivalent annual income (AEAI) was highly sensitive to changes in the wage rate. This
is significant because small-scale farmers substitute labor for capital. Small farms had a much
0
10
20
30
40
50
60
70
80
90
100
Increase Maintain Decrease
All farmers
Large scale
Medium scale
Small scale
0
20
40
60
80
100
Increase or Maintain Decrease
All farmers
Large scale
Medium scale
Small scale
THE 10TH NORTH AMERICAN AGROFORESTRY CONFERENCE, QUÉBEC CITY, 2007
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higher AEAI when the wage rate of Ar$ 15 per day was used (often cited by small farmers as the
cost of hiring a hand for a day), while large farms were more productive at a wage of Ar$ 58.41
per day (the official minimum wage for unskilled labor, including taxes and other costs for which
a firm may be responsible, such as food and transportation; Fig. 5). At Ar$ 38.90 (the official
minimum wage for unskilled labor, including taxes), the three farm scale groups had very similar
AEAIs, with small farms slightly higher. At Ar$ 38.90, the rate most commonly used in cost-
benefit financial analyses, the overall mean was Ar$ 406, which is close to the value estimated by
Esquivel et al. (2004) (Ar$ 441). When considering only farms from north-central Misiones, the
region considered by Esquivel et al. (2004), our mean total AEAI was Ar$ 442.
Fig. 5: Adjusted Equivalent Annual Income (AEAI) per hectare for farms of varying scales at
varying wage rates.
The fact that small-scale farmers have equal or higher AEAI at low and intermediate wage rates
means that we cannot reject the assumption of constant/decreasing returns to scale. Increasing
returns to scale do not conform to the data, and would not appear to be an important factor in
preventing small-scale farmers from adopting silvopasture systems.
CONCLUSIONS
Small, medium and large farmers in Northeastern Argentina demonstrated different perceptions
of silvopasture systems. Small farmers are interested in the financial advantages of having short-,
medium- and long-term cash flow, while larger-scale farmers seem to appreciate technical
benefits such as improved microclimate, weed control and fire control. Extensionists and
researchers should keep in mind the benefits farmers believe to be the most important when
conversing with potential future adopters and when comparing production systems.
The question of whether or not the front-end investment in silvopasture is too much for farmers
to overcome is still an interesting one and merits more precise research. The majority of all
adopters surveyed indicated that they would continue implementation or even expand
0
100
200
300
400
500
600
700
800
Ar$ 58.41 Ar$ 38.90 Ar$ 15.00
Cost of Labor per Day
AEAI (Ar$)
All Farmers
Large Scale
Medium Scale
Small Scale
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silvopasture on their lands, with or without cost-share or in-kind benefits. In addition, only a
relatively few farmers believed that the high investment cost was a disadvantage of the system.
However, it is questionable whether or not new farmers, particularly small farmers with limits on
capital, are likely to adopt the system without some form of incentives. Small-scale farmers did
not cite capital costs as major concern. These results indicate that adoption will probably
continue.
The economic analysis of productivity for the different farm scales provided insight into the
substitution of capital for labor under differing wages. The data do not support increasing returns
to scale. However, a method that does not depend on input/output prices, such as data
envelopment analysis, may help to illuminate further these results.
Overall, the results of this study do indicate that silvopasture systems have significant benefits to
farmers who adopt them, of all scales. Further research in other countries in the Americas may
help determine their applicability in other locations where good livestock and forest products
markets exist. The results also can inform future research on economic analyses of silvopasture
systems and differences by ownership size.
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