August 6, 2022

Better policies to improve the environmental performance of the agricultural sector
One of the main challenges facing the farm sector is to feed a growing world population while reducing its environmental footprint and preserving natural resources for future generations.

Agriculture can have a significant impact on the environment. Its negative effects are severe and include pollution and soil, water, and air degradation. Still, it also has positive effects: crops and soils absorb greenhouse gases, for example, and some agricultural practices reduce the risk of flooding.

The OECD examines the links between the environment and agriculture, identifies effective agricultural policies that limit negative environmental impacts and enhance positive ones, and makes recommendations to improve policy coherence for the ecological performance of the farming sector.

Agriculture has reduced its environmental impact, but there is still much to do

There have been encouraging signs that the OECD agricultural sector can meet the environmental challenges in recent years. In particular, in many countries, farmers have made progress in using and managing nutrients, pesticides, energy, and water, which have been reduced on a per unit area basis. They have also significantly improved their practices through soil conservation, better manure storage techniques, and soil testing.

However, despite these improvements, much remains to be done, and governments have an important role to play. Nitrogen balances are increasing in several OECD countries, bird populations on agricultural land continue to decline, and the sector’s contribution to water use and contamination remains high relative to other services. These long-standing problems require a greater cooperative effort between farmers, governments, and actors in the agri-food value chain.

In addition, the dual challenge of ensuring food security for a growing world population while improving environmental performance will require increasing ecological and resource productivity in agriculture, improving land management practices, minimizing pollutant discharges, mitigating biodiversity damage, and strengthening policies that avoid production and input subsidies with adverse environmental impacts.

Monitoring and evaluating the environmental performance of agriculture can help governments determine future policy directions.

To help countries improve the sustainability of their agriculture, the OECD has developed a set of recommendations on how to design cost-effective agri-environmental measures, address water issues in agriculture, cope with the challenges of climate change, preserve biodiversity, and manage agriculture-related ecosystem services. We have also reflected on the potential ecological impact of agricultural policies by looking for possible misalignments and asking how to reconcile the goals of sustainability and productivity growth.

Since there may be no “one size fits all” solution to environmental problems in the agricultural sector. Since agroecological systems and public preferences vary from country to country, policymakers must access detailed information on the links between policy and outcomes. They have tools to understand and measure them to efficiently assess and improve environmental impacts.

To this end, and to help governments know whether the policies they have put in place are the most effective in boosting productivity and reducing environmental damage, the OECD has developed a set of agri-environmental indicators (AEIs) that can be used in particular to:

  • describe the current state and future trends of environmental conditions in agriculture that may require policy intervention
  • highlight emerging issues;
  • compare performance over time and across countries, in particular, to help managers meet environmental targets, thresholds, and standards that governments or international agreements have established;
  • monitor and evaluate agricultural policies;
  • forecasting future trends.

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