Environmental Efficiency and Pollution Costs of Nitrogen Surplus in Dairy Farms: A Parametric Hyperbolic Technology Distance Function Approach

Abstract

Negative externalities such as nitrogen (N) surplus that accompany dairy production activities are not usually accounted for in the market place since they are not costed. Using a parametric hyperbolic environmental technology distance function approach, we estimate the environmental efficiency and farm-specific abatement costs (shadow price) of nitrogen surplus in dairy farms on the island of Ireland (Northern Ireland and the Republic of Ireland). The methodology, unlike previous approaches (output/input distance functions), allows for asymmetric treatments of production outputs (desirable and undesirable outputs). We also analyse the farm level nitrogen pollution costs ratio and its determinants. The results of our analyses showed that the average environmental technical efficiency estimates for the Republic of Ireland and Northern Ireland are 0.89 and 0.92 and the mean abatement costs per kg of N surplus is €4.02 and €6.2 respectively. We found a reasonable degree of variation in the spectrum of abatement costs across the dairy farms with a relative increase observed over the years.

Estimation of genetic parameters for predicted nitrogen use efficiency and losses in early lactation of Holstein cows

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“…Improving nitrogen efficiency has become a key target in dairy production systems for several reasons. First, nitrogen losses from dairy systems have a direct effect on the environment and ecosystems (Adenuga et al, 2019). Volatilization of nitrogen from feces and urine as ammonia contributes to acidification of water and soils, and losses as oxides of nitrogen contribute to global climate change (Castillo et al, 2000;Kebreab et al, 2001).…”

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