Vincent de Leijster

26 Chapter 2 2.2 Economic and agronomic conditions The price of organic almonds has increased significantly since 2005, with a strong peak in 2015 (Figure 2-2; Lonja de Reus, 2019). This peak can be explained by a shortage in supply, caused by extreme droughts in the world’s main almond producing area, California (USA). The productivity of almonds in Almería and Granada has increased strongly (Junta de Andalucía, 2020), and this may be explained by an increase in mechanization. The amount of land used for almond cultivation is also rapidly expanding in this area, having increased by 18% between 2014 and 2017 (Junta de Andalucía, 2020). The fast increase in market price may have attracted more intensive agricultural enterprises that are more productive than the traditional extensive almond producers, leading to an increase in almond land cover and productivity. Around a third of the almond producers on the high plains are producing organically (Junta de Andalucía, 2020), and thus these producers are receiving price premiums and higher public subsidies. Furthermore, the farmers’ association ‘Almendrehesa’ offers a price premium to regeneratively produced almonds; this means that plantations should have vegetation covers or strips and soils are enriched with compost or manure. Currently, there is no payment for ecosystem service (PES) instruments in place that compensate farmers for carbon sequestration or for erosion control. In the current study I have explored the potential of such instruments to contribute to farm profitability. The coffee production in Latin America, and specifically in Colombia, has been severely affected by coffee leaf rust. Since the introduction of new rust-resistant varieties in 2009, Colombian productivity has increased (Minagricultura, 2020). Coffee prices are generally low, and for many smallholders barely high enough to compensate their costs (FNC, 2020). More recently, the production and trade of specialty coffee has grown in Colombia, giving farmers the opportunity to sell higher quality coffee for higher prices. Traditionally, coffee was sold to ‘La Cooperativa’, the trading branch of the National Federation of Coffee Growers (FNC), but more recently farmers have also been able to sell to private intermediaries, farmers associations or direct to multinational trading companies. Certificates that correspond to small price premiums are accessible via La Cooperativa and multinationals, but not via the other intermediaries. Fair Trade, Rainforest Alliance, UTZ and 4C are certificates that are commonly supplied. There are no public incentive schemes (subsidies) or other private PES instruments that compensate for specific environmental services (such as carbon sequestration). In Chapter 6 I explore to what extent payment for carbon storage can contribute to coffee farm profitability.