# The Framework

Livestock raising is carried out in many forms, usually referred to as production systems or agro-ecosystems. Production systems evolve as a result of agro-ecological potential, the relative availability of land, labour and capital and the demand for livestock products. Many production systems are currently at a sustainable equilibrium, with livestock being produced in harmony with nature and in environmentally sound systems. However, over the last decades, several production systems have lost this equilibrium because of the pressure caused by growing human populations and increased demand for animal products. This chapter first provides an overview of the main production systems, the relative changes in the importance of these production systems and how these changes will affect the resource base in the future. It then presents the framework used to understand the nature and causes of livestock-natural resource interactions, and the policy changes and technology innovations which can be used to influence these interactions.

Livestock production systems and the main environmental challenges

Based on the degree of integration with crops and its relation to land, the world's livestock sector has been classified in this study into three broad livestock production systems (Sere and Steinfeld, 1996), i.e. grazing, mixed farming and industrial systems. For land-based production forms, i.e. grazing and mixed farming systems, a sub-division is then required to allow for differences caused by agro-ecological conditions and the ways in which livestock affect the natural resource base. The broad categories are:

Grazing systems. These are systems based almost exclusively on livestock production, with little or no integration with crops. They are mainly based on native grassland. In terms of total production, grazing systems are of lesser importance because they supply only 9 percent of global meat production. Of this, three-quarters comes from Central and South America and of the Organisation of Economic Cooperation and Development (OECD). Livestock interact in these systems with land, water and plant and animal biodiversity, especially wildlife. Agro-ecological conditions strongly define the nature and scope of livestock-environment interactions in grazing systems. The study therefore distinguishes between arid, semi-arid and sub humid, humid and temperate grazing systems. In principle, grazing systems are closed systems, where the waste product (manure) is used within the system and does not present a burden on the environment. Resource degradation, especially of land and biodiversity, is now developing in many of the world's grazing areas. For the most part this is occurring where, as a result of external pressures, traditionally well-managed common lands are becoming open access areas. In such open access situations, the interests of individual users conflict with those of the community, causing what economists call “market failures”. In these “free for all” situations, degradation is most severe. On the other hand, the grazing systems also offer potential for bio-diversity enhancement. Identifying institutions and incentives to correct the market failures and enhance the livestock-environment synergies is thus one of the biggest challenges in this system.

Mixed farming systems. In mixed farming systems, crops and livestock production are integrated on the same farm. Globally, mixed farming systems produce the largest share of total meat (54 percent), and milk (90 percent). Regionally, the mixed farming systems of the OECD countries and Asia provide by far the largest share of these products, but also in sub-Saharan Africa, West Asia and North Africa (WANA) and Central and South America, mixed farming is the main system for smallholder farmers. Resource use in mixed farming is often highly self-reliant as nutrients and energy flow from crops to livestock and back. By definition, such a closed system offers positive incentives to compensate for environmental effects (“internalize the environmental costs”), making them less damaging or more beneficial to natural resource base. Because of the completely different approaches needed to address the environmental effects of mixed farming, this study distinguishes between mixed farming in the developing and in the industrial world. The main challenge is to identify those policies and technologies which allow these systems to grow while sustaining their environmental equilibrium.

Industrial systems. These systems cover industrial types of production and small-scale urban or peri-urban production in developing countries. Both monogastric (pig and poultry) and ruminant production systems exist. They provide 37 percent of the total global meat production. These systems are open both in physical and economic terms. They depend on outside supplies of feed, energy and other inputs. These systems are strongly market driven, making them less resilient to market upheavals than other systems. Because of their many interfaces with the outside world, these systems, if not properly controlled, offer many opportunities to neglect (“externalize”) their environmental costs. The challenge is to identify the regulations and incentives which force the polluter to internalize the environmental costs, at a minimum cost to the consumer.

Global overlays. In addition to the site-specific and production system related impacts of livestock, such as land degradation in the arid zones, deforestation in the humid zones or livestock-wildlife interactions in the savannas, there are a number of effects which transcend the specificity of production systems. These are the global overlays, which include the environmental aspects of feed production, the emission of greenhouse gases, the erosion of wild and domestic genetic resources, and the management of waste. As in the industrial system, some of these impacts (for example, processing waste) can be traced to one polluter (called “point source pollution”), and can therefore be controlled with appropriate regulation at the source. The other impacts cannot easily be traced to one polluter (“non-source pollution”), and the challenge is then to find the incentives to encourage all producers to reduce these emissions.

Next section The changing importance of different production systems

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