VII. Capture of Environmental Externalities

The utilization and disposal of animal manure and dead animals has become a concern, as discussed in Chapter 3, as the structure of the industry has shifted toward fewer but larger operations, and the percentage of animals raised in confinement has increased. Traditionally, farmers applied the manure to agricultural land to promote plant growth thereby recycling much of the nutrients. With fewer but larger operations, relying on inputs trucked in from the outside, the manure has become more concentrated in localized areas. When application rates exceed the carrying capacity of the land to assimilate nutrients, repeated applications can lead to a buildup of nutrients in the soil. This in turn, increases the potential for nutrients to move from the field through leaching and runoff and to pollute ground water (Kellogg et al, 2000).

In Thailand there are two types of disposal of nutrients coming out of livestock operations that are of concern. These are the manure generated from each animal and dead animals generated from mortality occurring during the lifespan of the animals. It is estimated that broilers and dairy produce 80 lbs (36 kg) of manure per day per animal unit, layers produced 60.5 lbs (27 kg) per day per animal unit, and swine produce 63.1 lbs (29 kg) per day per animal unit. As Thailand in 2002 had approximately 978 million broilers, 41-42 million layers, 392,300 dairy, and 16 million swine. This would equate to approximately 142 million kg of broiler manure, 4 million kg of layer manure, 14 million kg of dairy manure, and 93 million kg of swine manure per day that Thailand has to manage so that it doesn't harm the environment.

In this chapter the manure and dead animal disposal and use is described and detailed more fully in chapter 6. Then two measures are used to look at differences across size of farms in their ability to capture the environmental externality. One measure looks at the ability of different size farms to assimilate the entire nutrients produced on farm in terms of the estimated mass balance of nutrients produced from the manure.

The second looks at expenditure differences across different size of farms to mitigated negative environmental effects from manure and dead animal disposal. These measures are used to test hypothesis 3: Small-farmers expend a higher amount of effort/investment in abatement of negative environmental externalities per unit of output than do large farmers, and to understand why this may be the case.

7.1 Current Pathways of Nutrient Use (from manure and dead animals)

Disposal practices for manure and dead animals directly impact on nutrient balances, and also vary across scales of operation. Traditionally, by-products of livestock production in Thailand have been disposed of by: 1) applying it to land to improve the physical properties of the soil for plants, 2) using it as an animal feed (other animals, fish feed), 3) using it to create energy (directly burning for heat or creation of methane gas), 4) dumped into rivers, 5) burial, and 6) incineration. Figure 7.1 to 7.3 depict the various pathways for nutrient management and use in poultry, swine, and dairy operations currently in use in Thailand. Poultry operations tend to use the manure for either crops or fish feed and dead animals tend to be buried, incinerated, consumed or used as fish feed. Poultry manure after it is cleaned out tends to be dried, put in bags, and sold to middlemen to be used on crops or fish feed. If it is not sold it remains on the livestock farm and used for the same purposes. Given that swine manure is both solid and liquid, typically it will go into either directly into a holding pond or used in a biogas system. After leaving the biogas system or the holding pond the manure would be dried and put in bags until it is used. The utilization of swine manure differs by whether it is in a wet or dry form. Wet manure may be used to create household and farm energy such as biogas for cooking and power for farm use. Dry manure is either applied to fields as a fertilizer or used as a feed in fish farming and may be used either on farm or off farm. Two types of waste are created by dairy farm: manure and wastewater. Dairy manure is treated in one of three ways: It may be left on the grass where it falls, given to employees or dried. If dried it may be sold to a gardener or put on the farmers own grass. Dead animal for all types of livestock may be sold to a secondary market for either human or feed consumption, given away, buried or incinerated.

7.2 Manure and Dead Animals Disposal for Households Surveyed

7.2.1 Swine

Swine manure. Most of all size producers choose to get rid of the manure they produced through an off-farm method (see Table 7.1). Two percent of the large producers surveyed directly discharge the manure into public cannels while 25 percent of the small-scale producers surveyed directly discharged the manure into the public canals. Sixty percent of the small-scale producers directly discharged the wastewater into the public waterways while only 7 percent of the large-scale producers discharged the water into public waterways.

Most of the farms get rid of the pig manure by selling them (both in dry and wet manure) or giving them to their workers and neighbor. Over 90 percent of the large-scale producers interviewed sold all their manure off farm, while only 50 percent of the small-scale producers interviewed sold it of-farm. Only five percent of the small-scale producers used the manure for their biogas digester and twelve percent of the large-scale producers did the same. A small percentage of all size groups used the manure as fish feed.

Only 53 farms report that they invest in water treatment ponds and another 20 farms invest in biogas digester ponds. The average investment is Baht 817,600 for water treatment ponds and Baht 112,000 for the biogas digester. All of those farms have received government subsidies for their investment. The subsidies are 67 percent of the investment in water treatment ponds and 37 percent of investment in the bio-gas ponds. The Department of Livestock is the major government agency providing the subsidy for water treatment, while there are three government agencies providing the subsidy for bio-gas investment, namely the Department of Agricultural Extension, the Department of Agriculture and the National Energy Policy Office (see Table 7.2).

Dead piglets. In Thailand much of the dead piglets are removed off farm (see Table 7.3). Over 50 percent of farmers in all size groups report selling some of their dead animals. The number of dead animals sold increases as the size of operation gets larger. Thirty percent of the small producers sell a hundred percent of all dead animals and sixty-nine percent of the large producers sell a hundred percent of the dead swine.

Mass balance calculations for swine farms. Figures 7.4 and 7.5 illustrate the percentage of farmers, by size category, within a given range of nutrient balance. These ranges are indicative a farmers to assimilate the nutrients on to their existing land. The mass balance calculations performed here are used as rough estimates of actual nutrient balances. They serve to indicate households with potential problem areas, as well as where further research and technology transfer may be the more productive for certain size households. They also to serve to indicate why some households have active involvement with manure markets. If one is applying the manure by its nitrogen content approximately thirty percent of the small-scale operations had enough land to potential to absorb all the nitrogen in the manure produced on farm. The majority of small-scale producers (51 percent) had to find ways to dispose of a minimal amount of excess manure - 0 to 10 metric tons of manure of their property. In contrast all the rest of the size groups had to find ways to dispose of a substantial amount of swine manure. Both the medium to high and large-scale producers had to find ways to get rid of greater than 50 metric tons of swine manure. Similar results are seen in terms of phosphorous.

7.2.2 Broilers

Broiler manure. In the households surveyed over 50 percent of the broiler manure was sold off-farm. The exception to this was the smallholders where the use on farm and off farm was about evenly divided (see Table 7.4). Most of the manure was sold directly to other farmers, but a small percentage was sold to wholesale traders (small-scale 5 percent, medium-scale 17 percent, and large-scale 19 percent). More details of this is found in Chapter 6.

Dead bird disposal. Table 7.5 shows the break down by size producer of how they disposed of the dead animals. About half of all size producers interviewed report disposing of the dead animals on farm. The most common practice was incineration followed by feeding to other animals.

Mass balance calculations for broiler farms. Figures 7.6 and 7.7 illustrate the difference by size of producers in assimilating the nitrogen nutrients from broiler operations on the available land. If one is applying the manure by its nitrogen content a small percentage of all producers had enough land to potential to absorb all the nitrogen in the manure produced on farm. The majority of small and both size medium producers could get rid of most of the manure that they produced on their own farm, but had to find markets for up to 10 metric tons of manure. There were some large households that had a considerable amount of manure to get rid of. Eleven percent of the large farms had over 50 metric tons that they had to find a use for off farm. Similar results are seen for phosphorous.

7.2.3 Layers

Layer manure management. In the layer households surveyed most of the manure was used as a fertilizer or as a fish feed (see Table 7.6). Small-scale producers tended to keep over 50 percent of the manure for their own use on farms, while medium and large-scale producers tented to sell it. The main use of the layer manure for small-scale producers was as a fish feed (42 percent), followed as a fertilizer (20 percent), and a gift to relatives (10 percent). The main use of the manure for medium size producers if they did not sell it was also for fish farms (28 percent). In comparison only a small percentage (4 percent) of the manure in large-scale operations was used as a fish food on farm, but 50 percent reported it going to a non-defined source.

Dead layer management. Table 7.7 summarizes how the layer farmers surveyed manage their manure. From 73 responses, 45 percent say that they will burn or demolish these carcasses with their equipment. Only 16 percent say that they will bury or discard them. However, as high as 38 percent say that they will sell them in cheap prices. This figure of 38 percent may be the under-responded, since this question makes many of the farms hesitate to answer and some farms may commit lies. A higher percentage of the larger farms (58 percent) report selling the birds at cheaper prices than reported by small farmers (25 percent).

Mass balance calculations for layer farms. Figures 7.8 and 7.9 illustrate the percentage of farmers, by size category, within a given range of nutrient balance for layer operations on the available land. If one is applying the manure by its nitrogen content a small percentage of small-scale producers (2 percent) had enough land to potential to absorb all the nitrogen in the manure produced on farm. The majority of small and medium producers could get rid of most of the manure that they produced on their own farm, but had to find markets for up to 10 metric tons of manure. This is in contrast to the large households where over 50 percent had to find markets for over 50 metric tons of manure.

7.2.4 Dairy Farms

Dairy manure management. There are two main types of waste - manure and wastewater created by dairy farms. Most of the farms in the survey did not have any water treatment facilities, though 23 did have some kind of holding ponds. The remaining 60 farms discharged the wastewater into the grass fields. It is assumed that the discharge into the grass fields is minimal because the wastewater can act as a fertilizer for the grass-field. Only 9 of the farms reported discharging the wastewater into the public canal but out of these 9 4 were large farms and the remaining were small farms (see Table 7.8). For the manure over 52 percent of the farms sell the manure as an extra source of income. It appears that larger farmers sell less of their manure than other size farms as they may have larger or more grass fields to discharge them.

Mass balance calculations for dairy farms. Figures 7.10 and 7.11 illustrate the difference by size of producers in assimilating the nitrogen nutrients from dairy operations on the available land. Figure 7.10 shows the percentages of household surveyed that were in the specific categories. If one is applying the manure by its nitrogen content most producers has enough land to properly dispose of dairy manure. Forty-eight percent of the large-scale producers surveyed had more than enough land to dispose of dairy manure in terms of nitrogen, though the percentage dropped some when dealing with phosphorous for which land often gets saturated at a lower amount than nitrogen.

Environmental cost born by the livestock farm. Table 7.9 shows the average cost of pollution abatement for the various commodities. In the households surveyed small scale swine producers spent on average a higher amount on pollution abatement. Small-scale swine producers spent on average 1.2 baht per kg of pig meat compared to 1.02 baht per kg of pig meat by medium to low size producers, 0.76 baht per kg of pig meat by medium to high size producers and 0.46 baht per kg of pig meat for large-scale producers. Large-scale broiler producers spent on average a higher amount on pollution abatement. Small-scale broiler producers spent on average 0.008 baht per kg of chicken meat compared to 0.005 baht per kg of broiler meat by medium to low size producers, and 0.001 baht per kg of pig meat by medium to high size producers. Large-scale broiler producers spent a higher amount (0.02 baht/kg of chicken meat) on pollution abatement than all size producers, which may be due to choice of technology. Small-scale layer producers spent on average 0.6 baht per kg of eggs compared to 0.5 baht per kg of eggs by medium to low size producers, and 0.3 baht per kg of eggs large size producers. Small-scale dairy producers spent on average less than medium to low and large scale producers on pollution abatement. Small-scale producers spent on average 0.017 baht per kg of milk compared to 0.56 baht per kg of milk by medium to low size producers, and 0.1.4 baht per kg of milk by large size producers.

Table 7.1 Swine Manure Management for the Households Surveyed

* Multiple responses of farms so percents exceed 100%
Source: TDRI Survey, December 2002

Table 7.2 Subsidy for Water Treatment

Source: TDRI survey, December 2002.

Table 7.3 Dead Swine Management in Households Surveyed

* Multiple responses of farms so percents exceed 100%
Source: TDRI Survey, December 2002

Table 7.4 Broiler Manure Management by Size of Operation

* Multiple responses of farms so percents exceed 100%
Source: TDRI Survey, December 2002

Table 7.5 Dead Bird Disposal by Size of Operation

* Multiple responses of farms so percents exceed 100%
Source: TDRI Survey, December 2002

Table 7.6 Layer Manure Management by Size of Operation

* Multiple responses of farms so percents exceed 100%
Source: TDRI Survey, December 2002

Table 7.7 Dead Bird Management by Size of Household

* Multiple responses of farms so percents exceed 100%
Source: TDRI Survey, December 2002

Table 7.8 Dairy Manure Management Strategies

* Multiple responses of farms so percents exceed 100%
Source: TDRI Survey, December 2002

Table 7.9 Average cost of pollution abatement for livestock producers

Note: *one egg is approximately 100 grams.
Source: TDRI, Livestock Farm Survey 2002

Figure 7.1 Pathway of Poultry Manure and Dead Birds Disposal or Use in Thailand

Figure 7.2 Pathway of Swine Manure and Dead Piglets Disposal or Use in Thailand

Figure 7.3 Pathway of Dairy Manure and Dead Animals Disposal or Use in Thailand

Figure 7.4 Nitrogen Mass Balance Calculations for Swine Households Surveyed in Thailand, 2002

Figure 7.5 Phosphorous Mass Balance Calculations for Swine Households Surveyed in Thailand, 2002

Figure 7.6 Nitrogen Mass Balance Calculations for Broiler Households Surveyed in Thailand, 2002

Figure 7.7 Phosphorous Mass Balance Calculations for Broiler Households Surveyed in Thailand, 2002

Figure 7.8 Nitrogen Mass Balance Calculations for Layer Households Surveyed in Thailand, 2002

Figure 7.9 Phosphorous Mass Balance Calculations for Layer Households Surveyed in Thailand, 2002

Figure 7.10 Nitrogen Mass Balance Calculations for Dairy Households Surveyed in Thailand, 2002

Figure 7.11 Phosphorous Mass Balance Calculations for Dairy Households Surveyed in Thailand, 2002