Economic and Environmental Sustainability of Smallholder Agriculture: The Case of Maize Monocropping in North Thailand

Abstract

The northern region of Thailand is known for upland maize monoculture due to the crop’s demand-price stability and resilience to the arid hot season. Due to the scarcity of economically viable alternatives, smallholder farmers manage crop residue by burning, causing hazardous air quality in the surroundings. My thesis aimed to determine if and how upland smallholder farmers could farm more sustainably without reducing their income. To do so, I estimated the net present value (NPV) and benefit to cost ratio (BCR) of farm income over 15 years for maize monoculture (Bm), maize-mungbean intercrop (Bbi), avocado mono (Am), greenhouse tomato (Tg), macadamia mono (Mm), and macadamia-coffee intercrop (Mci). The study was conducted in Pang Hin Fon, Kong Bot, and Huay Fa villages of Chiang Mai’s Mae Chaem district. I hypothesized that incorporating legumes with maize (Bbi), replacing maize with vegetables (Tg), and replacing with perennials (Am and Mm) would increase NPV by 20%, 30%, and 70% respectively, and that multi-crop agroforestry (Mci) would add another 30% on top of the perennial monoculture (Mm). I found the NPVs of Bm, Bbi, Am, Tg, Mm, and Mci to be $13,806 (BCR 1.8), $21,136 (BCR 1.9), $103,430 (BCR 9.6), $483,025 (BCR 4.9), $55,913 (BCR 4.9), and $75,557 (BCR 6.2) respectively. This was much higher than expected: a minimum increase of 53% (Bbi vs Bm) and more than 3,000-fold increase in NPV under Tg (vs expected 30% for vegetables). Mci had a 35% higher NPV than Mm, slightly more than the expected 30%. Meanwhile, the payback periods for Am, Tg, Mm, and Mci were four, one, seven, and three years respectively. My second goal was to determine variables affecting farm income the most. The results met expectations—market prices affected income the most for Bm, Bbi, Tg, and Am, followed by yield for Mm and food loss for Mci. I also evaluated the NPVs under optimistic and pessimistic scenarios by jointly varying the yield and price. Tg was the most volatile, with a net loss of $85,247 (-118%) in the worst scenario (78% less yield; 74% less selling price). The risk of disease (wilt) outbreak caused a higher variance in the NPV of Am; however, it remained healthy even in the worst scenario. Finally, I compared the climate change and human health impacts of Bm and Bbi production using a life cycle assessment (LCA) approach. The LCA included the footprints of equipment, agricultural inputs, and open burning of residue. Bm had a climate change impact of 2.62 tonne (T) CO2eq and human health impact of 36.9910-3 DALY. Eliminating open burning reduced the climate change impact of Bbi by 29% (1.87 T CO2eq) and the human health impact by 71% (10.6510-3 DALY) compared to Bm. Human health was most impacted by open burning and climate change by fertilizers. Since legumes improve soil health, agricultural inputs could be optimized to further reduce the environmental impact. I found that multi-cropping systems integrating perennial trees, understory crops, vegetables, and legumes improved farm income, resilience, and external impact. The farmers I met were aware of and open to alternatives, but held back due to insufficient water and road infrastructure, weak supply chains, demand uncertainty, and lack of institutional support. To overcome these barriers, I recommend improving the upland water and road infrastructure, incentivizing novel supply chains and farm-to-fork solutions, institutional support for credit and training, and research into nature-based solutions for water conservation, crop protection, and yield increase of alternate crops.