Organic Agriculture Nightmare Tanks Sri Lanka’s Economy

Again and again, new solutions for the environment and human society fail if not properly planned and executed. Whether it’s widescale use of renewables, closing nuclear plants with no plan to replace the generation, or big infrastructure builds just to make jobs, if the rush to emplace is more important than their success, then they will fail.

The latest example of this is organic farming. Ted Nordhaus, Executive Director of the Breakthrough Institute, and Saloni Shah, Food and Agriculture Analyst, provided a dismal picture for organic farming on a large scale, especially when done without care. Their work appeared on March 5th in Foreign Policy and I take liberally from that study with permission from the authors. But I encourage you to read the entire article in FP as soon as you can.

Sri Lankan President Gotabaya Rajapaksa promised in his 2019 election campaign to transition the country’s farmers to organic agriculture over a 10-year period. Last April, Rajapaksa’s government jumped ahead of themselves, and imposed a national ban on the import and use of synthetic fertilizers and pesticides, and ordered the country’s 2 million farmers to go organic – eight years ahead of schedule.

As described by Nordhaus, the result was brutal and swift. Contrary to claims that organic methods can produce similar yields as conventional farming, domestic rice production fell 20% in just the first six months. Sri Lanka, which had been self-sufficient in rice production for a long time, now has to import $450 million worth of rice.

The ban also devastated the nation’s tea crop, its primary export and main source of foreign exchange. Just yesterday, the Central Bank of Sri Lanka devalued its currency as its foreign reserves dwindled, potentially accelerating the worst inflation surge in Asia as the nation struggles to service its debt and pay for imports.

Which is ironic. Sri Lanka is the world’s 2nd largest exporter of tea, and its most widely known export, Ceylon tea, is considered by the International Organization for Standardization (ISO) to be the cleanest tea in the world in terms of pesticide residues.

Faced with a deepening economic and humanitarian crisis, Nordhaus discusses how Sri Lanka cancelled most of their their poorly-planned national experiment in organic agriculture, partially lifting the fertilizer ban on key export crops such as tea, rubber, and coconut. The government is giving $200 million in compensation to farmers and $149 million in price subsidies to rice farmers.

Which hardly makes up for the damage and suffering the organic order produced. There will be economic losses of over $400 million just from the drop in tea production.

But the hardship to the citizens of Sri Lanka has been even worse. By 2019, the country had achieved upper-middle-income status (see GDP figure below). But now, half a million Sri Lankans have fallen back into poverty. As described in the Foreign Policy article, The country’s economists have called on the government to default on its debt repayments in order to buy essential supplies for its people.

Rajapaksa might be forgiven if the orders had arisen from a firm belief in organic farming practices and concern for the environment, but Rajapaksa seemed to just want some notoriety as a president overseeing an “agricultural revolution”. Rajapaksa also wanted excuses to slash fertilizer subsidies and imports as well as finding a nice-sounding banner for his election campaign.

Of course, when he fired those honest ministers who acknowledged the failure, the jig was up.

This horrible turn in Sri Lanka’s fortune began in 2016, with Rajapaksa’s formation of a movement called Viyathmaga. Promising everything from national security to anticorruption to education policy to fully organic agriculture, Viyathmaga was the perfect election platform.

Unfortunately, most of Sri Lanka’s leading agricultural experts and scientists were kept out of the planning, which included promises to phase out synthetic fertilizer, get the people to come up with 2 million organic home gardens, and get the country’s forests and wetlands to produce the necessary amount of biofertilizer.

To add insult to injury, right after Rajapaksa’s election, the COVID-19 global pandemic arrived, devastating Sri Lanka’s critical tourist sector. By 2021, Sri Lanka’s budget and currency were in crisis. Sri Lanka was unable to pay its debts to Chinese creditors who had financed a huge infrastructure blitz as part of China’s One Belt One Road project.

Nordhaus digs deeper into the history surrounding this issue. Since the Green Revolution of the 1960s, Sri Lanka, like much of Asia, subsidized farmers to use synthetic fertilizer. The results were amazing as crop yields doubled. Sri Lanka became food secure while exports of tea and rubber became the basis of a stable economy. Sri Lanka achieved official upper-middle-income status in 2020 according to the World Bank.

By 2020, $500 million a year was going to fertilizer and subsidies. Rajapaksa’s organic push seemed to him a win-win, ending the subsidy and giving him an additional $500 million a year to use elsewhere.

But wishful thinking is no substitute for expertise. But agronomists around the world warned that agricultural yields would drop precipitously.

The loss of revenue from tea and other export crops was so much more than expected, the importation rice and other food stocks soared, and the cost of compensating farmers and providing public subsidies for imported food was so high that the economy simply could not handle it.

Nordhaus shows us that farming is a simple energy in, energy out process. For most of human history when global populations were less than a billion, the primary way humans increased agricultural production was by adding land to the system.

Contrary to popular ecomythology that preindustrial agriculture existed in greater harmony with nature, three-quarters of deforestation in the world occurred before the industrial revolution. Even in the early 19th century, over 90% of humans worked in agriculture. There was no Middle Class.

Things changed dramatically with the invention of the Haber-Bosch process in the early 1900s, which uses high temperature, high pressure, and a chemical catalyst to pull nitrogen from the air and produce ammonia, the basis for synthetic fertilizers. Synthetic fertilizer remade global agriculture and, with it, human society. Crop yields increased dramatically and allowed human labor to shift from agriculture to better jobs, higher incomes and a better quality of life.

Synthetic fertilizers have allowed global agriculture to feed nearly 8 billion people. As described by Nordhaus and Shah, these fertilizers, combined with other innovations such as modern plant breeding and large-scale irrigation projects, allowed global population to more than double, and allowed agricultural output to triple on only 30% more land.

Without synthetic fertilizers and other agricultural innovations, there would be no urbanization, no industrialization, no global working or middle class, and no secondary education for most people.

On the other hand, Nordhaus notes that all of organic agriculture production serves only two populations at opposite ends of the income spectrum. At the low end are the 700 million people who still live in abject poverty, practicing old fashioned subsistence farming, barely eking out a living, not able to afford fertilizer or any modern technology. This is now termed agroecology to make such poverty sound good and natural.

On the opposite side are the world’s richest people who can afford to choose organic food based on romanticized ideas about agriculture and the natural world. Who else would pay five bucks for a cup of coffee made with organic shade-grown coffee beans shipped up from the Amazon?

As a niche within the larger industrialized agricultural system, organic farming works nicely, especially since its small scale is easily supported by existing animal manure and organic components. But it has to stay small-scale.

Rajapaksa will not admit that his policies have failed, but his fertilizer ban has been partially lifted. Unfortunately, the fertilizer subsidies have not been restored.

As Nordhaus points out, there is no shortage of problems associated with chemical-intensive and large-scale agriculture in Sri Lanka or anywhere else. But there are solutions to these problems – innovations that allow farmers to deliver precise fertilizer doses at critical times in the growing season, bioengineered microbial soil treatments that fix nitrogen in the soil and reduce the need for both fertilizer and soil disruption, or genetically modified crops that require fewer pesticides and herbicides to begin with.

Note – GMOs are not not-organic. They are just a quicker way to cross-breed which we’ve been doing for ten thousand years.

These innovations will allow countries to minimize the environmental impacts of agriculture without impoverishing farmers or destroying the economy. Proponents of organic agriculture, by contrast, can offer no credible solutions.

What they offer, as Nordhuas says, and Sri Lanka’s farmers have found, is misery.