Environmental Compliance Costs and the Competitiveness

This study measured the compliance cost of the current and possible future nutrient management regulations on pig production facilities in Ontario. Two farm types were examined: farrow to finish and finishing facilities. Three farm sizes were considered for each category:  a small farm with 900 pigs produced per year, a medium farm with 4,500 pigs produced per year and a large farm with 10,500 pigs produced per year. Each scenario was then tested with uniform manure application and optimal manure application that varied application rates by crop type based on plant nutrient needs. These scenarios were then examined under nutrient management regulations from the Nutrient Management Act (2002) and the Clean Water Act (2007).   The Nutrient Management Act includes two separate calculations for determining the maximum manure application rate. The crop nutrient requirement calculation bases the maximum manure application rate on the amount of phosphorus each crop requires and then allows for additional phosphorus application of 15.15lbs per acre. The second calculation to determine the maximum nutrient application rate involves the amount of phosphorus removed by the crop. This calculation allows for manure application to meet the amount of phosphorus the crop will remove at harvest plus 69.5lbs of phosphorus per acre. The Clean Water Act results assumed that regulations would restrict the nutrient application rate to 115% of the crop requirements of nitrogen and phosphorus. The medium and large production facilities were then subjected to sensitivity analysis of the soil phosphorus test as well as changes in the nutrient application rate allowable under the Clean Water Act. Lastly, the medium and large scenarios were also subjected to changes in the prices of inputs and outputs for crops and pigs to determine the sensitivity to prices.