Agriculture Reference
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was the basis of the determination of the competitiveness of hemp
production in each land unit.
The 126 land units did not correspond to any political boundaries.
Counties had several different land units. Consequently, the prorated area
of each region was set as the ratio of cropland (UAA) to total land to
determine the competitiveness of hemp production.
Initial model estimates were run without hemp production as a
potential activity to assess how well the LPM solutions compared with
actual production. The estimated results showed a relative good fit with
actual production shares, especially in the northern and eastern regions of
Germany. The estimates for southern Germany were less accurate, perhaps
because of the small-scale structure of agriculture in the south and the
relatively large share of production by part-time or hobby farmers. In
general, the more homogenous a county's soil and weather conditions, the
better the fit between estimated and actual production.
The second series of models were estimated incorporating hemp
production as a potential activity. Six hemp yields were considered in the
analysis. As actual production data were not available, the yield estimates
were based on agronomic research data and production data (Christen and
Schulze 1997). A left skewed distribution with an average 8 tons per ha
yield of hemp straw was assumed. Yield values used in the estimated
models were 8 tons per ha with reductions of -25%, -12.5% -7.5%, and
increases of +5%, and +10% from the median of 8 tons.
A total of 756 model variants were calculated
3
. These calculations,
combined with the GIS results, allowed us to estimate the competitiveness
of hemp in each county, as well as the level of hemp cultivation. Hemp
production was considered for both non set-a-side land (regular land) and
set-a-side land. Hemp production never occurred on set-a-side plots in the
optimal solution because of lower hemp subsidies for these plots.
LPMs were also calculated for all 126 land units to determine the
minimum hemp price required for hemp to enter farm models as a
production activity on unrestricted farmland and on set-aside land. A total
of 6048 LPMs were estimated, one for each of the 6 yield levels with 8
price levels varying between 13 DM/100 kg to 5 DM/100 kg for each of
the 126 regions (126 regions * 6 yield levels * 8 prices). The results of
these model runs can be displayed on maps to visualize the variation in
geographic dispersion and quantity of hemp produced under each yield and
price assumption. To illustrate, Figure 9.2 shows the density of hemp
production in relationship to total cropland at a price of 6 DM/100 kg and
Figure 9.3 shows the density at a price of 12 DM/100 kg. Because the share
of cropland varies across counties—in some regions in East Germany the
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