N2O emissions are one of the largest sources of greenhouse gas (GHG) emissions in Canada’s agricultural sector and the federal government has set a national target to reduce GHG emissions from nitrogen fertilizers by 4 megatonnes by 2030 - the time to act is now. Agriculture and Agri-Food Canada’s February 2022 Discussion paper on the target recognizes that while current approaches are ‘moving the needle,’ new policies and programs will be needed to achieve this ambitious target.

As a contribution to resolving this issue, this present study focuses on optimizing nitrogen fertilizer management in two production systems - corn-soybean-winter wheat systems in Ontario and potato systems in Prince Edward Island - which both make substantial contributions to provincial agricultural output and employment, as well as GHG emissions.

The essential first step to solving the problem of GHG emissions from excess nitrogen fertilizer use is to identify the application practices that are scientifically proven to be effective, such as nutrient management planning and practices found in Fertilizer Canada’s 4R program. Efficient nitrogen fertilizer management also needs to be embedded into a broader understanding of natural on-farm sources of nitrogen and the overall health of agricultural soils. As such, this report also focuses on complementarities and synergies between nitrogen fertilizer management and soil health beneficial management practices (BMPs).

This report thus identifies and outlines novel policy options that can mitigate the barriers farmers face and support farmers in adopting efficient nitrogen management practices. Some of the primary barriers include:

  • Production risks or concerns about a trade-off between profit and risk

  • Upfront and recurring costs of practice adoption

  • Knowledge requirements of the practice

  • Perceived efficacy of the practice

  • Time constraints or inconvenience resulting from the change in management practices

Through regionally-grounded workshops, this study found that stakeholders in both provinces recognize the need for new policy tools and support testing new approaches to address these issues. The most promising solutions identified by the study include:

  • Behavioral economics approaches, particularly leveraging the use of trusted messengers and collective adoption bonus payments. Both policy tools help increase the perceived effectiveness of BMPs and help farmers learn about new practices more efficiently.

  • BMP insurance schemes that encourage farmers to trial new practices and protect them from production risks associated with practice change. This is due to the strong potential for de-risking existing BMPs and because a payout is only provided in the event of a loss.

  • A suite of business risk management programs, such as AgriInvest and AgriInsurance, to encourage the use of new BMPs. Modifications include offering increased matching under AgriInvest or offering lower insurance premiums through AgriInsurance, both contingent upon BMP adoption.

The next step for policymakers and researchers is to pilot these policies to gauge their effectiveness in motivating the use of efficient nitrogen management and soil health practices. 

By identifying the tools and policies with the highest degree of environmental and economic impact, Canada can advance its clean growth objectives and move one step closer to having a high-performing, efficient, and sustainable agriculture sector.

Read the Report