When you think of “capital,” you may think of wealth or assets that make obtaining goods and services possible. Natural capital, more specifically, can also be described that way, although the services provided by nature and its resources are oftentimes regarded as “free.” Referred to as ecosystem services, these benefits from nature range from the water and food we consume to various environmental processes that are harder to put a price tag on, like the regulation of floods and water flow as well as pollination and soil development.¹

A publication by the United Nations in 2005 helped to popularize the concept of ecosystem services, and they have since been acknowledged in policy and decision-making for the invaluable role they play in underpinning the well-being of humanity and the global economy.^1,2 Although the process is imperfect, specialists attempt to evaluate the monetary value of ecosystem services; one prominent study estimated their total worth to be 145 trillion USD per year.³ Considering the value they possess, it is unsurprising that certain technologies have been created to reproduce and enhance the services traditionally provided by nature.

This is especially true for food production, with technologies like pesticides, fertilizers, farming machinery, and irrigation systems used to boost productivity. While these technologies are effective in the short term, they reduce the long-term productive capacity of natural capital.^1,4 For example, the nitrogen and phosphorous used in fertilizers are considered environmental pollutants, and they are especially harmful to natural resources like surface waters and groundwater.^5,6 Because they are critical to plant growth, excess nitrogen and phosphorus can lead to an overabundance of algae growth in water bodies. The algae then deplete the oxygen from the water to the detriment of both the water quality itself and the aquatic species which depend upon it.⁷

Thus, fertilizers reduce the utility of our water resources, and they impact the ability of our soils to provide ecosystem services as well.^7,8 One such effect of their use is the reduction of the soil’s ability to regulate itself: fertilizers and other agrochemicals are disruptive to the communities of microorganisms that live in the soil. These microorganisms play an important role in the soil’s retention of nutrients.^9,10 Another common technology, irrigation, can increase the soil’s salt concentration, degrading its quality and making it more vulnerable to erosion.^11,12

Using various agricultural technologies to replace and enhance the services traditionally provided by nature has been environmentally costly. In the long term, reducing the effectiveness of natural capital’s provision of ecosystem services is harmful to the economy and poses certain risks going forward.¹ This is because the degradation or disruption of an ecosystem service would necessitate our intervention to develop a replacement or substitution for the natural function it performed. In fact, specialists use these concepts of replacement and substitution to estimate the cost and monetary value of ecosystem services.¹³ Even today, agricultural technologies designed as substitutes for natural processes, like the use of pesticides for pest maintenance, create additional expenses for food producers that can be difficult to afford, especially for small-scale producers.

Avoidance of these costs is a reason behind the increasing trend toward building the health and usefulness of natural capital within food production systems. In general, this can be done by using methods that enhance the health of soils, increase the availability of onsite water resources, and support the overall biodiversity of species present.¹¹ In this way, food producers can improve productivity through biological means, by considering the system primarily as an ecosystem capable of providing ecosystem services. Understanding the ways in which nature can provide for both itself and humanity can create opportunities for us to make better use of the “free” natural capital available to us.

References:

1. Millennium Ecosystem Assessment, 2005. Ecosystems and Human Well-being: Synthesis. Island Press, Washington, DC.
2. Martin-Ortega, J., Jorda-Capdevila, D., Glenk, K., & Holstead, K. L. (2015). What defines ecosystem services-based approaches? Water Ecosystem Services, 3–14.
3. Costanza, R., de Groot, R., Sutton, P., van der Ploeg, S., Anderson, S. J., Kubiszewski, I., Farber, S., & Turner, R. K. (2014). Changes in the global value of Ecosystem Services. Global Environmental Change, 26, 152–158.
4. The Economics of Ecosystems and Biodiversity (TEEB) (2018). Measuring what matters in agriculture and food systems: a synthesis of the results and recommendations of TEEB for Agriculture and Food’s Scientific and Economic Foundations report. Geneva: UN Environment.
5. McDowell, R., & Laurenson, S. (2014). Water: Water Quality and Challenges from Agriculture. Encyclopedia of Agriculture and Food Systems, 425–436.
6. Nagendran, R. (2011). Agricultural Waste and Pollution. Waste, 341–355.
7. Jones, J., & Downing, J. (2009). Agriculture. Encyclopedia of Inland Waters, 225–233.
8. Xiong, M., Sun, R., & Chen, L. (2018). Effects of soil conservation techniques on water erosion control: A global analysis. Science of The Total Environment, 645, 753–760.
9. Eisenhauer, N., & Schädler, M. (2010). Inconsistent impacts of decomposer diversity on the stability of aboveground and belowground ecosystem functions. Oecologia, 165(2), 403–415.
10. Thiele-Bruhn, S., Bloem, J., Vries, F. T. D., Kalbitz, K., & Wagg, C. (2012). Linking soil biodiversity and agricultural soil management. Current Opinion in Environmental Sustainability, 4(5), 523–528.
11. Mollison, B. C., & Slay, R. M. (2013). Introduction to permaculture. Tasmania, Australia: Tagari Publications.
12. Bindraban, P. S., Velde, M. V. D., Ye, L., Berg, M. V. D., Materechera, S., Kiba, D. I., … Lynden, G. V. (2012). Assessing the impact of soil degradation on food production. Current Opinion in Environmental Sustainability, 4(5), 478–488.
13. King, D. M., & Mazzotta, M. J. (n.d.). Damage Cost Avoided, Replacement Cost, and Substitute Cost Methods. Ecosystem Valuation. Retrieved May 2, 2023, from https://www.ecosystemvaluation.org/cost_avoided.htm#summa