Analyzing diversification possibilities on specialized tobacco farms in Argentina using a bio-economic farm model

Tobacco (Nicotiana tabacum L.) is the non-food crop with the largest acreage in the world. Tobacco is criticized because it causes health problems to its consumers and because production causes environmental damage such as soil degradation, deforestation and water pollution. Diversification has been indicated as the strategy for a sustainable economic development for farmers. In the specific case of Valle de Lerma, many years of continuous tobacco mono-cropping, excessive ploughing and poor irrigation control have caused soil degradation of the land used for tobacco. Tobacco farming in Salta also entails a production and a price risk which is increasing because of uncertainty surrounding governmental subsidies. The objective of this article is to assess the impact of diversification on expected farm income, income risk and soil organic matter (as an indicator of soil degradation) on specialized tobacco farms.