Environmental and technical efficiency of French sheep farms in less favored areas: off-season production penalizes environmental performance

Abstract Given the need for farms to reduce their negative environmental impacts while maintaining their productive performance, this study analyzes the technical and environmental efficiency of a sample of sheep farms in France, with a focus on greenhouse gas emissions and nitrogen surplus. To do so, we use a multi-equation stochastic frontier approach that accounts for the physical processes that generate environmental pollution. The results indicate that, on average, the potential technical and environmental efficiency gains for the farms in our sample would be approximately 20% if they could align their practices with best practices observed. The results also show that farms with low environmental efficiency have a high proportion of out-of-season production to meet the sheep industry’s demand, which increases their use of concentrates, nitrogen on forage areas, and energy, thereby worsening their environmental performance. Likewise, econometric estimates show that while off-season production could enhance farms’ productive efficiency, it is detrimental to their environmental efficiency. A set of production practices was identified as suitable for alleviating this issue by improving both the technical and environmental efficiency of the sheep farms in our sample.