Dutch farmers have taken to street protests as government policy indicates a likely 30% cut in milk production. Sjoerd Hofstee reports.
The milk price for farmers in the Netherlands has reached an all-time record high at more than €60 (NZ$101) per 100kg. That’s the only bright spot for Dutch farmers as new policy from the national government means 30% less milk may be produced by 2030.
Worldwide, there is debate about measures dairy farming should take to reduce carbon dioxide and methane emissions.
In the Netherlands, however, there is another problem – harmful nitrogen compounds.
In the 1990s, the European Union asked all its member states to designate vulnerable natural areas. The Netherlands complied neatly.
The big difference with most other European countries is that it is small in area, many people live there and it is even more crowded by livestock.
It has been recognised for some time that nitrogen compounds cause damage to nature reserves. On the one hand there are exhaust gases from industry and traffic and on the other ammonia from livestock farming, especially dairy farming.
Three years ago, the highest Dutch court rejected the Dutch policy of protecting nature areas.
Since then, the government and the agricultural sector have been engaged in a fierce battle.
This battle reached a new dramatic turn in June when the Dutch government announced an additional tightening of the policy.
Ammonia emissions must be reduced by 50% by 2030. This will mean dairy production will decrease by about 30%.
Farmers openly question various models and calculations behind the legislation, with demonstrations outside government buildings. But it doesn’t seem to help them much.
In the coming months it will become clear whether 2030 may be postponed to 2035 and whether technical innovations, such as innovative barn systems, will reduce some of the pain. But a substantial reduction of the Dutch dairy herd and milk production seems unavoidable.
As if that were not enough, the Netherlands will lose its exemption to the EU manure-policy as of 2026. Like parts of Germany, Denmark and Ireland, the Netherlands has enjoyed a position for years whereby instead of 170kg of nitrogen from animal manure, 250kg may be applied per hectare. In practice, that means 2.5 cows per hectare instead of a maximum of 1.7.
ZuivelNL, the dairy industry trade association, calculated this measure will cost an average dairy farm more than €25,000 a year. These costs are in extra manure disposal and purchase of extra fertiliser. More fertiliser will be purchased to maintain grass production.
It is logical that the trade association for dairy companies should sound the alarm, because the drastic reduction also affects them.
Dairy company FrieslandCampina has in the past collected more than 10 billion kg of milk annually, but it is already struggling to stay at 9 billion kg. They will close more factories in the coming years and still have to compete on the world market with players such as Fonterra with a smaller milk pool.
But the milk price is higher than ever, isn’t it? Milk prices are high throughout Europe, but the Netherlands is at the top so most dairy farms are making good profits. Last year, the average profit was calculated at €32,000. It is estimated that this year it will double. While dairy farmers might be expected to try to produce more milk to capitalise on the price, a phosphate quota focus sets limits.
For each additional cow that is milked, expensive rights of about €8000 per cow must also be bought.
At least as important, to dairy farmers all over Europe, are the extremely high costs for feed. With the war in Ukraine, much less grain and corn is available on the world market from Ukraine and Russia and prices are high.
The second reason is the drought in recent months has seriously affected the grain harvests across Europe.
In addition, costs for energy, fuel and fertilisers have increased enormously, especially as a result of the war in Ukraine.
More than a year ago, Dutch farmers paid about €20/100kg for basic fertiliser. At the beginning of this year, the price rose to above €100/100kg. This has now fallen to about €70/100kg.
Due to the drought, many dairy farmers across Europe have been unable to build up stocks of feed for the winter that will soon start.
It symbolises the hectic times for Dutch dairy farmers. The high milk price makes up for a lot, but the concerns about the near future are greater than ever.
- Sjoerd Hofstee is a dairy journalist at Persbureau Langs de melkweg, Netherlands.
