There are 70,000 agricultural businesses in my country, The Netherlands, including horticulture and dairy farms (20,000). However, that number has been declining for decades. In 1950 there were 400,000 agricultural businesses, mostly family farms. The number of agricultural business decreased from roughly 100,000 in 2000 to 70,000 at the end of this year, a decrease of almost 30%. At the same time, the sizes of agri-businesses grew while production values increased due to production growth and increased food prices. The decrease of businesses since 2000 means that 7 farmers per day are ending their businesses. Sometimes this is part of the ‘natural’ process of a farm or farmer’s life: a farmer retires and has no heirs or no family members who are interested in taking over the farm. But there are also reasons of economy: farmers are economically put out of business.
Stopping with farming is often a personal tragedy for farmers who had farmed for generations and there have been cases of suicide. The biggest problems are experienced in the greenhouses in the Western part of the country known as the Westland. This area is the most important greenhouse area in the world. Of every ten agricultural businesses in that area in 2000, currently only 4 remain. Owners of these businesses can hardly make a profit from their greenhouse products due to the fact that they need to compete with each other and with countries that can produce cheaper. Also, supermarkets drive hard bargains and while these make a big profit, the producers get a very low price for their produce often even under costs of producing. The Westland is a congested part of the country and owners of green houses find themselves with increased regulation, especially regarding pollution of surface waters which is a big problem in the Netherlands. Another factor is the increased prices of land which makes it difficult for them to expand their businesses. Therefore some owners have decided to stop altogether while others are moving their businesses to other parts of the country or even abroad (perhaps Serbia has green house potential??). Farmers put out of business are often left with huge debts.
So the number of agricultural business is decreasing while their sizes and values are increasing. At the same time, the European Commission has decided to provide agricultural subsidies (currently half of the EU’s budget) based on the number of hectares that a farmer has and not on the basis of production, as it used to be. This, in order to curb overproduction and to lessen the environmental burden caused by agriculture. To acquire new agricultural subsidies, farmers are required to make efforts to improve environmental conditions and animal welfare. One of these efforts is for instance that a part of the land is set aside to lay fallow to increase biodiversity in and around agricultural land. The change in the subsidy system is particularly bad news for small farmers, for owners of dairy farms and for owners of green houses. While subsidies allow small farms to exist, large farms tend to get the larger share of the subsidies. For many countries this is a concern since they have many small farms.
The disappearance of small farms is weighing heavy on employment in small villages and many people are forced to leave to look for employment opportunities elsewhere and this has consequences for the survival and cultural life of small villages. The disappearance of small farms is a trend that is expected to continue not only in my country but also in others, including Serbia. This leads to the danger of depopulating the country side. To stop and reverse this trend requires innovative solutions that focus not only on agriculture but also on other sectors of the economy. Examples of the former could be organic farming (an increasing market in Western-Europe, despite the crisis), bio-energy production and nature custodianship combined with agro/eco tourism. Example of the latter could be setting up new industries which serve not only the local market but also serve big cities not too far away or industries that shift focus from the national market to nearer foreign markets.
The area around Belgrade has seen the emergence of new industries which serve the wider Belgrade area. The challenge lies in creating opportunities for areas which are not so close to big cities. What is required from the government in order to facilitate diversification of rural economies is improvement of infrastructure, investment in setting up new rural industries and improvement of cross border corporation. This requires from all parties involved ‘out of the agricultural box’-thinking, which could be the biggest obstacle of all.
Some statistics about Dutch agriculture:
The agricultural sector (including horticulture) in The Netherlands is the 2nd largest exporter of agricultural produce in the world after the US and has taken the second ranking away from France. That is a major economic accomplishment considering the relatively small size of the country compared to the US and France. Agriculture occupies a surface of 2.3 million hectares in The Netherlands which amounts to 55% of total land area. Agriculture contributes for 10% to the country’s GDP and to 17.5% of the country’s exports. Exports of agricultural produce in 2011 were worth €72.8 billion and 80% of exports went to other EU countries (25% to Germany). The agricultural sector roughly contributes to 4-8% of the work force in The Netherlands. The most important agricultural crops are cereals (especially wheat), potatoes and animal fodder such as corn. In horticulture, vegetables and flower bulbs are the most important products. The greenhouses in The Netherlands also produce many vegetables and flowers, and the green houses represent almost half of total European capacity. The Netherlands is also an important exporter of cheese, butter, milk and milk powder. Animal husbandry maintains/processes 1.2 million pigs, 100,000 million chickens and 4 million cows. In 2011, 16 percent of businesses had 50 or more hectares while 3% had more than 100 hectares.