Dairy farm lags behind arable farm

The number of arable and dairy farms in the Netherlands is declining, but the average size of the farm is increasing. Average incomes, on the other hand, have fallen sharply. This is apparent from the memorandum 'Economic development of arable and dairy farms' by Wageningen Economic Research.

The average surface area of ​​arable farms increased from 2006 hectares to 2015 hectares in the period between 60 and 64. The average surface area of ​​dairy farms in the Netherlands has increased from 45 hectares to 53 hectares in the same period. 

Arable farmers earn less than in 2015
The average income from an arable farm for 2016 is estimated at €58.000. That is 14% less than in 2015. However, this corresponds to the average income of the above period (2006-2015). According to the report's estimate, 20% of arable farmers will experience a loss of income, while another 20% will realize an income of more than €98.000.

The total yield for the current marketing year is estimated to be slightly lower. This is due to the lower selling prices for sugar beet, for example. However, the above does not apply to the potato market, because it has to do with a high demand for ware potatoes.

The balance sheet value of arable farms has doubled since 2006. In 2006 that number amounted to €1,95 million and in 2015 that number increased to €3,89 million. This is mainly due to the sharp rise in the price of land and the growth in the size of the companies. Per hectare of cultivated land, the balance sheet value of arable farms has increased from €33.000 to €60.000. 

Dairy farming under pressure
In dairy farming, the story is even more disappointing. The average income for 2016 there is estimated at €16.000. That is almost €7.000 lower than in 2015. The average income in the period from 2006 to 2015 was even €32.500. Only in 2009 was an even lower income realized. 

Due to the abolition of the milk quota, the milk supply has increased considerably. As a result, the milk price in 2016 fell by an average of 9%. At that time, there was also an increase in the average number of dairy cows and the milk production per cow. 

The balance sheet value in dairy farming has risen less rapidly than that of arable farms. In 2006 this was €2,45 ​​million and in 2015 €3,07 million. The balance sheet value per hectare of cultivated land is €58.000, an increase of 7% compared to 2006.

Higher yields in arable farming
In the period between 2011 and 2015, arable farms achieved a much higher return than dairy farms. An average arable farm achieved a return of 3,7% and a dairy farm a return of 1,7%. 

In addition, it is striking that the share of the bank loan in dairy farming has increased considerably, from €12.000 to €17.000. This loan has only a limited share among arable farms.

Kimberly Baker

Kimberly Bakker is an all-round editor at Boerenbusiness. She also has an eye for the social media channels of Boerenbusiness.

k.baker @boerenbusiness. Nl

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