News Denmark
Danish agriculture in deep crisis due to drought
Danish agricultural entrepreneurs are in the worst crisis since 2009, when the financial crisis surcharge. This is partly due to the extreme drought in the country. The low prices of pork, in particular, are also affecting the sector.
According to the Danish agricultural research center Seges, the sector is in its worst position since 2009 when farmers were hit hard by the financial crisis. In addition to the lower crop yields due to the drought, pig farms in particular are struggling with red numbers. Pork prices are low, while feed prices are skyrocketing. There is a fear of a wave of bankruptcies, Top Agrar writes.
300
businesses
More companies in the red
According to figures from the institute, 1.500 of the 9.500 Danish farms were in the red at the start of this season. An estimated 300 companies have been added due to drought, which previously had a positive balance. The number of bankruptcies is expected to increase in the coming months.
Total agricultural income is estimated to fall by €1 billion this year. Last year a plus was made of €698 million. This is calculated by the Danish branch organization L&F for agriculture and food processing. The result hasn't been this bad in almost 10 years. The drought will cost companies more than €800 million in total.
Pig sector hard hit
Pig farmers in particular are having a hard time. Meat prices have been low for a long time and feed costs are rising rapidly. Seges estimates that an average pig farm will be €220.000 in the red this year, accounting for 5 times the average annual income. The biggest blows are therefore expected in this sector.
During the past 10 years, the Danish agricultural sector has had a hard time. The Russian import sanctions affected exports, termination of the milk quota had major consequences for the dairy sector and now there is the drought. The financial crisis in Europe caused a sharp fall in land prices and economic losses. Brexit is expected to cause further profit declines in the coming years.
Niels van der Boom
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