News Nitrogen
Rabobank: 'Act differently with knowledge of today'
Rabobank looks back with mixed feelings on the years of scaling-up initiated by the government. "With today's knowledge you would really act differently in the past," the bank told newspaper Trouw. "At the bottom of the line, it's now about helping farmers with perspective and protecting nature. Rabobank is doing everything possible for a realistic and good solution and definitely wants to play a role in this."
This is not the first time that Rabobank has taken joint responsibility for scaling up the sector. "As a bank, we share responsibility for how the system is now," said Bas Rüter, Sustainability Director last year in an episode of Zembla.
However, political pressure on Rabobank as the largest financier of the agricultural sector is increasing. Last month, during the nitrogen debate, the House of Representatives issued a motion asking the government to investigate 'how banks, suppliers and customers with long-term contracts can be forced to bail-in that bears a substantial share of the transition costs'. Rabobank informed Nu.nl that canceling debts is not an option, because supervisors of the European Central Bank (ECB) are critical of this. Loans can only be forgiven if there are interest and principal arrears and if companies have no collateral (such as land or machinery). This is not often the case in agricultural companies.
Criticism of World Wildlife Fund on financing innovations
The World Wildlife Fund (WWF) - a partner of Rabobank - sent a letter to the bank and FrieslandCampina this week. In it, the WWF argues that 'innovations' and new investments in 'nd of pipe' solutions, such as devices that claim to reduce ammonia emissions, will not help solve all the other challenges that are now equally urgent and necessary. "Investments in these kinds of solutions will turn into a stranded asset or worse, will cost agricultural entrepreneurs high costs while only offering them a false sense of security in the short term."
The WWF refers to the Rabobank pilot with the Lely Sphere. The pilot means that Lely, FrieslandCampina and Rabobank will jointly support the installation of 96 Spheres financially. Lely does this through a discount, Rabobank gives an interest discount on the financing and FrieslandCampina makes €960.000 available. The price of the Lely Sphere is around €150.000. According to Lely, the Lely Sphere can (proven) reduce the ammonia emissions of a dairy farm by 70%. Minister of Agriculture Henk Staghouwer was critical of this to the press at the opening of the Lely Campus: "The 70% nitrogen reduction claimed by Lely must first be really proven and later prove to be legally tenable. In the past we have stable systems since this is not always the case."
FrieslandCampina advocates innovative solutions
In a letter to member dairy farmers this month, FrieslandCampina stated that it considers the government's approach to reducing nitrogen to be 'unrealistic, undesirable and very disappointing'. "What we first need is investment from the government in farmers who want to make their business operations more sustainable. FrieslandCampina is in favor of innovative solutions instead of just an attractive purchase scheme. We believe this is a more sustainable and future-proof solution for the Netherlands."
The dairy cooperative is currently not talking to nature clubs and other organizations. "Now is not the time to start new social initiatives or to make new or renewed agreements. That is why FrieslandCampina has stopped all discussions with stakeholders about this for the rest of the year. All our efforts are now focused on getting things moving. from the government."
The headline above the Trouw article from which it is quoted read: Rabobank expresses regret in the nitrogen crisis. In a statement, a spokesperson for the bank stated: "This is not what has been said, not the purport of our message to Trouw, and for the record: neither is the sentiment within the bank and its policymakers." From the questions from Trouw and answers that Rabobank sends, it appears that the quotes from the newspaper in the above article are written in such a way.
Linda van Eekeres
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