'Compulsory blending invites more sustainable farming'

A blending obligation in our food stimulates the demand for sustainably produced raw materials. This makes sustainability more attractive to farmers, because the price of these products is rising. In this way, the government can make an effective contribution to cleaner agriculture and a better revenue model without subsidies. Farmers can now quickly choose from three options: stop, become a rural entrepreneur or grow into industrial agriculture.

When asked about his vision of the future of Dutch agriculture and food production in 2040, Krijn Poppe smiles. "We economists don't like to make predictions, we prefer to see what happens and try to discover laws in it." Poppe has been doing this 'looking at agriculture' all his life. Growing up among the farmers in Flevoland, after his studies at the Erasmus University in Rotterdam, he started working at what was then called the Agricultural Economics Institute (LEI). When he retired there a few years ago, that name had been changed to Wageningen Economic Research and Poppe's backpack was more than filled with knowledge about agricultural economics. Since then he has been active as a member of the Council for the Living Environment and Infrastructure, as a board member of SKAL, the supervisor of organic production; he is also co-owner of a (conventional) arable farm in Zeeland.

Quality Labels
Poppe notes that there are all kinds of quality marks in the world of agriculture and food. "One quality mark is about nature-inclusive, the other about lower CO emissions₂ or another harmful substance, yet another quality mark focuses on animal welfare or local sales or a better reward for the farmer. We have created a forest of labels, where the consumer can no longer see the wood for the trees," Poppe outlines the situation. Each quality mark only covers a small part of the market, they are all so-called 'niches'. not so much wrong with it. The products are a bit more expensive, but also because they don't focus on the heavy subjects such as nitrogen or water level in the peat meadow, they do not contribute enough to the development towards sustainability."

Mix in
This is possible with a blending obligation based on the goals formulated by the government in the National Program for Rural Areas (NPLG). This program is the basis for the area-oriented approach, which is currently in the spotlight as part of the nitrogen discussion. "But the NLPG contains all the goals for water, nature and climate; they are completed per area and are provided with a timeline," Poppe explains. According to him, the government can give farmers who already meet the requirements for 2035 a "clean farmer" certificate. The blending obligation then applies to their products. "Processors and retailers have to comply, so the demand for these products is increasing and that ensures a better price for the farmers."

Such a blending obligation is not new. It already exists in the fuel sector, where since 2007 a certain percentage of biofuels must be added to petrol and diesel. "It has also been used in the agricultural sector before. In the fifties and sixties of the last century we had the mixing obligation for native wheat. Bakers were obliged to bake a minimum amount of Dutch wheat in their bread. The government supported this at the time. wheat cultivation in our own country," explains Poppe.

Benefits
A general 'clean farmer certificate' with a blending obligation has several advantages:

• Earnings model for the farmer: the demand for sustainable raw materials for food is increasing, which leads to a higher price
• Incentive for industry and retail: the blending obligation increases the cost price of food, so that more attention is paid to sales to high-quality markets and the income from this goes to sustainable farmers
• Less room for greenwashing: vague claims such as 'more natural', 'more sustainable' or 'authentic' are becoming less credible and the current quality labels also take into account heavy subjects such as nitrogen and water levels
• Efficient government policy: no additional costs are necessary for various subsidies after the first and largest steps have been taken with the 24 billion from the NPLG
• Clarity for the consumer: the basic quality will become more sustainable, regardless of whether or not it has a quality mark. Consumers who also want to support a specific theme - such as animal welfare or meadow birds - can still do so by purchasing products with the specific quality mark.

Motion
The idea of ​​the mandatory blending, which Poppe developed together with European colleagues, led to a motion passed in the House of Representatives last year asking the government to investigate the principle in more detail. "It is to be hoped that this will be taken up quickly, because once the mandatory blending is in place, we also have a good means of steering towards more sustainability, for example by increasing the percentage of mandatory blending as soon as there is room for it," Poppe hopes.

His proposal fits in with the philosophy of the EU, in which sustainability is 'enforced' through a combination of government policy and market forces. "Just look at the Union's CSR policy. A directive has now been established for this that stipulates that the 50.000 largest companies in the EU must report annually on which raw materials they purchase from where and how sustainable they are. That also applies to supermarkets and the food industry, who must demonstrate that they purchase responsibly, ranging from farmers to Uyghurs."

Select
Compulsory blending or not, farmers in the Netherlands are faced with an important choice: stop or produce cleaner. There are two flavors of 'cleaner', Poppe expects: more extensive or more industrial. In any case, he expects an acceleration in the decline in the number of farms. "There are many farmers without successors, environmental requirements are only getting stricter and there are more than enough jobs available outside agriculture," he sums up the factors that determine the structure development. "In fact, we have a small-farmer problem again. Just like in the XNUMXs and XNUMXs, only the small farmers of today are much larger than those of seventy years ago."

To illustrate this, Poppe makes the following calculation: the area of ​​agricultural land will decrease by approximately 2040 hectares until 200.000, partly due to additional housing. "We also have to take into account more immigration because of our overburdened labor market. I have the impression that many still underestimate this." The decrease in area in the same period is offset by a strong increase in the area required for a viable farm. "I assume 250 hectares as an average for an arable or dairy farm that will have sufficient opportunities to earn a living sustainably in 2040. That means that with 1,5 million hectares of agricultural land there is room for 5.000 land-based agricultural companies. Count intensive Animal husbandry and greenhouse horticulture at the end, then you will have about 2040 companies left in 10.000. Now there are only 50.000, so the decline will be much faster in the coming decades than it has been so far."

Poppe sees two possible development directions for the 'stayers':

1. Industrial: continue on the path of further scaling-up and intensification. "Then you have to buy expensive land and you have to show that you farm cleanly. That means a lot of extra investment in all kinds of innovative techniques to limit emissions. In short: not an easy way, but I think you have to tell the market within strict rules leave."
2. Becoming a rural entrepreneur: "You can make the agricultural branch of your business more extensive to meet the requirements for sustainability. The earning capacity can be maintained by reducing the costs of inputs and by adding other activities to your business, such as nature conservation, energy production, childcare, a care farm, local sales, etc. This way you can sometimes escape the race to those 250 hectares. You can already see this growing in practice and I think it can offer a perspective for more and more farming families."

Do not wait to long
When asked about the role that the various parties involved should play in this development, Krijn Poppe first gave the Dutch farmers some good advice: "Don't resist what is socially unavoidable and economically logical. Think carefully about what you can do and what you want. that now because the government now has the resources to support you whether you want to quit, grow or become a rural entrepreneur I suspect it will soon be over with generous financial compensation from the government With rising interest rates the deficits of the government will quickly increase and we will again enter a period of austerity."

And the others involved, what can they do according to Poppe?

a. Governments: Drawing up a vision on how to achieve the goals laid down in the Water Framework Directive, the Climate Act and the Habitats Directive. "Which agriculture fits within those frameworks and how do we get there?"
b.  Agribusiness: Reducing capacity in times of declining production in agriculture, developing products and services to help farmers become more sustainable, such as seeking out the highest segments in the market. And further internationalize. "There are fewer farmers who fit into the traditional revenue model of these companies."
c. Retail: Responding to evolving consumer preferences, for example with advertising for organic or vegetarian and stating the CO₂emissions of the groceries on the till receipt. "They also got the Netherlands into sherry at the time, so they can do quite a bit."
d. Banks: Sustainability as a starting point rather than as one of the many things to be managed. "And for Rabobank: keep your farmer's heart up."
e. Consumers: Less meat and more plant-based food. "In the seventies we ate 60% vegetable and 40% meat. Now it's the other way around and many people are overweight. Some things were better in the past.

AGRICULTURE IN 2040
according to Krijn Poppe

• The Dutch eat less meat and more plant-based
• All food contains a larger share of sustainably produced raw materials
• More sustainable agriculture and less 'greenwashing' due to mandatory blending
• The number of farms has fallen by about three-quarters compared to 2023
• Sharper dichotomy rural entrepreneur vs. agro-industrial
• Agro-chains focus more on high-quality food
• End of government support for business closures and conversion
• Larger share of sustainable production and side branches in farmers' income
• Restructuring of agriculture and countryside largely completed

This sponsored article is part of the series 'Speakers of the Future', an initiative of the Food Transition Coalition. In this series of interviews, written by Jeen Akkerman, visionaries give their views on the future of food production in the Netherlands. The editors of Boerenbusiness is not responsible for the content of these publications.