Farmers did get a lot done in agricultural consultations

At the end of Friday afternoon, the draft of the failed agricultural agreement went online. It does not contain the last points that especially the young farmers of the Nederlands Agrarisch Jongeren Kontakt (NAJK) had proposed. It does appear, however, that the farmers have gotten a lot done from the government. But it was still not enough for LTO Netherlands. In a message, the organization undermines the successes achieved.

Clarity, certainty and tranquility. According to Minister Piet Adema of Agriculture, Nature and Food Quality (LNV), that is what the outcome of the Agricultural Agreement should be for the agricultural sector. At the end of November 2022, the minister announced that he wanted to talk to farmers' organisations, chain parties, nature and environmental organizations and provinces in order to reach 'meaningful agreements' for the future of agriculture.

With these words, the Ministry of Agriculture, Nature and Food Quality leads the publication of the concept text of the Agricultural Agreement that failed last Wednesday. The agreement was expected early in the spring, postponed several times and ultimately had to deliver 'milk or roe' on the longest day of the year. Time and time again, LTO threatened to stop talking about the agreement. Prime Minister Mark Rutte and five ministers even had to be involved to keep LTO at the table, a unique situation. Chairman Sjaak van der Tak eventually had to be accompanied by his fellow board members to talk to the cabinet. Sandwiched between his own ambitions to be able to sign and the pressure of his supporters, he repeatedly played the role of Januskop in the process: it could freeze and it could thaw. In the end it turned to freezing, because he did not dare to confront his supporters with a choice that would lead to a reduction of 25 to 30% of the livestock, especially in Brabant. But all in all, Dutch farmers could have made serious partners of the processing industry (internationally) and the retail trade (especially nationally). A surprising and unique outcome of a laborious negotiation process dominated by nitrogen troubles.

Over €16,5 billion
The publication of the draft text makes it clear whether that choice was justified. The cabinet turned out to have wanted to release €13,5 billion for the agreement. Just under €3 billion was intended for new housing systems and proven innovations that reduce emissions. €8,25 billion was intended for the relocation or termination of businesses and related real estate transactions. €1 billion should go to nature management and circular agriculture and about €750 million to organic and nature-inclusive agriculture. In 2030, 15% of the total agricultural land should have been organic. In addition, ABN AMRO, ING and Rabobank set aside €2,5 to 3 billion in funding for farmers' good business plans (relocation and extensification). The Ministry of Agriculture, Nature and Food Quality wanted to make €140 million available for the Investment Fund for Sustainable Agriculture (IDL). In addition, young farmers would receive higher aid amounts. What remains of this package now that the agricultural agreement has been scrapped is uncertain. In a brief Minister Adema of Agriculture informed the House of Representatives that he will arrange support for business succession by young farmers as soon as possible and will arrange a number of measures worth €175 million.

The board of LTO Netherlands says in a long message that it had no choice but to say no. That statement sounds crazy to those who read the text of the draft agreement. The farmers got a lot done from the government. They brought in goal-driven rather than detailed means-rules. That's what farmers really want: to decide for themselves how to achieve a goal instead of being guided by regulations. Nevertheless, LTO says that the agreement on target regulations has foundered. An illogical and probably improper argument, while even the feared limitation of the number of animals per hectare (the so-called 'grassland standard') seemed to be managed in a reasonable way with target control.

Farmer Friendly in the version of LTO
If sustainability did not generate sufficient income, farmers would not be left to fend for themselves, but the main table of the agreement would look for additional measures (see point 9.5 on pages 71 and 72 of the agreement). Those who want even more are de facto asking for the financial basis on which the old Farmer Friendly of the FDF was based: farmers continue to produce and must be subsidized what the market does not pay. That is what LTO Nederland asks in so many words.

While the farmers gained confidence from the government, they wanted the golden guarantee that all their production that was not profitable would be subsidized by the government. LTO formulates as follows: 'In principle, agreements can be made at most in the Netherlands about Dutch products. But that is only a limited part of the sales. Many agricultural and horticultural products go to other European (neighboring) countries. An additional price cannot be realized in these countries. That means there is a huge risk that farmers and market gardeners will price themselves out of the market, that their products will become too expensive without having a chance to recoup their investments.'

LTO is concerned about high European basic standards that the Dutch Minister of Agriculture should start at home in order to bring them further into Europe. Such an approach does not guarantee coverage of the additional costs of sustainability, says the organization.

That standard is also part of it chain agreement that LTO Netherlands recently offered to members of the House of Representatives in collaboration with the food processing industry, supermarkets and young farmers.
The chain partners promise the farmers that they will work on realizing value creation so that consumers bear the costs. With its response, LTO makes it clear that it wants a golden guarantee from the government for that promise. In exchange for their offer of cooperation, the chain partners asked for entrepreneurship from farmers and cooperation from the government to achieve a level playing field in Europe. The government provided that support. This does not provide certainty, rightly says, among others, the Netherlands Environmental Assessment Agency. That is why the chain must act as a whole. And because that still provides insufficient guidance to inspire confidence, the government promised a safety net if it turned out less well than expected. LTO thought that was not enough.

Weird argument
Ultimately, the agreement would have failed, says LTO, due to an accumulation of measures and resolutive conditions. For those who carefully read the 106 pages of the agreement and the appendices, this is a strange argument because farmers got exactly what they wanted. They received their much-coveted target regulations from the government, a bucket of money to innovate and relocate, the commitment from the chain to actually work together for cost-effective value creation together, and also the commitment of a safety net if that were not sufficient with good entrepreneurship.

The conclusion therefore seems that LTO refuses to see the farmer as an entrepreneur, but wants to return to the first phase of the common agricultural policy in which overproduction was bought up at too high a value. However, that policy was discontinued around 1980 by the Danish European Commissioner Gundelach, under whose policy farmers had to learn to do business in a market-oriented way. This is not possible without chain partners. The major benefit of the Agricultural Agreement is therefore their very emphatic commitment to working together. Moreover, they have already taken the first steps in this direction in the form of a course in which farmers, their suppliers, banks, government, food processors and retail learn to work together.

Breathe done with LTO
Van der Tak said that he would like to talk to the government again in the long term when the relationship is less tense than due to the disappointment of now. In various tones, Minister Adema has now indicated that he is done with LTO Netherlands. The young farmers have his sympathy. The question is therefore in which public prosecutor's office LTO has maneuvered itself. De Volkskrant published a cartoon whereupon chairman Van der Tak cuts himself loose from the trunk with a saw. It seems that archaeologist and CDA member Van der Tak has placed LTO in the radical camp of Agractie and FDF, the two organizations that were his opponents. As a result, LTO loses its identity and can no longer distinguish itself from its opponents. In addition, LTO de facto embraces financial requirements similar to the FDF's old Farmer Friendly idea. Even if Dutch products are too expensive for other countries, we will continue to make them and someone should subsidize them. But of course it doesn't work that way. Farmers may also be asked to make an entrepreneurial contribution.

Bet on fall cabinet
Presumably, despite all the loot, confidence and reasonable safety nets, LTO made its choice against the cabinet because it reckons with the fall of the cabinet and the influence of the BBB; with this, the organization also drops the traditionally close relationship with the CDA. In the provinces it is now clear that BBB is concluding coalitions on both the left and the right. Whether the enterprising farmers and young farmers appreciate the choice of LTO Nederland will become clear in the coming weeks: the organization is sidelined by the cabinet and if the cabinet falls, entrepreneurs will not be able to make decisions for a long time due to a lack of political approval. frame. They have now been standing still for more than four years. If the government falls, it could easily take another 1 to 1,5 years.

NAJK, the organization of young farmers, remains polite to the large LTO, but late in a press release thinly veiled annoyance at further delay. In a press release, the young farmers say that they would have liked to negotiate further and then let the members make mature decisions about the trust they receive and the risk they run.

Cécile Janssen in editor-in-chief of Foodlog.nl

This article is part of the content collaboration between Boerenbusiness en foodlog.

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