'No Danish fall, but land price falls'

"We will not experience a price drop like in Denmark here, but the current prices for land cannot last long," predicts Rick Hoksbergen, one of the faces of Alfa Accountants.

Hoksbergen made his statements on the opening night of the one-day Northern Netherlands agricultural fair Agrarische Schouw this week in Joure. Based on figures from the European Dairy Farmers, he pointed out that the critical milk price in the Netherlands had risen from 31 to 37,4 cents in the past ten years. "As a result, the Dutch dairy farmer has dropped from the middle bracket to the worst scoring 20%. We are now at the bottom of the European ranking."

Bills just paid
Land-relatedness, phosphate rights, nitrogen limits and other restrictions make cheap farming in the densely populated Netherlands impossible. Hoksbergen focused in particular on the situation in the Northern Netherlands. "The milk price has not moved too badly lately around 37 cents, based on an estimated average multi-year price of €0,35. But most dairy farmers are currently able to pay just about all the bills. That situation corresponds nicely with the current situation. Dutch break-even price of about €0,37."

Hoksbergen stated in Joure that a dairy farmer needs 5 cent margin on the break-even price for every 1% growth. "A farmer who wants to buy agricultural land and phosphate rights will have to be well below 37 cents with his break-even. At most 30% of entrepreneurs achieve this in the Netherlands, so most dairy farms there are stuck."

A matter of time
All the more so because dairy farmers have already used a lot of their own money in recent years to finance the expansion of the company. As a result, the bottom of own resources is approaching more and more companies. "This means that fewer and fewer farmers can purchase even larger areas of land. Then there will come a time when the tide will turn."

Hoksbergen's conclusions are clear. “Despite a continued tight supply of agricultural land and increasing investor interest, returns and equity on most dairy farms are too low to be able to buy land at current prices. farmland goes down."

As far as he is concerned, the course of continuous scaling up and intensification is a dead end. "We have to think of something else, otherwise we will lose it internationally on all fronts."

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