Opinions Jaap Haanstra
Supermarkets don't determine our income
More and more often I hear and read that it is the fault of the supermarkets that our incomes are too low. Competitive purchasing, concentration of power and monopolists are frequently heard arguments. But is that true?
That we live in a country where the cost price is high, is a truth as a cow. The costs of land and labor are high, as are cultivation and production costs. Fortunately, our production is high and of excellent quality. Together with an efficient processing industry and an excellent infrastructure, this means that a large part of our products can be exported. What we produce in the Netherlands is highly sought after in large parts of the world. Without exports, there would be no Dutch agriculture in its current form, as we know it.
Incredible performance
Unlikely export figures for dairy, vegetables, flowers, potatoes, onions (more than 90%) and many other products. An incredible achievement. Especially when you realize that the sector has the lowest environmental footprint in the world. It is not the local market that forms our income, but rather the degree of export in combination with the market supply.
Even a relatively small reduction in supply, for example due to the weather, leads to a significant price increase. The supermarkets also have to deal with the interplay of supply and demand when purchasing. And yes, they have a strong negotiating position due to their size and limited number. But it is going too far to say that the supermarkets are solely responsible for the plight of many farmers. Although that can of course be different individually.
Delve into the market
I notice, and I understand that I say it hard, that many people should first look into markets. Also how prices are established through market forces, before you blame everyone and everything. Learn how product flows run. What and where and how much is produced and what does that have to do with the price? Local-for-local is by definition bad for the Dutch farmer and horticulturist. If you don't know about that, you can't come up with the right solutions.
My predecessor Aike Maarsingh once said 'if there is a market for 100 bicycles, you should not make more than 99.' Politicians would do well to take up this market analysis and thus gain insight into how agriculture and horticulture really works. And to use this knowledge when they talk about measures again and want to impose them.
Crash Course Agriculture
European Commissioner Frans Timmermans is also advised to take a crash course in agriculture. His immense Green Deal is a reform of European agriculture and involves enormous measures and costs. And apart from the question of who is going to pay for all this, what does it mean for the competitive position of the European farmer on the world market? Surely it cannot be the case that agricultural products will soon enter the EU that have been grown in a way that is not acceptable to us and/or have been treated with substances that are not allowed to be used in our country? Unless, of course, there's a hidden agenda that we can't unravel.
What to do as farmers? We can try to arrange the quantity. But is it likely that farmers can and want to do this together? Who jumps out of the wheelbarrow even faster than frogs? Well, those are farmers. Besides, it is very doubtful whether we will actually be granted that space, despite small promises.
A level playing field
Another possibility is to return to a European policy with regulated markets. That is, to regulate the volume together with minimum prices and border protection. And yes, how likely is that? If they do take major measures in Brussels that affect all farmers in the EU, it may be the only option. Especially if production is done differently in other parts of the world than here. The minimum we are entitled to is a level playing field.
Jaap Haanstra
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