Has Adema already been on a bio-tour through France?

Has Piet Adema already paid a working visit to France in the few months that he is now Minister of Agriculture? Probably not. And that's no shame, given the complex files he has hanging on his bike. Nevertheless, a flash visit from France would not have been amiss, before yesterday (December 19) he signed his signature with a broad smile on the action plan for a forced expansion of the Dutch organic agricultural area until 2030. 

First of all, I have nothing against the organic farming sector. In fact, during my studies I did an internship at an organic American arable farm and I look back on it with great pleasure. Not a bad word about that sector. I would, however, like to question the persistent political will to scale up organic agricultural production at any cost. And not just a little bit.  

We have known for some time that European Commissioner Frans Timmermans has sky-high biological ambitions with 'his' Green Deal. This week it appeared that Minister of Agriculture Piet Adema also wants to make an organic revolution in his own country in order to comply with the Brussels plans. In short: in 2030, Adema wants 15% of the agricultural area to be organic. This amounts to an increase from 80.000 to 300.000 hectares of organic agricultural area. Especially in the land-based sectors; dairy farming and arable farming, the idea is that growth should take place. Consumption should also grow. A total of €26 million will be invested in a new biological transition plan. It is strange that the area is chosen as a measure of success, the market share on the shop shelf should actually be that. This in the context of market-oriented production, in which the organic sector is traditionally strong. 

France sales crisis
The organic ambitions of Agriculture Minister Adema are quite risky. The supply side can be molded through subsidies, but the sales market cannot be made. It turns out in France. In recent years, French dairy farmers have switched en masse, fueled by the price crisis on the dairy market and government stimulus. Some figures at a glance: In recent years, organic milk production has grown by no less than 35% to 848 million kilos. But now the changeover switches are sitting with the baked pears. The organic dairy farming sector there has been struggling with a large surplus for a year and a half. Large processors such as Sodiaal and Lactalis are forced to sell up to a quarter of the organic dairy as conventional. At the end of 2022, the problems are still not solved. In fact, the surplus is even growing, because the demand for organic dairy is declining more than conventional dairy sales. This is due to the high inflation.

Also in your own country sputters organic sales, as in many other Western countries, including the United States. The high inflation is throwing sand into the sales engine, which has accelerated more and more in recent decades. Although inflation is now cooling down somewhat, it will remain high in the coming years. Around 5% even, thinks De Nederlandsche Bank. Wages will probably not compensate for inflation, although many companies are taking their responsibility this year. This is not a favorable prospect for the cyclical organic agricultural sector, to use the 'P-word' again.

French working visit
For the biological precursors, I think it is also a threat that politicians in The Hague will use heavy artillery to encourage the transition. After all, the distinctiveness of these entrepreneurs is diluted if the acreage is artificially increased. In other words: they will immediately pay the bill if the organic market becomes further oversupplied and the additional price comes under pressure. It would be better for Adema to invest energy in increasing the organic demand - if growth is the goal - at a fair price. Farmers are entrepreneurs. If there is a question, it will be filled in automatically. As a politician you don't have to do anything about that, in other words market forces. A bio-tour through the French countryside would therefore not be so bad for Adema in the coming winter months. Can he immediately recover from the first months as agriculture minister, which must have been very busy. 

Wouter Job

Wouter Baan is editor-in-chief of Boerenbusiness and Food Business. He also closely follows the raw materials markets and focuses on animal proteins such as dairy and meat. He regularly interviews leaders from the agricultural sector and the food world.

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