Science - March 31, 2010

Breaking the mega farm myth

Producing food for the world market in a mega farm is uneconomical in today's agriculture crisis. This is one reason which supports the general consensus opposing mass housing for livestock. A farmer knows very well that it pays to heed the consumer. 'The closer a farmer is to the consumer, the higher his profit margin.'

Pig barn in Elsendorp.
The provincial government of Brabant came down hard on mega farms last week. It has stipulated that an intensive livestock farm should not be more than 1.5 hectares big and one storey high. The province will also reduce the number of agricultural development areas where intensive pig and chicken farms are concentrated. In this way, the government wants to halt the growth of mega farms. Almost all the political parties consider that Brabant has reached its limit with thirty million chickens, pigs and cows.
So far, farmers have not protested against this ruling. In fact, the top men in the farming community even support the move. Like citizens, farmers are also against industrial meat production in mega sheds, said Hans Huijbers, chairman of the Southern Agriculture & Horticulture Organization (ZLTO) in early March in the Agrarisch Dagblad.  Henny Swinkels, director of the biggest veal producer in the Netherlands, the Van Drie Group, does not want any mega sheds either. During a symposium of the livestock students' society De Veeteelers on 11 March, he said: 'We place a high value on the relationship between people and animals. For that reason, mega farms are out as far as we are concerned.'

End
These remarks spell the end for the popular growth phenomenon of post-war Dutch agriculture. For many years, the growth of specialized farming enterprises which can produce many kilos of meat, milk and vegetables at low costs for the world market has been considered by policy makers to be the best business strategy. Dutch agriculture and horticulture sectors have built up a good export position within Europe. 'Now that the game has extended beyond Europe, we find it rather threatening, because it's cheaper in Brazil', says Siem Jan Schenk of North LTO.
In the current agriculture crisis, with stagnating demand and low product prices in Europe, getting bigger does not automatically mean getting richer. Profit-makers have to tune their production to the consumer, the supermarket and the processing industry. Therefore, the Van Drie Group supplies calves to thousands of Dutch veal producers, and tells them exactly what feed to use, how much  free space the calves should have and which medicines are allowed. 'We know exactly where each piece of meat comes from and what raw materials are involved', says director Henny Swinkels. In this way, he can vouch for the product quality, introduce a brand name and fetch a higher price. 'Our secret is delivering directly to the supermarkets.'

Vacation trip
In his situation, Swinkels cannot afford to have a bad reputation as far as animal welfare and animal diseases are concerned. If he releases control within the chain, veal will become an anonymous product again and prices for veal producers will fall to the level of world prices. Therefore, Swinkels invests, for example, in the Comfort Class livestock truck which turns livestock transport into a vacation trip.
'The most productive companies are not necessarily the best', says rural sociologist Jan Douwe van der Ploeg. 'Specialized enterprises which produce for the world market are facing more and more difficulties.' Farmers and market gardeners who have invested big sums to expand rapidly to cater to the world market are making losses, according to banks and accounting offices. Farmers who develop their businesses gradually and who keep their costs low, can maintain their incomes. It pays farmers to be frugal and efficient in the current situation, says Van der Ploeg.
Tightening circulation flows to reduce energy loss or to alleviate the manure crisis in agriculture is good for both the environment and the purse. If the farmer can make an extra quality visible to the consumer, he can 'brand' his product and get a higher price for it. Van de Ploeg has been promoting regional and local products with added value from so-called multi-functional enterprises for many years. But this is just one of the many niches in the market.

Margin
'There isn't just one direction for agriculture to go', maintained ex-minister Cees Veerman during the symposium of De Veetelers. 'The farmer is an entrepreneur. If he loses control of the marketing of his products, he shouldn't complain about small profit margins. The closer the farmer is to the consumer, the bigger the margin.'
And yet, farmers will keep on upscaling their enterprises for the export market.  Veerman says: 'Farmers are at the crossroads and wonder whether to expand their businesses or not.' Those in favour of growth point to the increased demand for food in Asia, which will inevitably push prices up again. Production ecologists, however, feel that to cater to this increase in demand, an intensive farm - with a high production rate per hectare and efficient use of water and nutrients - is better for the environment than an extensive farm. Van de Ploeg, too, thinks that up-scaling will continue. 'The legislation in North Brabant concerns the size of the sheds. Farmers can still expand their production by buying sheds in more locations.'

Battle
He adds: 'As long as the public relates extensive farming to animal diseases such as Q Fever and high antibiotics consumption, the battle between farmers and citizens will continue in society. As such, the ruling of the provincial government of North Brabant concerning the mega shed - a symbol of expansion and specialization - is very significant. Power wielded within the province is shifting.' 

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