For more than a century, Marc Bernhardt’s family has run a dairy farm in the Saxon countryside in eastern Germany. But passing the baton to the new generation will be difficult, warns the breeder.
His production costs increased by “40%” after the war in Ukraine, and the price of electricity increased by “50%”, he told AFP. “If we continue like this, we will have to do something else,” complains the 37-year-old farmer from Freital, south of Dresden.
While the average income of German farmers increased by 45% last year, family farms, which account for half of the sector’s businesses in Germany, still suffer from high production costs that they struggle to cover.
Difficulties that explain the extent of farmers’ mobilization since the beginning of the year against the suppression of tax advantages for agricultural diesel.
Thousands of them gathered on Monday with their tractors in Berlin, in front of the emblematic Brandenburg Gate, to conclude a week of mobilization against this project.
– “Same job, less money” –
On his farm of around a hundred dairy cows, where he also grows cereals and corn, Marc Bernhardt works alone with his father. The latter took over the farm in the early 1990s, returning to the family after years of collectivization under the East German communist regime.
Today, dairy production is fully automated and the cows move independently to the milking machine, which works without human intervention. A robot vacuum cleaner regularly cleans the stable.
For Marc Bernhardt, the removal of diesel exemptions will lead to a reduction in his subsidies by “10-15%”. In Germany more than half of agricultural income depends on public aid.
“It’s not fair to offer the same amount of work for less money,” protests the burly bearded man.
Member of a collective of independent farmers, he also went to demonstrate in Berlin on Monday.
The elimination of tax loopholes was decided to fill the gaps in the country’s budget for 2024, after a call to order by the Constitutional Court.
The government estimated that as farmers’ incomes have increased in recent years, the sector could absorb these cost increases.
“It’s a fair contribution,” Liberal Finance Minister Christian Lindner defended to farmers in Berlin on Monday. “My goal is not to weaken agriculture,” he said, to boos from the protesters.
According to industry data, in 2023 German farmers achieved an average annual profit of 115,400 euros from their main activity: a record and around 45% more than in 2022.
These good results can be explained by “short-term price increases” on the markets in the last two years, in a context of inflation in all developed countries, Martin Odening, professor of agroeconomics at Humboldt University in Berlin.
– Diversify your income –
But “we must not forget the losses of previous years, especially since prices remain volatile”, fixed on global markets, Odening emphasizes. Some have already declined recently, especially milk.
Above all, the level of income “is only average”, notes the expert. “Some agricultural companies have not been able to compensate for the increase in costs with this increase in turnover”, he points out.
Added to this are, for small facilities, expensive investments to comply with environmental regulations, as well as the difficulty of finding labor and a buyer when the operator retires, according to a study by DZ Bank.
These factors make the economic survival of family farms and small and medium-sized structures difficult, while international competition imposes ever higher levels of profitability.
“We really ask ourselves whether it is still worth having a small farm like ours,” says Nathalie Diebow, 26, currently in training, who demonstrated last Thursday in Cottbus (east).
According to the DZ Bank, the number of agricultural holdings in Germany, which decreased by 12% between 2010 and 2020, is expected to increase from the current 256,000 to 100,000 by 2040. With this concentration phenomenon, their average size is expected to increase from 64.8 to 160 hectares.
To diversify his income, Marc Bernhardt decided to open an inn, an educational farm and install solar panels. But for him nothing can replace milk production: “It’s in my blood.”
Do you have a real estate project in mind? Yakeey and Médias24 help you make it happen!
2024-01-15 22:21:45
#hardship #small #farmers #fuels #agricultural #anger #Germany