‘Nature development in the Netherlands is delayed by the high prices of agricultural land’
Bread has become more expensive recently due to increasing grain prices, and dairy products have also risen in price. The demand for agricultural products is evidently increasing strongly. This affects the prices of agricultural land. Dirk Strijker, Professor of Rural Development at the University of Groningen, claims that this in turn influences nature development in the Netherlands.
The high grain prices are mainly caused by increasing demand from Southeast Asia, Strijker explains. ‘Economic developments have resulted in people eating more meat there. The consumption of animal products is inherent to increasing prosperity. And grain products are needed to feed the pigs that will provide this meat. That is how the shortage in the market has developed.’ The current shortage of grain also has consequences for other agricultural products, such as potatoes, beets, vegetables, etc. ‘These will also become more expensive, since everything is interrelated. You can’t grow more than one crop at a time on a piece of land, so if farmers start to grow more grain, less rapeseed will be grown.’
Strijker expects the high demand for grain and other agricultural products to stop at some point. ‘When prosperity increases, people from the countryside tend to move to the cities. This creates a shortage of labour in the rural areas, which leads to mechanization in agriculture. New techniques will cause the land to be used more intensively and after some time these countries will more or less be able to feed themselves. I expect this to take another ten to fifteen years.’
More expensive agricultural land
The current shortage of agricultural products causes an increase in the world-wide demand for agricultural land, which will lead to higher land prices, in the Netherlands as well as elsewhere. Strijker: ‘This will not affect the housing sector, for example, since land that is suitable for building is much more valuable.’ The trend will, however, have consequences for nature development. Large amounts of agricultural land have recently been purchased by the government to be turned into nature reserves. ‘The increase in prices will make this more difficult. After all, there is only a limited amount of public funds available. Farmers will be less eager to sell their land now.’ Strijker therefore expects the completion of the Dutch National Ecological Network to be slowed down.
Gone too far
Strijker is not sorry about this. ‘We have already made a good start. Perhaps we should slow down a bit now, until the prices for agricultural land start falling again, and then continue. I sometimes think we have gone too far. A lot of new nature areas have proven difficult and expensive to manage. Wouldn’t it be better to simply have cows graze in those areas?’ Furthermore, according to Strijker, the support for the conversion policy from politics and society has declined. ‘It is just like arts subsidies: the nature that is being developed now is mainly interesting for a small group of highly educated people.’
Not everything will remain expensive, Strijker expects. ‘The prices of dairy products will be able to drop fairly soon. The milk quotas will be abolished in the near future, allowing farmers to produce more milk. Many farmers have therefore already started expanding their sheds. However, Strijker notes, the higher supermarket prices are not only caused by the higher prices of raw materials. ‘Retailers and industry are using these developments to make up for the damage suffered during the supermarket war. They are now trying to bring their margins back up to sufficient levels. After all, the raw materials only account for a small part of the costs of producing a loaf of bread.’
Dirk Strijker (1953) is S.L. Mansholt Professor (endowed chair) in Rural Development at the Faculty of Spatial Sciences of the RUG. He studied Economics in Groningen and has worked as a lecturer at the RUG since 1988. In 2000, Strijker gained his PhD at the Universiteit van Amsterdam with a thesis on regional differences in European agriculture. Strijker is an expert in the field of rural development and European agricultural policy.
|Last modified:||15 September 2017 3.10 p.m.|