Why are European farmers angry?
In recent weeks, farmers have taken to country roads and city streets in the Netherlands, Germany, France, Belgium, Spain, Greece, Poland, Romania, Bulgaria and Ireland. Earlier this month, farmers took their dissatisfaction to Brussels, to coincide with a meeting of the European Council.
Some of the protests have been sparked by localised issues. Crackdown on livestock numbers in the Netherlands to reduce nitrates. Increased tax on fuel in Germany. Competition from lower standard imports, lack of alternatives to prohibited pesticides and increased bureaucracy in France. The changes to the nitrates derogation in Ireland. Lower prices for imported Ukrainian grain in Poland and Romania.
But I believe there is a fundamental, common reason behind those protests. I believe it is exasperation, what the French call a “ras le bol” – literally right up to the edge of the bowl, can’t take any more. Or to quote the IFA hashtag, #EnoughIsEnough.
So, what are the issues which anger farmers?
Volatile margins and relatively low incomes
Farm incomes in Europe are around 40% below non-farming incomes, according to EU data. They consist of market returns minus production costs, plus EU supports. Market returns are notoriously volatile, determined by the evolution of global commodity prices. The cost of feed, fertiliser, fuel and other energy also respond supply and demand, and can be heavily impacted by geopolitical developments (see below). EU supports have been at best static, and in many cases reduced by redistribution measures, convergence, environmental repurposing and conditionality.
The average Irish Family Farm Income reported in the graph below – dominated by higher earning sectors like dairy and tillage – peaked in 2022 at a level which just about matched average industrial wages in the same period.
Planning for household expenditure such as children’s education, never mind necessary on-farm investments to improve the sustainability of the enterprise, can be difficult for many low-income farmers.
Imports of (potentially) lower standard, lower cost foods
Another deeply irritating issue for farmers is the unfairness they see in having to compete on the EU market with imported product, facilitated by international trade agreements. While those generally provide, in theory at least, for equivalence of standards, it is hard to persuade heavily regulated and inspected European farmers just how those can be guaranteed by the EU authorities.
Concerns over carbon leakage have also aggrieved European farmers. They are committed to change their farming practices to reduce their GHG emissions but cannot accept having to compete with less sustainably produced imports.
Having to compete against relatively lower production costs outside the EU – including labour, input and environmental regulatory costs – puts farmers at a further disadvantage.
The International Labour Organization (ILO) suggests 2020 hourly labour rates in Brazil – the world’s top exporter of beef – were US$2.87, while the same body puts Ireland’s 2022 average hourly labour rate at just under US$40. While average farm labour rates may be below that in Ireland, our minimum wage is actually five times the above Brazilian rate.
Geopolitical impacts on food security and farm economics
In the last decade, the sheer density of geopolitical events has been dizzying, and all have impacted directly or indirectly food supply chains, input and produce prices – and therefore farmers’ incomes.
The invasion of Crimea by Russia in 2014 led to Western trade sanctions and Russian counter sanctions which affected most commodity markets and prices dramatically and triggered a return to dairy intervention in the EU.
Donald Trump’s presidency from 2017 to 2020 took the US out of the global trade and climate consensus, with its withdrawal from the Paris agreement, and the introduction of additional US import tariffs on certain food and drink products.
The COVID pandemic from 2020 to 2022 practically froze all global supply chains for a period and while food production and processing were deemed essential, lockdowns fundamentally altered the nature of food demand.
The Russian war against Ukraine since 2021, and the drastic sanctions taken by the West against Russia, and Russia against the West sent the market for global staples like wheat, maize and sunflower oil into a tailspin, causing historic energy and food price inflation.
The inflationary pressures , which are only starting to ease, led to central banks everywhere hiking interest rates for the first time in a decade and a half to levels not seen since the early 2000’s.
In the Middle East, Iran backed Houthi rebel pirate actions in retribution against the Israeli war in Gaza are now severely disrupting shipping through the Suez Canal, through which 12% of global trade normally transits.
Those developments have brought food security concerns to the fore, yet farmers have been disappointed that their role in feeding the global population is not earning them greater respect.
Moving goalposts
Many commentators have said that the reason for farmers’ anger was an all-out rejection of regulations. I disagree. I think most farmers recognise that our highly regulated production systems ensure our sustainable food can compete at home with demanding European consumers as well as in premium global markets.
The regulations are not the problem, but in recent years they have been changing faster than farmers can possibly adapt. As climate and environmental considerations take more political urgency, regulations are sometimes motivated by ideology to the detriment of practical implementability. The resulting measures can fail to achieve a fair and optimal environmental and economic outcome. Impact assessments have been superficial, and not really captured the economic effect on farms.
The nitrates regulations are a good example of moving goalposts in regulations for Irish farmers.
With disimproving water quality results, stocking density calculations were first tightened last year, followed by a review by the EU Commission reducing the maximum derogation limit from 250kgs N/ha to 220kgs N/ha for many regions from this year.
Prior reviews had required various mitigation actions by farmers in derogation, but these last two are particularly challenging. Cutting cow numbers would cut organic nitrogen produced and leached into water courses at the cost of a farm’s economic output and its ability to service debt.
To sustain revenue, some farmers are making potentially problematic decisions. For example acquiring additional land to dilute the N figure, but without a change to their local operation, so no local impact on nitrates produced, but a significant additional cost in the extra land. Or exporting their slurry to fertilise another eligible farm – as the regulations allow – but having to replace the organic nutrients their land requires by spreading chemical fertiliser.
At the very minimum, farmers are being pushed into higher cost production systems, but have no visibility of what might come next. Individually, farmers have little control over water quality in catchments, so what happens if the N derogation is abolished from 2026 because insufficient improvement was achieved over a short period?
Complex bureaucracy
The veterans of CAP among us might recall that simplification was the buzz word and a key concept of the Common Agricultural Policy negotiations in 2006 and 2013. You will note that the document at the link is marked “archived” – clearly simplification is no longer a priority for the EU Commission.
The 2023-2027 iteration of CAP does not even pretend to simplification. Farmers are now left with no option but to recruit agricultural consultants – at a significant cost – because the multiplicity of rules, schemes, and obligations all requiring to be met and documented mean that their CAP payment may be at risk if they don’t get professional input.
Static CAP supports repurposed for ever-evolving asks
The CAP was initially introduced in 1962 to ensure that food was kept affordable by subsidising farmers. Our November 2022 newsletter is worth reading for a quick potted history of how the CAP evolved over its 60 years.
From the late 1990’s CAP payments were used less to manage markets and more to pay farmers directly to support their incomes. Payments were increasingly linked to higher quality, animal welfare, and sounder environmental practices.
CAP direct payments continue to represent a major part of farmers’ incomes. In 2022, a relatively strong year for farm incomes, it still made up 182% of Irish cattle rearing systems incomes, 92% for cattle (other) and 116% of sheep farming systems. (Source: Teagasc Farm Survey 2022)
With the development of the Green Deal and the Farm to Fork strategies, CAP payments have been repurposed to achieve admittedly necessary sustainability improvements.
The problem is, CAP funds make up less and less of the EU overall budget in relative terms, and in absolute terms have not increased in the last 20 years (see graph below). And so farmers’ very livelihood now depends on undertaking an increasing number of environmental and other obligations, some of which are costly, which must be documented and verified – through the increasingly complex CAP bureaucracy.
Constant criticism
I remember reading this meme many years ago:
Farming is the art of losing money while working 400 hours a month to feed people, who think you are trying to kill them.
Some of today’s media commentators would make you think this is not just a joke. Much of the criticism is focused on how conventional, commercial farmers especially are climate deniers and the worst polluters, how all animal agriculture and meat consumption are disastrous for the planet, how farmers poison us all with pesticides and herbicides.
At the extreme edge, there are also the “anti-speciesists” who claim there is no difference between humans and animals, and therefore animal farming (never mind consumption of any animal product) is fundamentally wrong. And if this makes you smile, remember, the Dutch Party for the Animals has six national parliament representatives, one MEP and a total of 92 elected representatives at European, national, regional and local levels.
Recently, linked with the wave of protests, there have also been worrying attempts to amalgamate farmers’ concerns with far-right activism.
While there are many more balanced and sensible voices around, it often feels that the anti-farmer commentary dominates. Farming probably more than most other occupations is associated with attachment to the land, a feeling of duty to previous and future generations, and very personal commitments. If your profession is constantly undermined and criticised, it can feel very personally upsetting.
Social malaise and poor mental heath
Farming can be a socially isolating occupation, and income levels tend to lag those of other professions. Financial difficulties due to volatile margins, regulatory uncertainty and feeling overwhelmed have led to worrying trends in farmers’ mental health emerging.
The focus on mental health in farming has increased in Ireland, which is a welcome development, with organisations, including the Irish Farmers’ Association, collaborating to provide farmers with advice and support. In their report “Dealing with Stress“, IFA identifies the common stressors farmers encounter, many of which feature in this article as causes of farmers’ anger.
In France, suicide rates among farmers have reached crisis stages. A 2021 study by the French MSA (Mutualité Sociale Agricole), the service which ensures social security cover for farmers and agricultural employees, found that suicides among farmers and agricultural employees aged 15 to 64 was 43% higher than that of the general population, and over 65’s risk is double that of the general population in the same age bracket.
Fundamental reset needed
It is worth remembering that, even in the global North, farmers are on the front line of climate change. Extreme droughts, floods and storms are now affecting agriculture even in temperate Ireland. The reason why so many livestock and tillage farmers are planting multispecies swards and/or adopting other environmental practices is not just to tick a CAP scheme box, but because they seek to make their farms more resilient.
Recent protests may have led to small symbolic regulatory gestures at national and EU levels, which may have helped get tractors off the streets. Don’t forget those are largely politically motivated in a year when European and various national elections are in the offing, and a new Commission will be nominated.
There is a real fear that the far right will do well in national and EP elections, and to those who believe this might help rebalance climate policy in their favour, I say, don’t be fooled. The EU and other IPCC members are all signed up to the Paris agreement. Ireland’s Climate Action Plan and its sectoral carbon budgets specify that GHG emissions must come down by 25% by 2030 for agriculture. The EU has enacted legislation for a 51% cut in national GHG emissions by 2030, and net zero by 2050.
Governments are short lived. Climate change is not going anywhere, and the urgency of climate action remains. Politicians at EU and national level need to stop looking at CAP to do everything and provide additional funds for climate action and just transition.
Farmers need to focus on continuing to reduce their environmental footprint, increase their carbon capture and the biodiversity on their farms. But they need time, financial and technical support, and yes, respect in doing so.
© Catherine Lascurettes, Cúl Dara Consultancy
