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Staff Member
There is always something to worry about. The weather, is ploughing bad for your soil, are new EU rules going to make your life difficult. The following issue is no different but it has fixed my mind as I find it highly disturbing.
As many of you will know the arable areas of The Netherlands are farmed very intensively. A fellow forum member even described it as the most abused piece of dirt in the world, and he is probably right. This is due to a good reason. We usually have an unlimited supply of fresh water to irrigate, it is relatively easy working, delivers high yields and has no stones. Seems fine, but there is a problem. Everyone outside the agricultural branch is now realising its value. Unlike Great Britain, Germany or France we don´t have much land and the amount is being decreased a great amount annually. Especially with the housing market rising again the land grab is set to continue where it stopped in 2008.
The result is that land prices are being pushed through the roof. The best bits of land, mainly found in the Flevoland polders, have always been top banana but even the moderate to low quality soils are now fetching good money. Your average arable ground is now worth around 60.000 to 70.000 euros per hectare. Converted that comes down to 19.000 to 22.000 pound per acre. The high quality soils go even further. Land prices are ending in the higher nineties. All this wouldn´t have been so bad if crop prices would rise as well. Sadly they don´t, and the costs keep rising. I understand this is much the same in the UK, also to worrying levels, but the problem is made worse over here.
Not many family farms remain in today´s farming industry. A large portion of the land over here, like in the UK, is owned by private company´s or churches. A large amount, especially the more recently created polders (from the last hundred years or so) are mainly owned by the government. They lease their land to owners for a period ranging from four to a hundred years. Rents keep climbing though, as land prices go sky high. Recently, the government has realised the potential on financial returns when hiring out the land to farmers has not been put to its full potential. Farmers that grow seed potatoes or other high value crops like flower bulbs pay rents per hectare that start with £2.200 and go up another £1.000 or so. To start with, this means smaller farmers cannot rent land anymore as they can’t afford to pay this kind of money. A few large farms grow lager and continue to pay silly rents for as long as the bank says its ok.
The government has now started a similar process. It has said that a lot of the land, whose lease is ending, will be made publicly available for everyone. You can fill in a piece of paper with the amount of money your willing to rent it for a period of four years. Recently one of these ‘auctions’ resulted in a 30 ha piece of thoroughly destroyed farming land being rented out for 3.250 euros per hectare PER year. Of course the long term rent comes with a lot of small writing saying what you can and cannot do. These include growing breaks (cereals), which won’t make you any profit, and growing cover crops. If the land turns out to be infected with nematodes or other soil born diseases you have to pay a fine. The problem being there are no reliable tests available for such issues.
As farmers keep being offered sacks of money to sell land for houses, green houses or industrial estates there is a market for expensive land. The smaller farms, the family farms and the young guys that want to get into farming haven’t got a chance. Other than that the land is being destroyed year after year to get a maximum yield that pays for the silly rents. Cereals are no longer grown as they only cost money. Another problem arises as fathers, that today buy land for 90.000 euros, won’t be able to pass it onto their sons. With a typical arable farm these days of 100 hectares, at a value of € 40.000 your talking about a sum of four million for the land alone. The bank won’t lend it to start with and you won’t ever be able to pay for it all.
Everyone agrees land prices need to come down and care should be given to the soils. However, then the next problem arises. Everyone is now speculating on high prices and businesses are being built on the fact that the value will rise. When the land bubble bursts a fair few will have severe problems. I wonder what the future will bring us. Hopefully we can let the next generation become farmers as well.
About the author:
TFF member @Niels
Niels van der Boom lives in the middle of Holland’s youngest province, Flevoland. He runs his own business and works as a journalist and photographer for various agricultural websites and magazines. He also acts as an advisor for direct drill specialists Claydon in Holland.
As many of you will know the arable areas of The Netherlands are farmed very intensively. A fellow forum member even described it as the most abused piece of dirt in the world, and he is probably right. This is due to a good reason. We usually have an unlimited supply of fresh water to irrigate, it is relatively easy working, delivers high yields and has no stones. Seems fine, but there is a problem. Everyone outside the agricultural branch is now realising its value. Unlike Great Britain, Germany or France we don´t have much land and the amount is being decreased a great amount annually. Especially with the housing market rising again the land grab is set to continue where it stopped in 2008.
The result is that land prices are being pushed through the roof. The best bits of land, mainly found in the Flevoland polders, have always been top banana but even the moderate to low quality soils are now fetching good money. Your average arable ground is now worth around 60.000 to 70.000 euros per hectare. Converted that comes down to 19.000 to 22.000 pound per acre. The high quality soils go even further. Land prices are ending in the higher nineties. All this wouldn´t have been so bad if crop prices would rise as well. Sadly they don´t, and the costs keep rising. I understand this is much the same in the UK, also to worrying levels, but the problem is made worse over here.
Not many family farms remain in today´s farming industry. A large portion of the land over here, like in the UK, is owned by private company´s or churches. A large amount, especially the more recently created polders (from the last hundred years or so) are mainly owned by the government. They lease their land to owners for a period ranging from four to a hundred years. Rents keep climbing though, as land prices go sky high. Recently, the government has realised the potential on financial returns when hiring out the land to farmers has not been put to its full potential. Farmers that grow seed potatoes or other high value crops like flower bulbs pay rents per hectare that start with £2.200 and go up another £1.000 or so. To start with, this means smaller farmers cannot rent land anymore as they can’t afford to pay this kind of money. A few large farms grow lager and continue to pay silly rents for as long as the bank says its ok.
The government has now started a similar process. It has said that a lot of the land, whose lease is ending, will be made publicly available for everyone. You can fill in a piece of paper with the amount of money your willing to rent it for a period of four years. Recently one of these ‘auctions’ resulted in a 30 ha piece of thoroughly destroyed farming land being rented out for 3.250 euros per hectare PER year. Of course the long term rent comes with a lot of small writing saying what you can and cannot do. These include growing breaks (cereals), which won’t make you any profit, and growing cover crops. If the land turns out to be infected with nematodes or other soil born diseases you have to pay a fine. The problem being there are no reliable tests available for such issues.
As farmers keep being offered sacks of money to sell land for houses, green houses or industrial estates there is a market for expensive land. The smaller farms, the family farms and the young guys that want to get into farming haven’t got a chance. Other than that the land is being destroyed year after year to get a maximum yield that pays for the silly rents. Cereals are no longer grown as they only cost money. Another problem arises as fathers, that today buy land for 90.000 euros, won’t be able to pass it onto their sons. With a typical arable farm these days of 100 hectares, at a value of € 40.000 your talking about a sum of four million for the land alone. The bank won’t lend it to start with and you won’t ever be able to pay for it all.
Everyone agrees land prices need to come down and care should be given to the soils. However, then the next problem arises. Everyone is now speculating on high prices and businesses are being built on the fact that the value will rise. When the land bubble bursts a fair few will have severe problems. I wonder what the future will bring us. Hopefully we can let the next generation become farmers as well.
About the author:
TFF member @Niels
Niels van der Boom lives in the middle of Holland’s youngest province, Flevoland. He runs his own business and works as a journalist and photographer for various agricultural websites and magazines. He also acts as an advisor for direct drill specialists Claydon in Holland.
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