Layers Of Responsibility For Dutch Nitrogen Pollution

For decades, Dutch animal farmers have been encouraged to go big. It’s been part of a concerted government policy to increase food production in this densely populated nation. This agricultural obsession has shaped the country’s landscape. Farmers use fully 60% of the land.

The results have been astonishing: the Netherlands, a country of roughly 18 million people, is the second-largest exporter of agricultural products in the world. That’s not per capita, but in overall monetary value. So Dutch agricultural exports are more valuable than those of any other country, bar the United States.

Dutch food production is now far less about feeding people domestically – a major concern after the traumas of World War II – than about feeding a complex industry.

Financing Intensive Dutch Agriculture

It’s impossible to talk about the finances of agriculture in the Netherlands without discussing Rabobank. The bank started as a group of credit unions founded by farmers, and has grown massively since then to become one of the largest financiers of food and agriculture globally.

Within the Netherlands, Rabobank provides funds to 80% of farmers, according to the bank. On average, a Dutch farmer’s debt outstrips their yearly profit by about 20 times. The key reason is land; agricultural land is more expensive in the Netherlands than anywhere else in Europe. And farmers have an incentive to accumulate as much land as possible, given that EU agricultural subsidies are based on the number of hectares. One upshot is that it’s the largest agricultural landowners (often big companies) that receive the lion’s share of income support.

And one outcome of all this indebtedness is that Rabobank, the traditional funder of Dutch farmers, has a great deal of influence over farm-level decisions. Bram van Liere, a campaigner at the NGO Milieudefensie (Friends of the Earth Netherlands), is one of many critics saying that Rabobank has been pressuring livestock farmers to increase their animal numbers as conditions of their lending. “They have been pushing for greater intensification for decades,” even if farmers were reluctant, according to van Liere.

Indeed, in the Netherlands mega farms have increased while the number of farms overall has declined. It’s a business model, many say, that financial and political institutions have been incentivizing. For instance, the average number of pigs per farm increased from 900 in 2000 to 3,600 in 2020, despite fewer pig farms overall.

Too Many Animals, Too Much Nitrogen

It’s become all too clear that bigger is not better. In economic terms, overproduction suppresses prices.

In environmental terms, Dutch concerns about the disproportionate emissions produced by agriculture have centered on nitrogen deposition in protected natural areas (although nitrogen is far from the only environmental concern). Nitrogen is used in chemical fertilizers to produce the soy that, in turn, is fed to livestock. The combined feces and urine of animals that are crowded into barns leads to more nitrogen, which evaporates as atmospheric ammonia. There’s simply not enough space for all the manure.

“Manure is coming almost out of the barns,” says Tijs Holtkuile, a young pig farmer in the eastern province of Overijssel. Because there are limits to how much manure can be spread on the fields or used to produce biogas, it can be very costly to get the excess manure removed. “Now I have to pay a lot of money” to get rid of the manure, Holtkuile reports.

Excess nitrogen – owing in this case to too many animals in too little space – acidifies the soil, pollutes the air, and changes the nutrient balance of the water. Just one effect is worsening or bringing on asthma in young children.

The Dutch government was slow to respond to nitrogen pollution, despite having worked to consolidate farms amidst a focus on hyperefficiency. It wasn’t until 2019 that a Dutch court ruling led to a crackdown on nitrogen emissions. Many farmers felt betrayed by the about-turn in agricultural policy – leading to protests, social polarization, and the birth of a new political party, the BBB (Farmer–Citizen Movement). The knock-on effects have been seismic.

Yet amidst the furor, the role of financial institutions has largely escaped scrutiny outside of the country. van Liere argues that Rabobank essentially financed the nitrogen crisis (known as the stikstofcrisis) in the Netherlands. Rabobank has also been called out for being one of the largest financers of large, heavily polluting livestock companies in other countries. Nearly three-quarters of its customers’ greenhouse gas emissions come from food and agriculture.

A Constellation of Companies Pushing For More Livestock

Of course, no one entity is single-handedly responsible for the stikstofcrisis. Animal feed companies, supermarkets, and other financial institutions all make up the web of corporations benefitting from industrial livestock farming in the Netherlands.

So it’s unsurprising that despite sometimes being portrayed as a purely grassroots movement, the Dutch farmers’ protests have received funding from the corporations that benefit from intensive farming (and the BBB party itself is linked to food multinationals). “The farmers protests’ have been financed by large companies in the agro sector,” van Liere says. “Vion [a beef and pork processor] has for instance paid thousands of euros. Most contributions we are aware of came from the animal feed companies, ForFarmers and De Heus.”

Pig farmer Holtkuile, a part-time advisor for ForFarmers, says that he’s unaware of any support to protestors. (He himself has attended a couple of local protests, he says.)

But sometimes the interconnections are relatively easy to see. Rabobank provides services to Vion Food Group and to FrieslandCampina, a dairy cooperative that 75% of Dutch dairy farmers supply. Neither food company is considering reducing overall volumes of livestock or meat. Both, along with Rabobank, are included in the Climate Crisis Index of the New Climate Institute and Milieudefensie: a list of the 29 Dutch companies with outsize responsibility for the climate crisis.

For years, FrieslandCampina refused to purchase milk from organic dairy farmers. (A company spokesperson reiterates FrieslandCampina’s commitment to promoting organic farming and says, “Until a few years ago we maintained a waiting list for member dairy [farmers] interested in supplying organic milk to safeguard a balance between supply and demand in the market.”)

The company is struggling financially, and in 2023 paid a guaranteed price to dairy farmers that was 16.2% less than the year before. However, the spokesperson says, “we stimulate member dairy farmers by paying a variable on top of the guaranteed milk price – the so called Foqus planet premium for Sustainable Development, including pasture grazing – of a maximum of 3.50 euros per 100 kilogrammes of milk.”

Interestingly, according to van Liere, FrieslandCampina has both been targeted by farmers’ protests and expressed support for the protests. So it would be misleading to say that the farmers have just been co-opted by the interests of corporations that are squeezing their incomes. Many farmers are drawing the connections.

Currently intensive farming is only profitable for the industries around a farmer, John Arink believes. His own farm, Ekoboederij Arink, is far from intensive. It’s a mixed non-industrial holding of cows, pigs, chickens, a farm shop, a small hotel, and a restaurant. Most of the revenue comes from direct sales to customers. As the cows eat grass, which comes from the land and from a nature protection organization, Arink does not need to buy food for them.

“All the things we do, they help each other,” he says of this business model. Not every farmer would be able to, or should have to, diversify their operations to this extent, but the variety of activities makes Arink’s family less beholden to a single dairy company, animal feed supplier, or bank.

Ekoboederij Arink shows what is possible, but this relative lack of reliance on corporations is unusual. “The power with the food system is mostly concentrated in a few multinationals,” stresses van Liere. The campaigner is soft-spoken, but becomes more impassioned as he warms to his subject. “There’s dangerous climate change, and we need to stop that. And each of these companies have way more power than the rest of us.”

Changing Policies That Leave Farmers Uncertain

Rabobank recently announced a U-turn on its agricultural lending policy. Its 2040 vision for the Dutch agri-food sector mentions EUR 3 billion in loans with favorable conditions, plus other financial incentives set aside for sustainability-minded farmers. A Rabobank spokesperson explains, “At this time around EUR 100+ million has been provided as loans from this transition fund. These arrangements are available until the amount of EUR 3 billion is reached in 2030.”

According to the spokesperson, “Rabobank assesses new financing just as heavily on sustainability as it does on the financial sustainability of the company.” The bank is now explicitly envisioning a future with fewer livestock in the Netherlands, a sea change from its former practices.

But farmers don’t have to commit to smaller herd sizes to qualify for the sustainability-linked loans. Other options range from minimally transformative (adopting certain technologies, though this will not be enough to address the environmental problems) to very disruptive (relocating or changing the type of farming, for instance to crops rather than animals).

This vision depends on other entities supporting farmers. It proposes a model in which the government pays farmers for environmental services, and companies set higher prices for farmers’ goods. Dutch livestock farmers will need multiple reasons, and considerable economic incentives, to shift their farming model to be more nature-inclusive.

What the vision doesn’t include is recognition of Rabobank’s historical role in the environmental issues roiling Dutch agriculture. Though the bank has expressed some regret for the years of scaling up, Rabobank has ruled out the possibility of debt forgiveness for farmers who previously received credit from the bank to increase their herd sizes, and now are being pressured to switch gears and downsize.

Holtkuile says that he generally has a good relationship with Rabobank, although “they don’t want you to take too much risk.” His family farm received a loan from Rabobank to build a new pig barn in 2021. This now houses 1,100 pigs under the Krull concept, where straw and sawdust are laid down so that pigs can sniff around and act more in keeping with their natural behaviors, though they remain indoors. The sawdust and straw combines with pig waste to produce more solid manure. There are also 1,600 pigs in two other barns, which are raised to more conventional supermarket standards.

The Krull barn was a kind of halfway house between organic and conventional farming. Holtkuile believed that consumers would be willing to pay a bit more (about EUR 1 per kilo) for pork produced to better standards, without going all the way to organic. But it hasn’t been enough. And the farm would suffer a loss of income if it downsized the number of animals, he says: “It’s not really a solution for our farm.”

The family has resisted government buyouts so far, though Holtkuile says that the offer was generous. Holtkuile, who was born on the farm and can’t imagine working in an office full-time, says, “Farming is not only about making money. That’s something that people also sometimes forget. It’s also our life.”

Critics have argued that the immensely profitable Rabobank will profit further from the Dutch government’s attempted buyouts of Dutch livestock farmers, since these buyouts would translate into loans recovered and interest paid to the bank. Some politicians and others have called for Rabobank to help pay for a fair transition.

While some large companies are weathering the environmental and political transformations of Dutch livestock farming, the futures of individual farmers – subject to fluctuating prices, inconsistent policies, and changing diets – remain uncertain.

Holtkuile wants more clarity about “where the government exactly want to go to and not changing their plans every four years.” He says he has “thousands of ideas” for ways to improve the farm, but without certainty from financing institutions and the government, he can’t move forward on them.

“Especially for us young farmers, it’s hard. We’re just starting with our career. We’re willing to innovate and improve our farms and try things to make nature and water quality better.”

This is part 1 of a series on Dutch livestock farming. The other article is “The Netherlands, A Country Of Livestock, Grapples With Eating Animals.”

This article was reported with the support of a Clean Energy Wire (CLEW) research tour.

This article was amended on April 28, 2024 to specify that the monetary value referred to Dutch agricultural exports, not the entire Dutch agricultural sector; and to replace 'nitrogen emissions' with 'nitrogen deposition.'