Lean years for farmers

08/12/2003 10:00

In the period 1995-2002 selling prices in agriculture rose by an 1.2 percent a year. The costs, however, rose by an average 2.4 percent.

Prices for farmers and consumers

Prices for farmers and consumers

Good years and bad years

The prices farmers receive for their products fluctuate strongly, much more strongly than inflation. In the relatively good years 1996, 1997, 2000 and 2001, prices rose at the same rate as costs. In the bad years, 1998, 1999 and 2002, selling prices rode by much less than costs, however.

Prices of some agricultural products, 1995-2002

Prices of some agricultural products, 1995-2002

Flower prices increasing

There are substantial differences in price developments between various agricultural products. Cut flowers, for example, yielded more than 4 percent per year more in the period 1995-2002. In the same period, however, prices of meat, cereals, potatoes and sugar beet decreased. The price decrease for cereals is partly compensated by European subsidies.

Prices for some cost items, 1995-2002

Prices for some cost items, 1995-2002

Market gardeners pay more for energy

Most costs rose at the same rate as inflation. The strong increase in energy prices, and especially natural gas for gardeners growing crops under glass, was an exception. This is important for growers of cut flowers, which are mostly grown in glasshouses. This counteracts the increase in selling prices for a large part in this sector.

Cattle feed prices stable

The main cost item in agriculture – accounting for about one third of costs in 1995 – is cattle feed. The price of cattle feed has remained at about the same level in the last seven years. However, this moderate price development cannot compensate for the decrease in meat prices.

Reinoud Segers (Statistics Netherlands)
Jan Bolhuis (Agricultural economic institute, LEI)

Source:

StatLine Prijsindexcijfers landbouw (1995=100)  (Dutch only)   Consumentenprijsindex (1995=100) (Dutch only)
Bolhuis, J.  Prijsontwikkelingen in de Landbouw.
Agrimonitor 2003(3), LEI. (Dutch only)