Fewer farms handed over to successors

09/05/2006 14:00

In 2004, just over 12 thousand farmers, nearly 15 percent of all farmers in the Netherlands, had a successor ready to take over their business in 2004. In 1996 more than 23 percent of farms were assured of a successor taking over.

Tens of thousands of over-55 have no successor

The issue of who will continue the business is relevant for the around 40 thousand farms with heads aged 55 years or older. 23 thousand farms have one head, and only 4 thousand of these have made arrangements for handing the farm over to a successor. The remaining 17 thousand farms have more than one head and are often partnerships. Eight thousand of these have made arrangements for succession, 9 thousand still have no arrangements for who will take over when the current head retires. This means that for 28 thousand of the 40 thousand farms whose heads will retire in the period 2004–2014 no arrangements had been made in 2004 for the succession of the farm.

Age of successors

Age of successors

Takeovers postponed

The number of farm successors aged under 30 has decreased substantially in recent years. In 1996 more than half of successors were younger than 30 years, in 2004 this was only one third. This has made it more difficult for young farmers to take over a farm.
Apparently the takeovers are being postponed so that the successor can build up capital by working on the farm.

Fewer farms

Partly because there is less interest in taking over the businesses, more farms are going out of business. In the last ten years, about 8 farms a day closed down. In 2004 there were 83.5 thousand farms in the Netherlands, down from 111 thousand in 1996.

Farms

Traditional and rational considerations

There are various reasons for the diminished interest in taking arm takeovers. One is that traditional considerations are taking a backseat; farmers have become more rational in their decision-making. More often than in the past, the declining interest is connected to economic results, regulations and the nature of the work, which often involves irregular hours.

Higher educational levels

Farm successors are also more likely to have ea higher level of education, which increases their options. On nearly 20 percent of farms with a successor, the latter has a higher professional college diploma or a university degree. In 1996 this was only 13 percent. By far most farms (66 percent) are taken over by a successor with senior vocational diploma.

Educational level of successors

Cor Pierik