Inside Germany’s farmer protests: Who wins in Europe’s agricultural transformation?

14 Feb 2024 --- German farmers are protesting against government plans to abolish diesel subsidies and motor vehicle tax exemptions in agriculture, but environmental groups claim such measures are necessary for sustainable food systems. NGOs also stress that public funds must be allocated to support farmers in their transition to more sustainable agricultural practices.

Last month, thousands of farmers blocked highways with tractors and congregated on the road leading into the Brandenburg Gate in Berlin, the nation’s capital. Now, the German Farmers‘ Association (DBV) is focused on making its message more visible and engaging in constructive talks with politicians.

The association claims measures to cut diesel subsidies and vehicle tax exemptions, which were revealed unexpectedly as part of the government’s 2024 budget, would hit the sector with an additional €920 million (US$992 million) per year in costs.

“A tax increase of this magnitude for a single sector is unprecedented and disproportionate. At the same time, there is still no possibility for farmers to switch to alternative forms of propulsion like electric drive. The sector has already had to accept severe cuts, thereby contributing to budget consolidation,” a DBV spokesperson tells Food Ingredients First.

Greenpeace Deutschland campaigner Matthias Lambrecht tells us that farmers’ anger is understandable since the subsidy cuts came suddenly as part of an austerity package, but ultimately the climate and biodiversity crisis is the bigger concern.

“We can no longer distribute more than €60 billion (US$65 billion) of public money as environmentally damaging subsidies. These subsidies must be reduced systematically, proactively and in a socially just manner — including subsidies for agricultural diesel,” he says.

Transitions and dead ends
For years, the German Environment Agency (UBA) has recommended that environmentally harmful subsidies be reformed or abolished, including tax concessions for agricultural diesel and the exemption of agricultural vehicles from excise duty.

However, UBA acknowledges that the agricultural transformation deserves public support — also in the form of subsidies — after ensuring the existing subsidies are conducive to sustainable agriculture.

“The existing subsidies would be better invested elsewhere, for example, to support farmers who minimize their nitrogen and phosphorus footprints or create flower strips on their land to support biodiversity,” Dr. Knut Ehlers, research associate at UBA, tells Food Ingredients First.

Subsidized food production can result in cheaper consumer products, but in the longer term, third parties will need to pay for intensive farming, for example, because drinking water is contaminated with nitrate, warns Lambrecht at Greenpeace.

“It makes more social sense to use public money to promote climate-friendly agriculture and avoid external costs that regularly affect the poorest. Some foods may become more expensive if producers have to avoid external costs, but this is in line with the polluter pays principle, and it can be offset if environmentally-friendly food is taxed more favorably, for example, by exempting it from VAT,” he explains.

Greenpeace is concerned that DBV’s “uncompromising stance” and “insistence on the promotion of agricultural diesel” will lead farmers to a dead end.Last week, the European Commission revealed new plans to dilute its farming-related GHG emission targets.

“Instead of instrumentalizing small and medium-sized farmers, who fear for their income, to push through the interests of industrialized agriculture, DBV should use the momentum to advocate for a sustainable agriculture that is fit for the future and in line with farmers’ interests,” says Lambrecht.

German farmers tell us they want tax relief and measures to strengthen individual farm risk management, tax exemption for the use of non-fossil fuels and a moratorium on agricultural regulations in conjunction with a program to restore competitiveness in the European internal market.

Greedflation grips sector
For Slow Food, an organization promoting local food and traditional cooking, the widespread European farmer protests should not be viewed through the lens of agriculture versus the environment. The underlying problem, the organization argues, is “greedflation” — firms increasing profit margins from supply and demand mismatches and uncertainty created by high and volatile inflation.

“It’s concerning that the cost of food has gone up and, at the same time, farmers struggle to make a living. The planned subsidy cuts for diesel in farmyard vehicles and the vehicle tax exemption are piecemeal measures that lack a coherent framework: under these circumstances, the planned tax adjustments will not work, and the protests are the logical consequence,” Marta Messa, secretary general at Slow Food, tells Food Ingredients First.

“Food corporations are thriving…[but] farmers are caught between the pressure of policies, the food industry and large-scale retail distribution. The generous subsidies from the EU’s Common Agricultural Policy and the advisory services they rely on have been strongly geared toward industrial farming and higher production since 1960.”

Slow Food Deutschland is part of the “We're fed up!” alliance, which unites farmers, conventional and organic, from animal husbandry to agriculture. The coalition calls on the federal government to implement several new measures, including fairer prices for farmers and for EU agricultural funds to be allocated as reward measures for animal welfare and environmental protection.The German Environment Agency says it needs farmers’ support since most on-field environmental protection measures are measures only farmers can take.

EU politicians react
According to DBV, what unites Germany’s discontented farmers with farmers protesting elsewhere in Europe is the “general feeling of being blindsided by often unrealistic and impractical policies from Brussels.” German farmers demand an effective initiative to reduce bureaucracy at the national and European levels.

However, last week, the European Commission revealed new plans to weaken its agriculture-related GHG emission targets. Specifically, The EU 2040 Climate Target final text no longer mentions a 30% cut in non-CO2 emissions from agriculture, such as CH4 emissions from livestock and N2O emissions from soils.

Environmentalists accused policymakers of favoring discontented farmers over long-term climate change mitigation, while animal protection groups warned the new plans would not support animal welfare reform. But Copa-Cogeca, an organization representing EU farmers, told us it was pleased that “a dialogue with farmers has finally been chosen.”

Ultimately, sustainable agriculture requires sustainable consumption patterns with a focus on food waste reduction and plant-based diets, according to UBA.

“In the context of the EU’s Common Agricultural Policy, it is clear that both the European and national levels should attach payments to farmer’s efforts to promote biodiversity and reduce GHG emissions instead of reinforcing an agriculture that produces food at the expense of the environment and climate,” says Ehlers.

By Joshua Poole