Agriculture minister Piet Adema (ChristenUnie) wants to force banks and supermarkets to make a greater contribution to solving the nitrogen crisis through the agricultural agreement. This is confirmed by the Ministry of Agriculture, Nature and Food Quality NRC.
Adema demands that supermarkets and banks make a financial contribution to making the agricultural sector more sustainable. The House of Representatives had called for this in a motion in June. Adema also wants banks to reduce farmers’ loans by ten percent, as previously suggested by nitrogen mediator Johan Remkes. This gives farmers the financial space to stop or to make their business more sustainable. For Rabobank, the ‘farmers loan bank’, this would mean that they would cancel around 3.5 billion euros in loans.
The cabinet is currently investigating how it can ensure that banks comply with this agreement, says a spokesman for the Ministry of Agriculture. If this does not work voluntarily, it may have to be forced. The agricultural agreement aims at a reform towards a more sustainable circular agriculture and must bring about a reduction in nitrogen emissions, but also concerns crop protection, animal diseases, zoonoses, public health, odor and particulate matter. In addition to farmers’ interest groups and nature clubs, supermarkets, banks, local authorities and food processors are also participating in the talks for an agricultural agreement.
Read also: Remkes soothes several conflicts in nitrogen file
Demand for sustainable stimulation
Adema wants to oblige the banks to come up with concrete proposals within six months about making their portfolio of agricultural loans more sustainable. They must also say how they can ease the burden on farmers who want to work more sustainably.
Supermarket groups are also given six months to let them know how they can stimulate the demand for sustainable products and how they can improve their support for sustainable farmers. Adema also wants to set up a campaign in collaboration with the Ministry of Health to better inform consumers in the store about the actual environmental costs of their purchases.
With the plan to force supermarkets and banks to make a greater contribution to agricultural sustainability through the agricultural agreement, Adema is building on the work of predecessor and fellow party member Henk Staghouwer. Staghouwer had wanted to present his plan this year, but resigned as minister at the beginning of September. In a statement, he said he was not “the right person” to lead the challenges that lie ahead.
Adema awaited the Remkes report at the beginning of October before presenting his plan for tackling the nitrogen crisis. That he did via a letter to Parliament on 25 November. In the run-up to his letter, Adema tempered expectations. His long-awaited letter was no longer called the ‘perspective letter’, because it sounded too positive and gave false hope to the agricultural sector. Not every farmer would be able to continue his business, some farmers will have to stop in the coming years. Remarkably enough, his letter nowhere shows that Adema takes the same hard line as Staghouwer. Adema hopes to conclude an agricultural agreement with farmers, supermarkets and banks next year. Until then, he hopes to be friends with all parties.
No contact with the minister
Rabobank says it is “open” to “a role” in the agricultural agreement, but does not yet know what that will look like, says a spokesman for the bank. And, according to the bank, canceling loans from farmers who want to stop or become more sustainable is “not an issue”, because the bank cannot simply cancel loans.
The Central Bureau of Food Trade (CBL), the sector organization for supermarkets and other food companies, states that it has had no contact with Minister Adema or his predecessor about the contribution of the supermarket sector to making the agricultural sector more sustainable. The CBL doubts whether the government can legally enforce this contribution.
In his letter, Adema broadly outlines how he envisages making Dutch agriculture more sustainable, but is otherwise not very concrete. For example, he wants to make agreements with banks about how they can support farmers in the transition through financial relief or attractive arrangements for farmers. He does not explain what he means by this.
Rabobank, with a market share of 80 percent by far the largest financier of the agricultural sector in the Netherlands, previously indicated that it could do little itself to increase the pace of sustainability. Financing sustainable farmers is often not profitable because the demand for their products lags behind, the bank stated earlier in a conversation with NRC.
A version of this article also appeared in the December 6, 2022 newspaper