PR - Scenario Analysis On Farm Income Of Dutch Dairy Farmers Through 2020
Dairy farmers in the Netherlands and in the rest of Europe have to cope with fast and vast developments in agricultural policy. The outcome of the CAP reforms, WTO negotiations, and changes in agricultural markets are uncertain. Each farmer should be well aware of the possible consequences. However, it is difficult to translate these developments into concrete expectations on future income levels. In this study we try to give sense to the possible outcomes under various scenarios.
A reference scenario (‘baseline’), as well as two alternative scenarios (‘liberalisation’ and ‘regionalisation’) are considered. For each of these scenarios the trends in price level and price variance are estimated for the input factors: milk prices, animal returns, feeding costs and manure disposal costs. Using the estimated prices of the input factors, a dairy farm model is used to calculate future farm income. The effect of regionalisation and liberalisation on the future level and fluctuations in farm income is apparent.