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June 2010

Facts and Figures 2010The Dutch agricluster in a global context

A publication of: Ministery of Agriculture, Natureand Food QualityPrins Clauslaan 8P.O. Box 20401 | 2500 EK The Hague, The Netherlandswww.minlnv.nl © Ministery of Agriculture, Natureand Food Quality | June 2010

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Introduction

The agricultural sector is one of the mainstays of the Dutch economy. Flowers, fruits and vegetables, cheese and other dairy products, meat and meat products, beer, chocolate, starch derivatives, and seeds – the Netherlands produces them all in large amounts for markets the world over.

Changes in society at large impact the agricultural sector. Today’s increasing concerns about food safety, animal welfare, use of green spaces, and the international context in which the sector operates all have an effect, as do new ideas about the role agriculture plays in society. The Ministry of Agriculture, Nature and Food Quality’s Department of Trade and Industry serves as a contact and consultative partner for the agriculture industry. As such, the Department strives to keep the Dutch agribusiness sector thriving, sustainable, and internationally competitive in changing times.

This brochure gives an overall impression of the agricultural sector in the Netherlands as well as current developments in the industry. The data was provided by the Agricultural Economics Research Institute (LEI), part of Wageningen University and Research Centre. Given the diversity of sources used, the latest figures were not always available when the report was drafted. For this reason, the tables do not always tally with the text. Further discrepancies are due to differences in the definitions used by the various sources.

Contents

Innovations in The Netherlands• Less waste, more profits 6• Heat, electricity and CO2 in a highly efficient exchange 10• Algae Park: a project that keeps its promises 14• Biogas for an energy-neutral dairy chain 18• Mushrooms and trains from hemp and flax 22• Building with greenery and glass: buildings as generators of energy 26• New housing for Greta 21 30

1. The Netherlands 341.1 Area and population 351.2 Political structure and government 351.3 Economy 361.4 Agricultural sector 361.5 Household consumption 38

2. Agricultural trade 40 2.1 Development 412.2 Composition 422.3 Trading partners 44

3. Developments in the agricultural sector 483.1 Agricultural and horticultural operations 49 3.1.1 Number of businesses 49 3.1.2 Farmland 51 3.1.3 The environment 51 3.1.4 Production value 51 3.1.5 Productivity 51 3.1.6 Organic agriculture 52 3.1.7 Regional products 52

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3.2 Fisheries 523.3 Food, drinks, and tobacco industry 55

3.3.1 Companies, employees, and sales volumes 55 3.3.2 Multinationals and investments in the Dutch food,

drinks and tobacco industry 56 3.3.3 Retailers and the hospitality industry 60 3.3.4 Organic 61 4. Research and education 62

5. Public policy 66

Appendices 70

Credits 76

Less waste, more profits

Sustainability does not necessarily cost

more. In fact, a clever approach can help

environmentally-friendly businesses make

money. An excellent example is

Ten Kate Vetten, an innovative agrologistics

firm operating from Musselkanaal, in the

province of Groningen.

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Ten Kate Vetten produces lard from the by-products of slaughterhouses. Pork fat and skin is heated to produce a variety of fats used in the food industry. The by-products also contain collagen, a protein used to produce gelatine. Before the company moved to its present premises, Ten Kate transported collagen by refrigerated truck. ‘We didn’t get much for it,’ says Goedhart Borgesius, deputy manager of Ten Kate.

Ten Kate moved to its current premises in 2002. The brand-new premises were not connected to the gas mains, and large pipes ran to nearby Gelita, a German company that produces gelatine from Ten Kate’s waste. The direct transport by pipeline eliminated the need for about four thousand truck runs a year.

‘When we developed the new plant, our prime concern was how to optimise its efficiency.’ Cooperation with Gelita proved the solution. The German company built a factory behind Ten Kate’s premises and have since been delivered batches of protein-containing waste. ‘We don’t make the gelatine. It’s not part of our core business and it doesn’t fit in with our organisation,’ Borgesius explains.

The arrangement benefits both businesses. Borgesius: ‘Gelita benefits because it is supplied the protein at processing temperature. We benefit because we get more money for our waste, and because we have cut transportation costs by three to four thousand truck runs each year.’ And then there is the environment. ‘While that is certainly a bonus, it’s not what we set out to achieve. We’re not driven by environmental considerations – our concern is making money and this happened to present a good opportunity.’After removing the protein needed for the production of gelatine, Gelita returns what is left of the protein pulp to Ten Kate. ‘We use the last pulp to produce flavourings for the pet food industry.’ This leaves Ten Kate with virtually no waste.

Ten Kate is an extraordinary business, not just for its intensive cooperation with Gelita. It is also remarkable for it being independent of the gas mains. The pork products are heated with steam from Avebe’s Dobbestroom total energy plant. This plant supplies steam and power to the businesses on the industrial estate and they all benefit from substantial savings on their energy bills. Ten Kate’s bill was cut by 35 percent. And because the plant also saves on gas, Ten Kate’s CO2 discharge was reduced by 55 percent.

It has made the industrial estate a leading innovator in Dutch agricultural logistics solutions. The transport and processing of agricultural products has huge significance for the Netherlands. The agricultural industry accounts for 10 percent of the Dutch domestic product. Of the 650,000 people that work in the sector, two thirds are employed in product distribution and processing industries.

The Netherlands is the world’s second largest exporter of agricultural products after the United States and in some markets it is the leading market player. This is hardly surprising considering the Netherlands accounts for 80% of the world trade in cut flowers and bulb flowers. But the Netherlands is also the world’s biggest trader in coconut oil, cashew nuts and cocoa. Its innovative agricultural sector combined with an intricate logistics system enables the Netherlands to remain one of the world’s largest exporters of agricultural products.

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Heat, electricity and CO2 in a highly efficient exchange

In a polder in the Netherlands a special

partnership has sprung up between

glasshouse harvest their crops, electricity

and CO2, while the data centre will harvest

its data capacity and heat.

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The growth of ITC in our economy has made the IT sector a major user of electricity with an electricity consumption that is expected to double every six years. At present the sector accounts for 7.5% of energy consumption in the Netherlands. Pieter Duijves and Kevin Burton decided to do something about this situation, so they built Parthenon, a sustainable data centre in Wieringermeer in the province of Noordholland. This data centre, which houses large-scale traffic and storage of internet data, requires an enormous amount of electricity. Not only to keep all the computers running but also to feed their cooling systems. The new data centre will be very efficient in its use of electricity, but not only that. Through the InnovationNetwork of the Ministry of Agriculture, Nature and Food Quality the two entrepreneurs found Agriport 7, an agribusiness complex in the polder. A group of glasshouse growers there will supply the data centre with the surplus energy that is being produced. The data centre’s computers’ cooling systems generate a lot of heat that in return will benefit the glasshouse growers.

Symbiosis between greenhouses and datacentre

summer

winter

greenhouse

greenhouse

datacenter

datacenter

heat

heat

seasonal storage in shallow sand layers

Source: Innovatienetwerk

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Although the data centre’s computers require less than a fifth of the electricity supplied, this is still a substantial amount of kilojoules. The whole process will also release CO2 that can be used for production under glass. This makes for a multiple symbiosis between innovative glasshouse cultivation and what could rightfully be called the most sustainable data centre in the world. Combined heat and power generation or CHP, is a much used and efficient technique in the glasshouse sector for the generation of heat and CO2, both of which are needed for glasshouse cultivation. CHP also produces electricity, often much more than the glasshouse grower needs. This surplus energy is often sold back to the national grid whereas the surplus CO2 generally ends up in the atmosphere. Under the new partnership the data centre sells its surplus heat to the glasshouse growers that do not have a CHP system themselves and get their CO2 from growers who do. These growers in turn supply the data centre with their surplus electricity and the cycle is closed (see figure). The project also includes a storage or buffer tank built underground to ensure that the hot and relatively cool air can be accessed at the right moment. There are still many hurdles to be overcome before the symbiosis can be realised. But the collaboration between the glasshouse sector and the data centre and the Wieringermeer location provide promising opportunities that would remain unused in other partnerships. The data centre produces low-value heat, between 35 and 40 degrees Celsius. Low-value heat cannot be used for every purpose but is ideal for glasshouse cultivation. The physical proximity of producers and suppliers of heat and CO2 is a major advantage. To make the most of this symbiosis local conditions should benefit both partners, which is the case here. The glasshouse growers in the Agriport 7 location will soon have two 150 KV transformers in place, which is necessary for the double connection to the national grid they require for the exchange of energy with the data centre. Wieringermeer, which had already proved its worth for the glasshouse horticulture sector, is also an ideal location for a data centre because of the glass fibre cable network there and its proximity to Amsterdam, Europe’s leading internet hub.The building work will start in the first months of 2010. Enthusiasm for the project has not only been shown by the partners themselves, but also by the Noord-Hollandse Milieufederatie (Environmental Federation of North Holland) which has calculated that it will reduce CO2 emissions by 12200 tonnes a year. And Dutch Minister of Agriculture, Nature and Food Quality, Gerda Verburg, also welcomed the initiative, calling the cooperation between the greenhouse complex and data centre ‘a splendid example of cross-sector innovation’.

Algae Park: a project that can live up to promises

Four years of advanced research into

obtaining chemicals and fuel from algae,

with a staff of six or seven and a budget of

seven million euros.

This is the Algae Park project due to start in

Wageningen in mid-2010. It has been made

possible by investment from business,

government, including the Ministry of

Agriculture, Nature and Food Quality and

the Ministry of Economic Affairs, and

Wageningen University and Research

Centre.

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It is certainly a most promising project. Algae have proved their worth as providers of food acids which are already being produced on a fairly large scale. But this use of algae known as heterotrophs which are cultivated in the dark, is just one of the possible applications. In addition, the cultivation of phototrophic algae which need light and CO2 promises to provide a broad range of products, the best-known being bio-fuels and chemicals. This category also includes unsaturated fatty acids, which are now being used in a Dutch testing plant as raw materials for alkyd paint. Algae’s potential is so great that interest has already been shown by people planning to set up an airline business that will exclusively use algae fuel.

It is then not surprising that the reaction of people directly involved, like business development manager Brender Israël of Wageningen UR, is to temper expectations which may be too high. ‘We have just had to deal with all the hype about biofuels,’ explains Israël, ‘but we’re still a long way from concrete applications that earn money’. This has lessened expectations after the first great rush of excitement, but she does not think this a bad thing, because with the creation of AlgaePark a large number of practical applications will be studied in a realistic way. ‘We plan to compare four existing phototrophic algae cultures, research them and improve them, to eventually produce one new system. Or perhaps even two.’ The four systems already make it possible to produce bio-fuel and a whole series of components for the production of food and feed, such as fatty acids, sugars and protein.

The algae are cultivated in long, horizontal or vertical transparent tubes, set in flat vertical panels or large pools in the open air. But the problem is that in all cases the costs are still much too high. ‘With the technology we now have available we can produce a kilo of biomass in a large scale process for 4 euros. In the coming years we would like to reduce the cost price to a tenth of that, to 40 euro cents.’ This can only be done by ensuring we make the raw materials go further. In a smart process known as cascading, in addition to biofuels, all kinds of end products can be produced in successive stages from one kilo of biomass (see table). First high-quality, then lesser quality products, until we get to biofuel. ‘The technology isn’t there yet’, cautions Israël, but if we succeed our calculations show that from costs of 40 euro cents we can produce to a value of 1.65 euros. This is the light at the end of the experimental tunnel. ‘You could say that you can only produce biofuel from algae profitably if the

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fuels come at the end of such a cascade process,’ says Israël. The prospects are so good that a large number of businesses have joined the project, including multi-nationals like Unilever, Friesland Foods and Total.The business development manager emphasised that AlgaePark would be an open research park.‘The fifth system we aim to develop will of course first be available to participants who have invested in it. But any business is welcome to take part, or contact us about specific commissions.’

The return on 1000 kilos of microalgae (bulk chemicals and biofuels)

Lipids 400 kg. of which: - Chemical starting- substance 100 kg. 200 €- transport fuel 300 kg. 150 €

Protein 500 kg. of which: - for foodstuffs 100 kg. 500 €- for feed 400 kg. 300 €

Polysaccharides 100 kg. 100 €nitrogen removed (N) 70 kg. 140 €oxygen produced 1600 kg. 256 €

Production costs per kilogramme biomass: € 0.40

Total estimated value per kilogramme biomass: € 1.65

Biogas for an energy-neutral dairy chain

Dutch dairy plants collectively use as much

energy as a medium-sized town. The dairy

cooperative FrieslandCampina believes that

a more sustainable approach is possible.

By 2020 the cooperative plans to generate

all the energy required for the production of

cheese, milk and other dairy produce in a

sustainable way and to involve member

farmers in this as much as possible.

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FrieslandCampina is a cooperative of dairy farmers. ‘Our members have various possibilities for generating sustainably-produced energy,’ says FrieslandCampina representative Jaap Petraeus. They own land on which they can build windmills, manure from which methane can be extracted through fermentation and large roof areas on which solar panels can be fitted. We have pledged our commitment to using green energy, and ideally we want to obtain this from our own dairy farmers.’ FrieslandCampina wants to exclusively use green energy by 2020. ‘The industry has made an agreement with the government to ensure at least twenty percent of our energy is sustainably produced. We don’t think that target is ambitious enough and believe that one hundred percent sustainable energy use is also possible.’

Companies that produce sustainable energy, whether it is gas from the fermentation plant or electricity from a windmill, will be given certificates which they can sell. Now it is primarily the major energy companies that buy up the certificates. They can then show the papers to an accountant who must check if the green energy delivered by the energy companies has really been purchased. ‘We will also be buying certificates from our members and want to offer them at least a market price for them, but preferably a price that is better. We are working to ensure our members get a better price for the milk they produce, and for the energy generated by them.’ For this purpose FrieslandCampina opened an energy contact point in 2010.

The idea of operating an energy-neutral dairy chain comes from the platform Courage, an initiative of the Dutch Dairy Association (NZO) and the Dutch Confederation of Agriculture and Horticulture (LTO Nederland). Petraeus: ‘They came up with ideas. In 2008 we as a sector considered the future and identified three important challenges: energy/climate, cow welfare and biodiversity. We formulated specific objectives for each of these challenges. For energy/climate we arrived at an energy-neutral chain in 2020. Energy neutral means we want to ensure all the gas and electricity used in our factories and on member farms is produced carbon neutrally. Preferably via our own dairy farmers.’

In theory, dairy farmers should together be able to produce sufficient energy to make the dairy chain carbon-neutral. Dutch dairy cows produce 35 million tonnes of manure per year. Fermentation of all this manure can produce 820 million cubic metres of gas, which is three percent of Dutch natural gas use.

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Courage has since come up with new ideas that could raise the amount of energy produced by dairy farmers. According to the think tank it will be possible to recover methane from air in the cow stalls. Methane is released from the cow’s rumen, and by filtering this air you can kill two birds with one stone. Methane, a powerful greenhouse gas, is prevented from being released into the atmosphere and it can be used to generate energy. According to Courage, the air in the stalls could also be used to produce heat. The cows’ bodies warm the air in the stalls, and this warmth could be used to heat houses in the vicinity of the dairy farm.

Petraeus considers the ideas with interest. ‘That’s Courage’s job. They have to come up with a hundred plans, of which we may use perhaps ten. To achieve our objective of becoming carbon-neutral in 2020 we will have to apply techniques that have already demonstrated their worth. And certainly now the milk price is so low, farmers cannot afford to throw money away. We can only convince our members with a good business case. An invest-ment should generate money within a couple of years. Solar panels are still three to five times more expensive for this to be achieved, but these prices are expected to fall, so that diary farmers will be able to afford solar panels on the roofs of their cow stalls. The first examples of this can already be found and there is hope for the future.’

Energy produced by dairy farms in the Netherlands

Manure from dairy and breeding cows for milk prod. in stall 35640820 tonnes/yearEnergy use dairy farms 8.7 PJ/yearEnergy use dairy processors 17 PJ/year

Conversion through fermentationAmount of biogas per tonne of manure 23 m³/yearCombustion value of biogas 24 m³/yearBiogas from manure 820 mil m³Energy potential manure 19.7 PJ/yearEnergy potential co-fermentation 4.5 mil tonnes coprod. 39.3 PJ/yearEnergy potential co-fermentation 18 mil tonnes coprod. 100 PJ/year

Source : Courage

Mushrooms and trains from hemp and flax

‘The use of natural fibres is our first step

towards a composite that fully meets the

cradle-to-cradle principle,’ says director

Willem Böttger of the company NPSP in

Haarlem. Ten years ago the company

started building a flax-reinforced

catamaran, hence the name Nature

Powered Speed Products. NPSP is now a

leader in the application of natural fibres in

composites.

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Composites are materials that comprise several components. They are often combinations of fibres with a synthetic resin. Composites are a popular high-tech material because they are strong and light and can easily be manipulated. Lightweight racing bikes are made of carbon fibre composi-tes, the same material used to construct the Formula 1 racing cars.

NPSP makes composites based on natural fibres. Nabasco, nature based composites, is the brand name for the materials that the company produces and which contain natural fibres including flax and hemp. In spring 2009 NPSP started manufacturing composites where the resin also has an organic component, namely one quarter soybean oil.

‘It is not easy to find an organic resin that meets all the characteristics required for a composite,’ says Director Willem Böttger. ‘It is a tall order. It has to be UV-resistant, durable, with good manipulability. Ideally, it should also be a material that can compete with other bulk products in terms of price. We cannot yet work with fully organic materials, but we are leaders in Europe with our current processes’. The first products made of the new material can already be found in the streets around the business’ headquar-ters. The municipal authorities in Haarlem commissioned NPSP to make the street name signs from Nabasco. Böttger: ‘We see the use of natural fibres as the first step towards a compo-site that fully meets the cradle-to-cradle principle. We are now half way there, with a product that is easy to dispose of and to incinerate. Incineration, for example, is a big problem with polyester fibre, a traditio-nal composite because the glass fibres do not burn. They melt and form a dirty layer in the oven. And separating the resin from the fibres is also very difficult. After you’ve used it you can’t use it for anything else. Our product doesn’t have that problem. It can be incinerated with no difficulty and can therefore at the end of its life still deliver green energy.’

Another advantage of the organic composites is that they are lightweight. The Dutch Railways ordered train noses from NPSP, and because they weigh less, the trains use less energy. NPSP also makes the mushroom-shaped signposts for Dutch Automobile Association bicycle paths, solar facades and special loudspeaker horns. ‘Most customers want to pay more because they consider they are fulfilling a role to society by purchasing these products. For the speaker horns, the special quality of our product was important as natural materials deliver better sound quality.’Last year NPSP won a competition for innovative ideas and was awarded some 400,000 Euros from the Ministry of Agriculture. Nature and Food

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Quality’s programme for Small Business Innovation and Research. Of course, that’s not much for a big company, but for us it is. We can use that money for research to improve our products even more. Our final objective is to make a fully-reusable product with the help of solar energy. Then all the circles will be complete. We can only keep using fossil fuels for another forty years, we must have made some progress in that time.’

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Building with greenery and glass: buildings as generators of energy

Light, heat, air quality, living, working and

greenery all rolled into one: an entirely novel

mixture. That’s what the ‘Bouwen met

Groenen en Glas’ (building with greenery

and glass) project is all about. The

InnovationNetwork, the ‘do and think tank’

of the Ministry of Agriculture, Nature and

Food Quality, has been working on the

concept for years. Several architects have

shown an interest. Designs have been made

for a wide range of uses but tangible results

have also been delivered. Houses for

instance, an office, and a college building.

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Project leader Peter Oei of the InnovationNetwork particularly welcomes the attention from architects and project developers. ‘It is after all a new concept, an entirely different way of thinking. In such cases it is important that those with a key role in spreading new ideas can see the benefits.’ What is so special about this building concept? ‘We aim to make buildings that generate energy, literally as well as figuratively,’ Oei explains, ‘using greenery and glass. People in these buildings will feel better, perform better and absentee rates will be lower than in conventional buildings.’ This is because interiors are bathed in daylight, air quality is better and people can work in a green environment. Moreover, and this is the main reason behind the idea, these are energy-neutral buildings.

Novel techniques mainly pioneered in the glasshouse sector play a pivotal role in this new approach to building. For years the sector has been working to reduce its dependency on fossil fuels. Under the Greenhouse as Energy Source Programme, a new solar energy saving and storage technique was devised. In summer when the sun shines, the heat is stored up for use in winter when there is less sun. This way, instead of absorbing energy, glasshouses can generate energy. The same principle is applied in the Bouwen met Groen en Glas project. But here, other factors play a part too. Like the quality of the indoor climate for people using or living in these buildings and the lower building costs. The project has gained momentum and things are now moving fast.

‘The techniques for making the best possible use of light and heat have advanced rapidly with truly astounding results’, says Oei, when asked if glass is a major cause of heat loss in buildings compared to insulated cavity walls. The insulating properties of glass have improved. U–Values, or the amount of heat lost through one square meter of glass for every degree difference in temperature, have lowered significantly from 5.8 for single pane windows to 1.2 for coated glazing.

Also, heat exchangers, thermal buffers and screens are used to regulate the indoor climate. The incoming heat is used down to the last calorie. This allows the creation of a climate in which plants can thrive. This concept is being applied in the Bouwen met Groen en Glas projects. Plants indoors will absorb the harmful substances, filter airborne particles, regulate humidity levels and reduce heat. ‘If you weigh the costs and benefits of this approach to building you should also look at the benefits for the people living and working there: their sense of well-being is enhanced by being in a

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green environment and in an agreeable climate.

The pros and cons can also be approached in a different way,’ Oei says. ‘It is much cheaper using glass as a building material. Not only that, but building under glass also has advantages. The timber used indoors need not be painted or treated. And open spaces are dealt with differently. Corridors and stairwells need no longer be inside the building, they can be placed along the side in light glass-covered spaces or in glass by-passes where temperatures need not be regulated so carefully as inside. They may be anything between 17 and 23 degrees. And putting these routes along the outside allows for a smaller more compact core of the building. And so it will be cheaper because the building costs per square metre are much lower for glass than for brick or stone.’

Last year the third extended edition of the book on greenery and glass projects was published, with examples in the residential, school, health care and trade and industry sector. The book* has now been translated into English, French and German. Oei is quite pleased. ‘In the space of two years, 3,000 copies of the book have been provided to architects and people in the building trade. This concept clearly has a future!’

* Alexander van de Beek en Huub ter Haar: Bouwen met Groen en Glas in Uitvoering; Boxtel, Uitgeverij Aeneas, 2009; ISBN 978-90-75365-94-8.

New housing for Greta 21

If a cow could design its own housing, what

would it look like? A group of innovative

Dutch farmers and dairy farms have

cooperated to tackle this question. Their

answer: cows want fields under a roof –

and now we can build them.

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For the past three decades, cubicle housing has been the preferred system in the dairy cattle sector, combining separate stalls with free roaming areas. While the system still meets today’s needs, sustainability is a new factor for consideration. So, can cubicle housing be modernised and improved for cows, the environment and farmers? Courage, a foundation associated with the NZO national dairy organisation, and LTO Nederland, the Dutch Federation for Agriculture and Horticulture, stimulate innovation in Dutch agriculture by putting ideas into practice. Together with the Dutch Ministry of Agriculture, Nature and Food Quality and Wageningen Universiteit and Research Centre, the Federation carries out relevant research.

‘We asked scientists to define the biological needs of cows and the extent to which cattle housing meets these needs’, explains Carel de Vries, project leader at Courage. ‘Cows are happy where they are now. They have water, fresh air, light, and food. But if you were to let a cow choose between a stable and a field, it would take the field where it has more room, where it can choose the animals it can lie down with and where the soil is comfor-table and soft.’ Courage therefore studied loose housing systems, without cubicles, where cows can roam freely on soft flooring. A number of these systems have already been built in Israel and the United States, but they may prove unsuitable in the damp Dutch climate. Aside from hygiene problems, cows do not like floors to be damp from urine and excrement.De Vries: ‘One of the key questions is how to keep the surface dry. Compost barns may provide an alternative.’ In compost barns, the bacteria that grow during composting produce heat and keep the floor warm and dry. The composting process starts by regularly turning the excrement on the floor with sawdust or straw. The floor’s dry and warm top layer provides a pleasant underground for the cows, and benefits their health, as it reduces the spread of diseases, including the bacteria that cause mastitis.

Courage commissioned Wageningen University to study how much litter or straw was needed to continue the composting process and produce enough heat to keep the stables dry. The study group also looked at costs, and how much labour it involved. ‘Our concern is not just the cow’s welfare. We also look for environmental solutions that will benefit the farmers. After all, innovation should not lead to problems elsewhere. Plastic flooring could be an option, combined with a manure removal machine. Such soft, comfor-table floors might be easier to clean.’

Courage also designed a luxury loose stable, the so-called cattle garden. This

design should not only keep cows happy, but also benefits local residents. The cattle garden offers cows shelter under trees, shrubs and in secluded areas. De Vries: ‘People spend fortunes to see animals in a zoo. We talked with zoo architects about how they create viewing areas that appeal to visitors. With this in mind we designed an area that is perfect for your Sunday afternoon stroll. And while it is still a production area, it doesn’t look it. The biggest benefit is public appreciation, which is needed for businesses operating in Holland’s densely populated areas.’‘We know the loose stables concept appeals to farmers. They are keen to solve leg and foot problems from which their animals suffer. I am certain it will succeed. Loose stables will replace cubicle housing in the future. The first Dutch compost barn is now up and running. Over the coming years we will see an increase in these stables operated by pioneers. It is the next logical step.’

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1 The Netherlands

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1.1 Area and population

The Netherlands is one of the smallest countries in the European Union. More than half of its total surface area of over four million hectares is used for agricultural purposes, nearly one-fifth is water, and 12% is forested or open, natural terrain.

Nearly 25% of the population of 16.5 million inhabitants is younger than 20. Life expectancy at birth is 78 years for men and 82 years for women. With an average of 488 inhabitants per square kilometre, the Netherlands is one of the most densely populated countries in the world. A little over two-fifths of the people live in highly urbanised areas, with one-fifth in non-urban areas. The biggest city is the capital Amsterdam, with 750,000 residents, followed by Rotterdam and The Hague with 580,000 and 476,000 inhabitants, respectively. One-fifth of the total population has roots outside the country, with one-half of this group being of non-Western descent. Within this group, the majority is of Turkish descent, followed by Surinamese and Moroccan.

1.2 Political structure and government

The Netherlands is a constitutional monarchy, with Queen Beatrix as current Head of State. The form of government is a parliamentary democracy with a bicameral legislature. The 150 members of the House of Representatives are chosen by general election, and the 75 members of the Senate are chosen indirectly by Provincial Councils, the legislatures, of sorts, of the 12 Dutch provinces.

Agriculture has to work with government, but it also has to deal with regulatory industrial organisations, made up of representatives of employer associations and unions in a specific sector. These organisations can issue binding instructions for the relevant product group, not only for primary production, but also for supply, trade, and processing. Examples are the Higher Commodity Board for Arable Farming, the Product Board for Horticulture, the Dutch Dairy Commodity Board, and the Product Boards for Livestock, Meat and Eggs.

The Netherlands has a long history of working towards international cooperation. It was one of the six original countries to found the European Union in the 1950s.

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1.3 Economy

The Netherlands is one of the world’s wealthiest nations, a country which excels at trade and boasts high-quality financial and professional services. The economy is internationally-oriented, and after the U.S. and France, the Netherlands is the third largest exporter of agricultural products. The country’s good transport infrastructure makes this possible. The Port of Rotterdam is the largest in Europe and second largest in the world in terms of cargo transfer, making the Netherlands a major transit country for all sorts of goods.

Labour productivity is high and the investment climate is good. It is therefore not surprising that many international companies are based in the Netherlands. The Gross Domestic Product (GDP) was over 594 billion EUR in 2008. The global recession is expected to cause a decrease of 3.5% in 2009 and 0.25% in 2010; this is slightly more than for the Euro countries as a whole.

1.4 Agricultural sector

In 2007, the agricultural-industrial complex (i.e. agriculture, horticulture, and associated products and services), with almost 48 billion EUR, represented nearly 10% of the Dutch economy, measured in added value. This was slightly less than in 2001. Although the added value of the agri-complex had increased by 18% since that year, the entire economy had also grown, and by 25%. At the same time, employment in the sector dropped by 6% (45,000 labour years), while total employment grew by nearly 2%.

Key figures for the Dutch agri-complex, 2001 and 2007

Added value(factor costs, in billions of EUR)

Employement(in thousands of

labour years)

2001 2007 (r) 2001 2007 (r)

a) Landscaping, farm services, and forestry 3.7 4.0 75 64

Proportion of national total 0.9% 0.8% 1.1% 0.9%

b) Foreign raw materials 15.3 18.3 226 218


- Processing 6.6 7.7 73 65

- Supply 4.0 4.9 69 69

- Distribution 4.7 5.6 84 84

c) Domestic raw materials 21.5 25.6 416 390


- Primary production 7.6 8.0 184 169

- Processing 3.2 4.4 50 42

- Supply 8.1 9.9 137 130

- Distribution 2.6 3.2 45 50

Agri-complex, proportion of national total (a+b+c)

40.5 47.9 717 672


Source: Agricultural input-output table, adapted by LEI.

37

38

1.5 Dutch Household consumption

The Netherlands has 7.3 million house-holds. One-third of these are single-person households, but on average, a household in the Netherlands contains 2.22 persons. Each household spends an average of 14% of its collective income on food, beverages, and tobacco. In 2007, the Netherlands spent a total of 36.5 billion EUR on food, beverages, and tobacco. The largest expenditures were for meat and fish (5.7 billion EUR), followed by tobacco (3.7 billion), beverages (3.5 billion), dairy (3.4 billion), fruits, vegetables, and potatoes (2.5 billion).

Some facts about the Netherlands and the agricultural sector (2008)

• The Netherlands comprises 0.008% of the world’s surface area

• The country’s surface area totals 4,152,795 hectares, 25% of which is below sea level, and 2,303,074 hectares is agricultural land

• The country has 16.4 million inhabitants and a labour force of 7.7 million

• Life expectancy at birth: 78.0 years for men, 82.3 years for women

• Gross Domestic Product: 594 billion EUR• Per capita income: 30,133 EUR• Inflation: 2.5%• Unemployment: 3.9%• Less than 3.5% of the labour force works in

agriculture, horticulture, or fisheries• The Netherlands is one of the founders of the

EU and one of the driving forces behind European policy for food quality

• The Netherlands is one of the three largest exporters of agricultural products

• The Netherlands is a centre for international trade in ornamental plants

• The world’s first horticultural auction opened in the Netherlands in 1887

• The Netherlands is the largest supplier of potatoes and potato products to the European market

• Average milk production for a Holstein Friesian cow is 8,750 kg at 4.26% fat and 3.44% protein

• Dutch livestock totals (commercial farms): 3,890,000 head of cattle, including

1,466,000 dairy cows 144,078 horses and ponies 1,213,000 sheep 355,000 goats 12,026,000 pigs 96,700,000 chickens, including 44,358,000

broilers and 44,241,000 laying hens 1,044,000 turkeys for meat production

2 Agricultural trade

40

2.1 Development

The Dutch economy is internationally-oriented and the agricultural sector is no different. The Netherlands exported agricultural products worth 65 billion EUR in 2008, which account for 17.5% of the total Dutch exports that year. Agricultural exports go largely to other EU Member States. Agricultural imports to the Netherlands are also sizable: 41 billion EUR in 2008, for nearly one-eighth of total imports.

Only the U.S. exported more in 2008 than the Netherlands. The U.S. show exports of 79 billion EUR in 2008, with the Netherlands at 54.7 billion EUR. Germany is third, at 50 billion EUR in agricultural exports.

2000 2007

Total 376 769

United States 49.3 78.7

The Netherlands 24.8 54.7

Germany 19.9 50.0

France 27.7 49.6

Brazil 10.4 35.2

Canada 20.9 31.3

Belgium 14.0 29.8

China 12.4 28.9

Spain 12.3 27.4

Italy 12.2 25.8

Source: ITC/WTO

2000 2007

Total 398.9 773.2

United States 49.8 81.7

Germany 29.3 59.8

Japan 45.8 51.4

United Kingdom 23.4 48.0

France 21.2 41.5

China 11.2 39.3

Italy 20.6 38.5

The Netherlands 14.9 33.2

Spain 12.3 29.0

Belgium 13.5 28.9

Source: ITC/WTO

Global exports of agricultural products (in billions of EUR)

Global imports of agricultural products (in billions of EUR)

41

42

2.2 Composition

Dutch agricultural trade is diverse. In 2008, nearly 8 billion EUR in orna-mentals and other plants were exported, nearly 7 billion in meat and meat products, and more than 6 billion in eggs and dairy products. Of the considerable amount imported, meat, dairy, fruits and vegetables, grain, and cocoa and cocoa preparations represented the largest shares.

EU The Netherlands

(in billions of EUR)


(share of EU totals, in %)

Total, agricultural products including: 382.5 64.5 16.9

Meat and meat preparations 34.7 6.9 19.9

Eggs and dairy products 33.4 6.1 18.3

Fruits and vegetables 36.2 10.0 27.6

Ornamentals and other plants 10.9 7.8 71.6

Tobacco and tobacco products 14.8 3.0 20.3

Other products 252.5 30.7 12.2

Source: Eurostat

EU The Netherlands



(share of EU totals, in %)

Total, agricultural products including: 399.2 40.9 10.2

Meat and meat preparations 31.0 3.4 11.0

Eggs and dairy products 27.2 2.7 9.9

Grain 17.2 2.4 14.0

Fish and fish products 23.7 1.7 7.2

Fruits and vegetables 48.7 5.5 11.3

Cocoa and cocoa preparations 13.5 2.0 14.9

Other products 237.9 23.2 9.8

Source: Eurostat

EU exports of agricultural products (incl. intra-community trade), 2008

EU imports of agricultural products (incl. intra-community trade), 2008

44

2.3 Trading partners

More than 80% of Dutch exports go to the EU. True to tradition, Germany remained the most important trading partner for the Netherlands in 2008, also for agricultural products. More than 16 billion EUR in agricultural products were exported to Germany -- more than 25% of the total agricultural exports of the Netherlands.

25.5

25.5

Share (in %)

Value (in billions of EUR)

Partner country

United Kingdom

Belgium

France

Italy

Spain

Poland

Sweden

Denmark

Greece

Austria

Ireland

Other EU countries

Total EU countries

United States

Russia

Switserland

Japan

Norway

Saudi Arabia

China

Other non-EU countries

Total, other non-EU countries

11.0

10.7

9.9

5.8

3.3

2.0

2.0

1.9

1.4

1.3

1.2

5.4

81.4

25.5

Germany 25.5 16.444

World 100.0 64.479

7.125

6.895

6.413

3.769

2.159

1.316

1.295

1.238

0.912

0.860

0.767

3.439

52.631

16.4442.7

2.3

1.1

0.8

0.7

0.5

0.5

10.0

18.6

1.720

1.469

0.699

0.512

0.462

0.339

0.331

6.316

11.848

Dutch exports of agricultural products (by destination country), 2008

Source: Statistics Netherlands (CBS)

45

The Netherlands, in turn, had a share of nearly 25% in Germany’s imported agricultural products. And for Germany, the Netherlands is the most impor-tant country in terms of Germany’s own agricultural exports; in 2008, for example, Germany exported more than 7.5 billion EUR in agricultural products to the Netherlands.

After Germany, the Netherlands’ most important trading partners are Belgium, France and the UK. And in France and Italy, the Netherlands had a considerable share of the agricultural imports, at 10% and 8%, respectively.

25.5

25.5

13.2

3.5

9.3

3.1

3.9

2.6

3.3

2.0

2.2

1.7

1.8

1.5

1.4

0.8

1.1

0.8

4.6

60.8

20.0

6.7 2.744

Argentina

United States

Malaysia

Indonesia

China

South Africa

Thailand

India

Brazil

Belgium

France

United Kingdom

Spain

Italy

Poland

Denmark

Ireland

Other EU countries

Total EU countries

Germany

World100.0

1.429

1.263

1.065

0.821

0.695

0.612

0.318

0.308

0.6 Turkey0.253

8.192

40.903

5.406

3.786

1.577

1.356

0.894

0.720

0.577

0.448

1.887

24.842

15.9

39.2

Other non-EU countries

Total non-EU countries

6.552

16.060

Dutch imports of agricultural products (by country of origin), 2008

Share (in %)

Value (in billions of EUR)

Partner country

Source: Statistics Netherlands (CBS)

Dutch exports to EU countries (by product group), 2008

Ornamentals and other plants

Meat

Dairy

Vegetables

Livestock feed

Preparations made from fruits, vegetables, or potatoes

Fruits, nuts, and spices

Tobacco

Processed grain, starch

Fish

Other

Total

6.539

6.309

3.777

3.689

3.480

3.316

2.919

2.825

2.327

1.844

15.606

52.631

Product group Value (in billions of EUR)

Source: CBS

Dutch exports to non-EU countries, 2008

Beverages

Dairy


Coffee, tea, cocoa


Meat

Vegetables

Livestock feed

Fish

Fruits, nuts and spices

Oils, fats, and margarine

Seeds


Other

Total

1.538

1.467

1.340

0.911

0.840

0.622

0.564

0.458

0.457

0.399

0.383

0.356

0.314

2.199

11.848


Source: CBS

Dutch imports from EU countries, 2008

Meat

Dairy

Grain, seeds, legumes, potatoes

Beverages



Livestock feed



Wood, cork

Vegetables

Fish

Oilseeds

Other

Total

2.677

2.459

2.295

1.842

1.620

1.293

1.256

1.248

1.173

1.162

0.898

0.825

0.818

5.276

24.842


Source: CBS

Dutch imports from non-EU countries, 2008



Oilseeds

Livestock feed

Coffee, tea, cocoa

Fish


Meat


Wood, cork

Other

Total, non-EU countries

2.641

2.202

1.678

1.546

1.479

0.911

0.836

0.799

0.748

0.597

2.623

16.060


Source: CBS

3 Developments in the agricultural sector

48

3.1 Agricultural and horticultural operations

3.1.1 Number of businessesA slight expansion and intensification of production rising productivity, restructing of farms – this is the trend in Dutch agriculture and horticulture over the last few decades. Between 1990 and 2008, the number of businesses shrank by 40%, the result of a process that has been present for years, but which accelerated after 1995. The remaining farms take over the production and increase in scale. This proces is largely brought on by the high cost of labour.

This trend is most evident in greenhouse horticulture, with 40% fewer businesses since the year 2000. Related phenomena include stiff competition at horticultural markets, the steep increases in energy costs, and the restructuring of a number of horticultural areas. At the same time, long-term production trends are rising.

Livestock, 2008

49

HORSES AND PONIES 16.100 144,000 9

GOATS4.2.000355,00085

SHEEP13.60001,213,00089

CATTLE34.20003,890,000114

PIGS8.2.00012,026,0001,458

CHICKENS2.500096,700,00038,742

number of businessesnumber of animalsavg. number of animals per business

Source: CBS and LEI

50

Number of businesses

Total surface area (in

hectares)

Avg. surface area per

business(in hectares)

Vegetables 2,022 4,647 2.3

Cut flowers and plants 4,004 5,047 1.3

Mushrooms 214 77.1553 0.3605

Source: CBS and LEI


Total surface area

(in hectares)



Vegetables 3,051 24,857 8.1

Fruits 2,325 17,771 7.6

Flower bulbs 2,497 24,330 9.7

Trees 1,451 2,581 1.8

Source: CBS and LEI

Greenhouse cultivation, 2008

Open field horticulture, 2008


Total surface area

(in hectares)



Grain 17,128 243,490 14.2

Legumes 505 2,450 4.9

Cash crops 1,590 10,090 6.3

Grass seed 1,911 15,650 8.2

Potatoes for consumption 8,019 105,800 13.2

Starch potatoes 1,741 46,030 26.4

Sugar beets 11,694 82,027 7.0

Onion seedlings 2,861 20,300 7.1

Fodder maize 27,818 241,730 8.7

Source: CBS and LEI

Arable farming, 2008

51

In 2008, 75,000 businesses were active in the sector: 25% with dairy cattle; 25% with “other grazers”, such as beef cattle, sheep, and goats; 11,000 specialised farming operations, producing mainly grain, sugar beets, and potatoes; more than 13,000 produce horticultural crops, either in open fields or in greenhouses; another 6,500 are intensive livestock operations raising pigs or poultry; and a group just as large combines these different categories of production.

3.1.2 FarmlandThe Netherlands has a total land surface of 4.15 million hectares. Just over half is farmland, representing 1% of all farmland in the EU. Of the farmland in the Netherlands, 56% is used for arable and horticultural crops, 42% is permanent grassland, and 2% is used for permanent crops.

3.1.3 The environmentA study by the Organisation for Economic Co-operation and Development (OECD) shows that the pressure exerted by Dutch agriculture and horticulture on the environment has declined relatively sharply, in comparison with other OECD countries, and also compares favourably within the EU. Between 1990 and 2004, levels of excess nitrogen per hectare decreased by one-third, and phosphorus by one-half. Ammonia emissions dropped by nearly one-half.

3.1.4 Production valueIn 2008, agriculture and horticulture in the Netherlands had a production value of 24 billion EUR, or 1.6% of the Gross Domestic Product. This is higher than the EU average of 1.2% of GDP. Of the total production value, 11.4 billion EUR was generated by arable and horticulture crops and 9.7 billion from livestock products. Of the value of arable and horticulture crops, more than half was from flowers and plants. Of the livestock products, dairy has the largest share, at 43%. The production value rises with 21% since 2000 in nominal terms (corrected

3.1.5 ProductivityThere are fewer, larger businesses in agriculture and horticulture today, primarily as a result of rising costs of labour combined with the availability of labour-saving devices. And in the last few decades, crop yields have gone up sharply. For example, winter wheat yields rose from 5100 kg per hectare in 1975 to 9000 kg in 2008. Sugar beets increased from 44 to 72 tonnes, potatoes from 33 to 46 tonnes. The dairy sector shows a similar trend, with annual production jumping from 4625 kg per cow in 1975 to 7879 kg in 2007.

3.1.6 Organic agricultureIn 2008, more than 5000 hectares were being organically farmed by 1400 certified businesses. At 36.2 hectares, the average organic farming business is 40% larger than the average non-organic business. Over two-thirds of the total surface area of the land used by organic farms is pasture for grazing livestock. More than 10% of the surface area is used to cultivate fruits, vegetables, and potatoes, with another 10% for grain. Smaller areas are used for fodder and other crops. Nearly 740 hectares lie fallow.

In the Netherlands, organic farming uses 2.6% of the farmland. When EU countries are ranked according to their total area of organic farmland, the Netherlands appears somewhere about halfway down the list. Italy leads, with 1.2 million hectares of organic farmland, 9 % of the country’s total farmland, followed by Spain, with 1 million or 3.9%, and then Germany, with 0.9 million, or 5.1%.

Of the organic fruits, vegetables, dairy, beef, poultry, cheese, and eggs produced in the Netherlands, more than half is exported, primarily to Germany, the UK, Belgium and France.

3.1.7 Regional products Although the market for regional products is limited – estimates range from 120 to 180 million EUR – interest in them is increasing. Since 1992, regional products can receive a protected designation of origin or a geographical indication from the European Union. Of the 740 products registered, 1% come from the Netherlands, including the Westlandse druif, the Opperdoezer Ronde potato, and the following cheeses: Noord-Hollandse Gouda, Noord-Hollandse Edammer, Boeren-Leidse met sleutels, Kanterkaas varieties, and Boerenkaas.

3.2 Fisheries

The Dutch fisheries sector has garnered considerable interest in recent years. Non-governmental organisations have accused the sector of overfishing and disturbing the marine ecosystem. The amount of fish each Member State can catch is determined at the European level on the basis of recommendations from the International Council for the Exploration of the Sea (ICES). Although the sector makes only a limited contribution to the Gross Domestic Product, the Dutch fishing fleet is the most efficient in Europe, and probably even the world. Dutch fishing operations catch the

52

53

Total production value including: 19,923 24,013

ARABLE CROPS 1,767 2,090

Grain 237 289

Potatoes 645 1.011

Sugar beets 303 203

Industrial crops 61 63

Fodder crops 522 523

HORTICULTURE CROPS 7,860 9,342

Vegetables (fresh) 1,952 2,052

Fruits (fresh) 322 639

Plants and flowers 5,105 6,203

Other crops 480 448

LIVESTOCK PRODUCTS 8,581 9,711

Cattle 1,250 1,503

Pigs 2,336 2,563

Horses 36 16

Sheep and goats 120 155

Poultry 685 729

Other animals 14 19

Milk 3,664 4,192

Eggs 402 414

Other animal products 74 121

Agricultural services 1,244 2,577

Other goods and services 95 293

2000 2008

Source: CBS

53

54

greater part of the European quotas for sole and a substantial part of the total allowable catch for plaice, herring, and horse mackerel.

The EU and the Dutch government support the fisheries in working towards a more innovative and sustainable sector. The aim is to bring fish populations up to biologically safe levels and to ensure the continuing viability of fisheries, aquaculture, and the fish processing industry. Million of Euros have been earmarked for this purpose, both at the national and European level.

By the end of 2005, the Dutch fisheries fleet consisted of 441 vessels and 2274 crew. The cutter fleet, which primarily involves family businesses operating on the North Sea, is the single largest group with its 342 vessels and 1470 crew. The distant-waters fleet consists of 15 large deepfreeze trawlers up to 145 meters long. These vessels are operated by a shipping company to fish for pelagic species such as herring, mackerel, horse mackerel, and blue whiting in European, African, and South American

SolePlaiceCodHerring

North Sea Western waters

Main fish quotas (in thousands of kg), 2009

MackerelHorse mackerelBlue whiting

2,76211.6

31,069

25.6

10,466

75.2

20,237

38.5

13,787

18.6

57,415

34.6

28,905

9.3

Source: Ministry of Agriculture, Nature and Food Quality (LNV)

Percentage of total allowable catch

55

waters. The European Commission negotiates with African countries, such as Mauritania, about the catches allowed in their waters. The trawlers employed 560 crew in 2005. In addition to the cutter fisheries and the distant-water fisheries, the Dutch fisheries sector includes mussel and oyster fisheries. This shellfish sector has around 85 vessels and employs some 250 people.

3.3 Food, drinks, and tobacco industry

3.3.1 Companies, employees, sales volumesThe food, beverage, and tobacco sector is an important Dutch industry. With its 4500 businesses and 150,000 employees, the sector generated nearly 57 billion EUR in net turnover in 2006. Mergers and concentrations have led to a steady decline in the number of businesses in the sector. They represent the sector’s response to the strengthened position of retailers,

345 1404 270

14 508 134

56 170 66

27 50 6

442 2132 476

Source: LEI

Number of vessels

Number of crew

Yield (in millions of EUR)

Cutters

Distant-waters fleet

Mussel fisheries

Other coastal fisheries

Total sea and coastal fisheries

The Dutch fisheries fleet, 2007

56

who have pooled their purchasing power at the national or European level.

Businesses in the food, beverage, and tobacco industry are often subsidia-ries of multinationals and thus internationally oriented. Nearly half of the sector’s sales are generated abroad, 75% of this amount in other EU Member States. Foreign investment is also high, totalling 31.6 billion EUR in 2007, with more than half going to the EU, especially Belgium and the UK. Likewise, foreign firms invested over 45.5 billion EUR in Dutch food companies. The U.S. was the biggest investor, with more than half of the total investments, followed by France, with nearly 14 billion EUR.

3.3.2 Multinationals and investments in the Dutch food, drinks and tobacco industryThe Netherlands is home to numerous multinationals, some of which occupy top positions on several continents with their products. The top eight Dutch food corporations had global sales of nearly 85 billion EUR in 2008. Unilever and the Swiss corporation Nestlé are the world’s most important manufacturers of food. In 2008, Unilever had global sales of over 40 billion EUR, with more than half from food and beverages. The multinational had 174,000 employees in a hundred countries, including 30,000 in Western Europe, 42,000 in North and South America, and over 100,000 in Asia and Africa combined.Heineken, with a consolidated beer volume for 2008 of 126 million hectolitres, and 125 breweries in more than 70 countries, is the biggest brewer in Europe and one of the biggest in the world. Heineken holds the top position in many of the countries in which it operates. In the Netherlands, Heineken has a market share of 50%.

The VION Food Group has production and sales operations world wide. Main divisions are Food and Ingredients. The Food Division comprises fresh pork, beef, lamb, and chicken, along with convenience food derived from these meats. The Ingredients Division comprises animal-based ingredients. VION has a market share in Europe of 5% for beef products and 9% for pork products.

Royal FrieslandCampina, with its 21,000 employees and 2008 sales of 9.5 billion EUR, is the third largest dairy company in Europe, behind the Swiss firm Nestlé and the French firm Danone. FrieslandCampina, a dairy farmer cooperative, has some hundred production and sales operations in 25 countries and processed nearly 11.5 million kg of milk in 2008.

57

Nutreco’s sales make it one of the top three animal feed producers in the world, with a share of 1.3% in a fragmented market. The company has over 9000 employees in 30 countries and sells its products in 80.

CSM is active in bakery ingredients, bakery products, lactic acid, and lactic acid derivatives. CSM leads the world market for the latter products. For bakery ingredients and products, CSM occupies the top market position in Europe and the second position in the U.S.

The increasing integration of the Dutch food, drinks and tobacco industry into international markets raises the question of how strong the bond of these markets is with the Netherlands. The breakdown into domestic and third country suppliers suggests that production facilities in third countries could easily be transferred to other regions if this would yield competitive advantage. However, it is not that simple. Businesses using domestic raw materials may have reason to expand or move their production processes, for example to eastern Europe. On the other hand, the port facilities, areas of consumption and other historic support activities developed in north-western Europe may bind the industry to the Netherlands.The analysis of foreign direct investment in the chart below shows the central role played by the Netherlands.

Added value (factor costs, € thousand million

Employment (1,000 man-years)

Food, drinks and tobacco industry (a) 2001 2007 2001 2007

Food, drinks and tobacco industry (a) 9.8 12.1 123 107

based on domestic raw materials 3.2 4.4 50 42

based on raw materials from abroad 6.6 7.7 73 65

Supply and primary production (b) 19.7 22.8 390 368

Primary production 7.6 8.0 184 169

Distribution(c) 7.3 8.8 129 134

Horticulturalists, Agricultural services, forestry (d) 3.7 4.0 75 64

Agri-complex (a+b+c+d) 40.5 47.9 717 672

Share of national total 10.2% 9.6% 10.8% 9.9%

Source: Nederlandse Bank. These figures may vary from data published earlier due to revisions by national accounts and methodological changes. Bron: Agricultural Economics Research Institute

Analysis of foreign direct investment

Foreign investment in the Dutch food, drinks and tobacco industry. Direct investment from foreign companies in the Dutch food, drinks and tobacco industry amounted to more than EUR 33.6 thousand million in 2006 and EUR 45.5 thousand million in 2007, representing a growth of 34% between 2006 and 2007. Most of this investment was made to get a share in the running of Dutch food, drinks and tobacco businesses and came mainly from the US (LEB 2008). US investment in 2006 was EU 22.1 thousand million compared to EU 23.3 thousand million in 2005. In 2007 half of foreign investment, amounting to EUR 22.8 thousand million, came from US businesses.

In 2006, the UK with almost EUR 3.2 thousand million was the most important investor within the EU, followed by France with EUR 1.6 thousand million (LEB 2008). In 2007 France was the largest investor with EUR 13.8 million. This investment was made almost entirely by the dairy conglome-rate Groupe Danone, which in 2007 took over Koninklijke Numico for more

58

FOOD, BEVERAGES, AND TOBACCO 2000 2002 2006

Number of businesses 5070 169,000 50.018

Number of employees 4825 163,000 52.796

Net turmover (in billions of EUR) 4520 152,300 56.792

TOTAL SECTOR 2000 2002 2006

Number of businesses 45,290 966,600 229.188

Number of employees 46,305 925,600 223.425

Net turmover (in billions of EUR) 46,605 846,800 280.922

Source: CBS

The industry in The Netherlands, 2000-2006

59

than EUR 12 thousand million (LEB 2009).

Investment abroad by the Dutch food, drinks and tobacco industry Dutch business investment in the food, drinks and tobacco industry abroad amounted to EUR 31.6 thousand million in 2007, against EUR 17 thousand million in 1997. More than half of this investment, 54%, was in the EU. Belgium and the UK were the most important, followed by Germany, France, Italy and Spain. Outside the EU, Dutch businesses invested mainly in the US, Central and South America and Switzerland. In 2006 Dutch businesses invested more than EUR 6.7 thousand million in the US. It is mostly the large Dutch multinationals that have developed large interests and generate a large part of their turnover there (LEB 2008; 2009).

According to a 2006 OECD study into trends in foreign direct investment in OECD countries, the Netherlands is in fourth place behind the US, the UK and France, followed by Canada, Belgium and Germany. For direct investment in

MULTINATIONALS Global sales(in billions of EUR)

Dutch sales(in millions of EUR)

Number of employees

Product group

Unilever 40.5 (not available) 174,000 Food and beverage products

Heineken 14.3 (not available) 56,200 Beverages

VION Food Group 9.6 (not available) 35,000 Meat, ingredients, etc.

FrieslandCampina 9.5 2798 20,600 Dairy products

Nutreco 4.9 833 9200 Animal feed, fish food, meat

CSM 2.6 154 8400 Bakery ingredients and

lactic acid

Cosun 1.7 (not available) 4300 Food and ingredients

Wessanen 1.7 169 5800 Natural foods and snacks

Top Dutch food corporations, 2008

Source: Company web sites and annual reports

60

foreign countries the Netherlands is in the top five alongside the US, Japan, the UK and France.

3.3.3 Retailers and the hospitality industry In 2007, Dutch consumers spent 36.5 billion EUR or 14% of their collective income on food, beverages, and tobacco. Four-fifths of the money spent on food, and two-thirds of that spent on alcohol and tobacco went to super-markets – the primary outlet for daily purchases. Most Dutch supermarkets belong to a relatively small number of chains. Albert Heijn is the largest of these, with 750 stores, 2008 sales of 9 billion EUR, and a market share of nearly one-third. Albert Heijn is a subsidiary of the Ahold Group, the third largest supermarket chain in the world. Wholesalers Schuitema, owner of the C1000 supermarkets, has a market share of almost 13%, the German discount food retailer Aldi about 9%, and Super de Boer 7%.Food Away From Home (FAFH) expenditures amounted to 14 billion EUR for Dutch consumers in 2007. The hospitality industry, which includes hotels, restaurants, snack bars, fast food establishments, cafés, cafeterias and

Number of stores Number of employees Sales (in millions of EUR)

Supermarkets 5740 221,500 26,700

Specialty shops:

- Greengrocers 1440 5200 465

- Butchers 2420 14,100 1200

- Poultry shops 245 900 82

- Fishmongers 890 2800 211

- Chocolate and confectionery shops 580 1200 66

Liquor stores 2221 4300 920

Tobacconists 1700 2700 .

Cheese shops 520 1500 162

Bakeries 4190 41,000 .

Natural food stores 370 2000 168

Source: CBS

Retail trade in food, beverages, and tobacco in the Netherlands, 2007

Source: Central Industry Board for Retail Trades (www.hbd.nl)

61

catering, counts some 42,000 businesses and employs 340,000 people. One-fourth of the businesses are restaurants, one-fourth cafés. The recent economic crisis has put pressure on the food budgets of individuals and companies alike.

3.3.4 OrganicIn 2008, Dutch consumers spent 583 million EUR on organic products, a 2% share of all food, beverage, and tobacco products. There are many sales outlets, and most registered a growth in sales in 2008. Supermarkets generated more than 11% growth, with total sales of 257 million EUR, largely by expanding their selection of products. Specialty shop sales grew by nearly 9%, to 235 million EUR. Contract catering sales doubled in 2008, to nearly 46.1 million EUR. Many new contracts require the selection of organic items be expanded.

4 Research and education

62

63

The agricultural sector is vital to the Dutch economy and Dutch culture. Over the years, a knowledge infrastructure has been put in place that continually evolves and develops, thus ensuring the sector continues to thrive. The center of this knowledge infrastructure is Wageningen University and Research Center (Wageningen UR), where the greater part of fundamental and applied research takes place. The Top Institute Food and Nutrition (TIFN) – a public-private partnership involving government, research institutes, and companies such as CSM, DSM, VION, Unilever and FrieslandCampina – is also located in Wageningen.

A number of agri-food businesses have concentrated their research activities around Wageningen, but relevant research and education also takes place in other locations: the University of Maastricht (NUTRIM), the University of Groningen, the University of Leiden, the Erasmus University in Rotterdam and the Technical Universities of Eindhoven and Delft. Other research institutes in the areas of food and agriculture are TNO, National Institute of Public Health and Environmental Protection (RIVM), and NIZO Food Research.

In the coming years, a development towards more innovative food products is expected, such as functional foods, which are foods with added health-enhancing value. The Netherlands has a good knowledge infrastructure in the area of functional foods and nutraceuticals.

Wageningen University and the Van Hall Larenstein College of Higher Education have a strong international element, with students from over 100 countries. Wageningen International plays a key role in the international activities of Wageningen UR, functioning as a worldwide front office that responds to questions about education and research, and offers courses and tailored research.

SUPERVISORY BOARD

BOARD OF GOVENORS

WAGENINGEN UNIVERSITY

Agrotechnology & Food Sciences

Animal Sciences Environmental Sciences

SPECIALIZED RESEARCH INSTITUTES

Restaurant of the future

Infectious animaldiseases

Alterra

Food Technology centre

Livestockmanagement

Quality in chains

Biobased Products

Products

Agrotechnology & Food Science Group

Animal Sciences Group Environmental Sciences Group

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Plant Sciences

Social Sciences

Plant ResearchInternational

Agricultural EconomicsResearch Institute (LEI)

Practical ResearchInternational

Practical ResearchPlant and Environment

Plant Sciences Group Social Sciences Group Hogeschool Van Hall Larenstein

Wageningen International

Wageningen IMARES

Wageningen BusinessSchool

Wageningen BusinessGenerator

Statutory Research

Central Institute forAnimal Disease Control (CIDC, Lelystad)

Institute of Food Safety(RIKILT)

4 Statutory research programmes

Van Hall Larenstein

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5 Public policy

66

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The Dutch Minister of Agriculture, Nature and Food Quality has confidence in the future of the agri-sector and in entrepreneurship as its determining factor. The agricultural sector is a key contributor to the economy and to the liveability of the countryside. The ministry’s agriculture policy aims for sustainable development, where a balance is continually sought between the three dimensions of socially responsible enterprise: People, Planet, and Profit.

The Ministry is faced with major changes in society that have an impact on its policy areas. The use of green spaces and their function for the population’s well-being, for example, remains an important issue. Food safety and the environment are high on the agenda. Global developments such as the food crisis, the tension between producing food or fuel, the protection of biodiver-sity, and the reduction of our ecological footprint, all have an important place in policy. These developments call for adaptations to be made in several sectors and production chains, such as intensive livestock production, greenhouse horticulture, and dairy farming. The government encourages the adaptations required, and asks the sectors themselves to take their share of the responsibi-lity. At the same time, the Ministry emphasises the role of the agricultural sector in resolving issues of ecology, climate, and animal welfare.

Key elements in the government’s agriculture policy:

Sound, sustainable agriculture: meets the demands and requirements of society, strives to be varied and multifunctional, contributes to spatial quality, is internationally competitive;

Food quality: produce sound, wholesome and safe food, which meets a wide range of consumer demands and is the result of well-functioning business chains, stimulate innovation in food quality and transparency in international food chains;

Knowledge and innovation: develop a knowledge infrastructure that can address challenges, for instance through the government-initiated Innovation Platform or by further funding innovation and expertise;

International context: facilitate international trade, limit informal transaction costs, and promote sustainable development. The Netherlands advocates liberalising world trade and reforming EU agriculture policy;

Biobased economy: develop opportunities for using green ingredients in chemical, medical, and other non-food applications;

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Business climate: reduce regulations, resolve problems, and simplify policy; harmonise standards and requirements, improve logistic processes for import and export, and take the one-stop shop approach.

Appendices

70

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Appendix 1: Web sites

GovernmentStatistics Netherlands (CBS) www.cbs.nlDe Nederlandsche Bank (DNB) www.dnb.nlEuropean Union www.europa.eu.intMinistry of Foreign Affairs www.minbuza.nl Ministry of Agriculture, Nature and Food Quality www.minlnv.nl

Research AFSG Wageningen UR www.agrotechnologyandfood.wur.nl/nlErasmus University Rotterdam www.eur.nlNetherlands Geonomics Initiative www.genomics.nlAgricultural Economics Research Institute (LEI) www.lei.nlNutrition and Toxicology Research Institute Maastricht (NUTRIM) www.nutrim.unimaas.nlKluyver Centre for Genomics of Industrial Fermentation www.kluyvercentre.nlNIZO Food Research www.nizo.comUniversity of Groningen www.rug.nlNational Institute of Public Health and EnvironmentalProtection (RIVM) www.rivm.nlInstitute of Food Safety (RIKILT) www.rikilt.wageningen-ur.nlTechnical University Delft www.tudelft.nlTechnical University Eindhoven http://w3.tue.nl/nl TNO www.tno.nlTop Institute Food and Nutrition www.tifn.nlLeiden University www.leidenuniv.nlFood and Consumer Product Safety Authority (VWA) www.vwa.nlWageningen-UR www.wageningen-ur.nl www.courage2025.nl www.innovatienetwerk.org

Commodity BoardsCentral Commodity Board for Arable Products (HPA) www.hpa.nlProduct Board for Beverages www.productschapdranken.nlProduct Boards for Livestock, Meat and Eggs http://bedrijfsnet.pve.agro.nlProduct Board for Margarine, Fats and Oils www.mvo.nlProduct Board for Horticulture www.tuinbouw.nlProduct Board for Fish www.pvis.nlDutch Dairy Commodity Board www.prodzuivel.nl

Appendix 2

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Promotion Agency for International Business and Cooperation (NL EVD International) www.hollandtrade.com Biologica www.biologica.nlCentre for the Promotion of Imports from developing countries (CBI) www.cbi.nlInternational Flower Bulb Centre www.bloembollencentrum.nl Netherlands Foreign Investment Agency www.nfia.nl/ Plantum www.plantum.nl/english/indexengl.htm Port of Rotterdam www.portofrotterdam.com Port of Amsterdam www.portofamsterdam.nl

Appendix 2

Source: Company web sites and annual reports


Number of employees

Net sales (in billions of

EUR)

Net int’l sales (in billions of

EUR)

Wholesale in agricultural products and live animals including:

5135 36,900 20.559 9.646

- Grain, seeds, livestock feed . 10,300 8.968 3.423

- Plants and flowers 2405 23,400 8.278 5.266

- Animals, skins, leather, unprocessed tobacco

1250 3,000 3.313 0.957

Wholesale in food, beverages, and tobacco including:

6645 81,600 55.373 15.958

- Fruits and vegetables 880 15,500 11.393 5.787

- Other food, beverage, and tobacco . 43,700 29.595 9.304

- Food, beverage, and tobacco, general assortment

. 22,300 14.385 0,868

The wholesale agricultural products sector, 2006

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Prins Clauslaan 8

P.O. Box 20401

2500 EK The Hague

The Netherlands

Editing

martijndegroot.communicatie

The Ministry of Agriculture, Nature and Food Quality

Department of Agriculture, Fisheries and Agribusiness

Text

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martijndegroot.communicatie

Design

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Photography

Frits H. Emmerik (p8 and 9)

Ten Kate Holding bv (p8)

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Production

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Printer

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Further Information

Infotiek, Phone, +31 70 378 4062

Internet: www.minlnv.nl/international

June 2010

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