New insights for sustainable livestock farming
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New insights for sustainable livestock farming

  • 03 April 2023

Connecting Agri & Food BV recently published a report outlining instruments that can help improve the earning capacity of livestock farmers and create room for investments in sustainability and animal welfare. 

These instruments include stable price systems, corrections for expected changes in feed prices and aligning compensation with the investment pace of farms. The report also discusses the possibilities of cooperation in producer groups and the potential role of the Dierenbescherming (Animal Protection Society) in including Fair Trade criteria in the 'Beter Leven' quality mark.

Price system

The current market for meat and eggs functions as a poorly tuned engine due to the weekly game of trade, anticipating expected price changes. This leads to failure costs that could have been avoided with proper tuning within the chain. Transparency and stable price systems are therefore important to establish connections between the back end (farmers) and the front end (retailers) in the chain. A stable price system should be based on a reference price for the primary link, determined by market participants based on publicly available data sources.

A price system based on annual figures takes limited account of changes in feed prices, while feed costs represent a large cost item. Therefore, the stable price system determines the expected feed price for the coming months by analysing price developments in the market and the expected price development of raw materials on the futures market.

Fees 

Participants in sustainability labels now often receive the same fee and/or price within the same chains, but an average fee is not appropriate in all cases. To support livestock farmers to invest in additional animal welfare, such as free-range stall pens in pig farming and indoor runs in poultry farming, compensation should be tailored to the investment rhythm of farms and take into account differences in off-take contracts.

All in all, the report by Connecting Agri & Food BV provides tools for livestock farmers to improve their earning power and invest in sustainability and animal welfare, while avoiding failure costs through transparency and stable price systems.

Open the report: 'Towards added value(s) through collaboration in the chain'
Image: RS 74/Shutterstock.com

Source: Connecting Agri & Food BV