Rising production costs forced German farmers to go out of business

It has been an extremely difficult year for farmers in economic terms. The effects of the covid-19 and the sharp rise in the cost of production were critical for German farmers, reports World of NAN with reference to Agrarheute.com. 

The Skammern Agricultural Association evaluated the first farm accounting results of the last 2020/21 fiscal year and came to disastrous conclusions. In the large agricultural state of Lower Saxony, Germany, company results fell by an average of about 33%. And according to the Lower Saxony Chamber, improvement is not yet in sight.

"While surveyed farms in Lower Saxony earned 71,400 euros last year, this year it is only 48,300 euros - capital losses are recorded in all forms of activity. The strong economic base is in great danger for many companies," said Gerhard Schwetje, president of the Chamber of Lower Saxony.

Farmers are currently benefiting from the high demand and prices for grain and rapeseed. But here too, high costs are taking their toll, which have eaten up most of the revenue. In addition, farmers could not sell a large share of their grain at high prices because it was tied up in forward contracts.

Thus, the fact is that production costs continue to rise - one only has to look at the current price trends for fertilizer, diesel fuel, energy or crop protection products. This is how some farms are partially or completely abandoning agriculture and finding alternative sources of income.

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