Modernizing German livestock farming and raising the standard for animal welfare lead to higher agricultural production costs, but are affordable if the government supports the sector with billion-euro investments. This can be recouped through a VAT increase on food products and costs about five cents per meal.
This emerges from a scientific calculation by the authoritative Thünen Institute. At the request of Agriculture Minister Julia Klöckner, these German analysts reviewed the agricultural modernization plan of former Minister Borchert and a professional committee.
Borchert and other advisers believe that over the next twenty years, the level of animal welfare in the German agricultural sector must increase significantly, that pig breeding and the poultry sector must deliver higher quality, and that more attention must be paid to climate and sustainability.
Depending on the type, the additional costs range from a minimum of 9% for dairy cows up to as much as 44% for broiler chickens. As an incentive for the transition to higher animal welfare standards, the government should finance the extra costs for farmers via investment subsidies plus regular animal welfare premiums. This also requires renewing and expanding stables.
Depending on the type, the expected additional costs range from at least 9% for dairy cows to as much as 44% for broiler chickens. Production costs in pig breeding, dairy farming, and beef production will be around 10 to 16% higher. For breeding sows, costs are expected to be about 25 to 30% higher. In an even higher category for animal welfare in broiler farming, the additional costs could be 44% higher.
Agriculture Minister Julia Klöckner (CDU) sees the impact assessment as confirmation of the plans for restructuring and modernization. According to her, the Thünen Institute shows that companies which would have withdrawn from livestock farming under current conditions now have a new perspective.
Now, in the coming months (during the election campaign!), the focus must be on a political agreement about a financing model, Klöckner said. Financing could come through an increase of VAT from 7% to 19% on animal products, or via an animal welfare tax that acts as a consumption tax. A third option (higher income tax) is now off the table.