Study warns: The number of German farms could halve by 2040

Study warns: The number of German farms could halve by 2040

According to a report by www.t-online.de,

Agriculture in Germany is facing a major upheaval, as a current study by DZ Bank shows. By 2040, the number of farms will likely be reduced by more than half. This trend clearly shows that small farms are increasingly being squeezed out by large industrial companies due to increasing cost pressure.

In addition, increasing requirements in the areas of environmental protection, animal welfare and business management are putting a strain on farms. Added to this are the shortage of skilled workers and unresolved succession arrangements in family businesses. The study estimates that the average size of a farm will more than double by 2040, while the number of farms will halve.

This restructuring of agricultural businesses requires high investments in efficiency, digitalization and the fulfillment of growing environmental protection and animal welfare requirements. This increases the pressure for greater size and innovation in the industry. Nevertheless, there are niches that offer opportunities, such as organic farming, specializations and the cooperative idea.

The phenomenon of farms dying has accompanied German agriculture for decades. The number of agricultural businesses has fallen from 1.8 million in 1949 to around 256,000 in 2022. At the same time, consumer prices rose almost twice as fast as farmers' selling prices.

These developments in the agricultural sector also have an impact on the national economy. Over the last 50 years, agriculture has experienced a significant loss of importance in terms of gross value added. While it was 3.3 percent in 1970, it is only 1.0 percent in 2022.

This study makes it clear that agriculture will change significantly in the coming years. This change will have a significant impact on the entire market, particularly in terms of food supply and the economic importance of the industry. It is important that the financial industry follows this process closely in order to respond appropriately.