Moving in the right direction
Although the outlook for Denmark's agricultural and food industry is now looking more positive, the government still has a crucial role to play in delivering a more business friendly environment to allow it to exploit its many inherent strengths.
The latest economic survey undertaken by the Danish Agriculture and Food Council paints a positive picture for Denmark’s food and farming industries. The latest information contains the most optimistic forecasts for three years for returns on farming and these are generating renewed optimism in the agriculture and food industries. Agri-exports are also running at record levels.
This upbeat outlook was backed up by another recent survey from Rambøll Management which showed that agriculture and food companies in Denmark surpassed their own export forecasts by a large margin over the last six months and expect further progress in the months ahead. The analysis also identified a greater willingness to invest, which is essential for growth in the future.
“We are constantly working to achieve greater exposure to emerging markets. Customers are there, and demand is growing, because the world’s middle classes are expanding. Therefore, it is necessary that we be allowed to produce more goods in this country. A stable supply of raw materials and more intelligent regulation is a prerequisite for Danish companies maintaining their positive growth,” said Søren Gade, CEO, Danish Agriculture and Food Council (DAFC).
In a recent article in Folketidende, Lars Hvidtfeldt, Vice Chairman of DAFC, emphasised the importance of the food and farming industry to the Danish economy and the vital part to be played by the Danish government in supporting the industry in realising its potential.
Denmark ranks among the highest in the world in terms of the costs of running a business, when wage levels, taxes and other business costs are taken into account. This represents a real risk to Danish business in an increasingly competitive international marketplace.
The recent ‘Growth Package’ (Vækstplan DK) announced in February 2013 was a step in the right direction, but more action is still needed to help restore Danish competitiveness. For example, it was unacceptable that some of Denmark’s local authorities took several years to deal with applications to expand or modernise livestock production.
The implementation of strict environmental legislation in Denmark is continuing to place the Danish agricultural industry at a significant disadvantage to many of its EU and global competitors.
Within the pig sector, prices increased significantly during the first six months of 2013 and the prospect of lower grain and soya prices, following the harvest period, presented an opportunity for producers to restore the profitability of their pig producing enterprises.