Why Are German Farmers Taking to the Streets? The “Crime and Punishment” of Agricultural Subsidies
At the peak of the German protests in mid-January, more than thirty thousand farmers drove over five thousand tractors from all corners of the country to demonstrate in Berlin. The German government’s announcement in late 2023 that it would scrap the agricultural diesel tax rebate was the immediate spark for the unrest.
Similarly, under the twin pressures of the energy crisis triggered by the Russia–Ukraine war and the European Green Deal’s push to “reduce subsidies for fossil fuels”, Greece and France also announced cuts to diesel subsidies at the start of the year, only to quickly backtrack amid a swelling wave of farmer protests, each announcing delays or suspensions of the cuts.
These concessions have done little to satisfy European farmers. Their anger over the diesel-subsidy cuts has quickly ignited frustration with other food and agricultural policies: cheap food imports from outside the EU, the Green Deal’s pledged target of halving pesticide use by 2030, and the requirement to leave four per cent of farmland fallow …
Opposing transition and green development, demanding subsidies and protection — in some media coverage, European farmers have once again been branded “conservative” and “far-right”. Yet this reductive narrative obscures the complex reasons behind their discontent.
Why have the cuts to diesel subsidies provoked such fury among European farmers? And how does anger at individual policies reveal a deeper, systemic injustice? Let us begin where the protests were born — in Germany.
I. Agricultural Subsidies: Easy to Introduce, Hard to Exit
Alongside the cut to diesel subsidies, the government also placed on the table the abolition of the road-tax exemption for agricultural machinery — a policy dating back to the 1920s that exempted farm vehicles from road tax charges. Were it scrapped, each farm machine would incur an average road tax of €2,500 per year.
As two key instruments of post-war Germany’s drive for food self-sufficiency and agricultural modernisation, these policies together boast over 170 years of “illustrious history”, costing the German federal government an average of €920 million per year (equivalent to roughly RMB 7.187 billion). The pressure of such an abrupt change of course can readily be imagined.
Under the pressure of large-scale farmer protests, the German government has already relented, retaining the machinery tax exemption and setting a three-year transition period for the diesel-subsidy cuts. Friedrich Heinemann, a professor of economics at Heidelberg University, expressed regret at the outcome during a public hearing at the Bundestag in January.
Heinemann believes the diesel subsidy should be abolished. By providing a generous price incentive, the subsidy encourages farmers to rely on diesel and diesel-powered machinery, leaving farm-management practices that could reduce diesel consumption largely untapped. Machinery manufacturers, in turn, have little incentive to develop equipment with higher energy efficiency or alternative fuel sources.
That said, the policy has undeniably achieved its original aim of strengthening German agriculture’s competitiveness. With stable subsidies for machinery and energy, coupled with policies to consolidate land resources, German agriculture rode a wave of benefits smoothly through mechanisation and modernisation.
By the 1970s, agriculture in the German Democratic Republic had already been largely mechanised, with the highest number of farm tractors per thousand hectares in Europe. Today, Germany is among the world’s largest exporters of agricultural machinery. In its official agricultural white paper, the German government proudly declares that “one German farmer can feed 140 Germans”.
Yet behind this high degree of mechanisation lies a relentless rise in the energy consumption of food production and the deep entrenchment of the food system in fossil fuels.
The Netherlands, another European agricultural powerhouse, offers a telling parallel. In The New Peasantries, Professor Jan Douwe van der Ploeg cites Smit’s study of energy consumption in Dutch food production: in 1950, a Dutch farm needed to invest 81 kilojoules of fossil energy to produce 100 kilojoules of food; by 2015, that figure had risen to 225 kilojoules — the energy cost of producing the same amount of food had nearly tripled.
Professor van der Ploeg explains that the structural shift in food production towards high yield and high energy consumption, and in traditional smallholder farming towards “entrepreneurial agriculture”, was accompanied by the expulsion of labour by capital; in other words, small-scale farming was displaced by energy-intensive new agricultural technologies and the agricultural loans that incentivise farmers to adopt them.
In crop production, the rise in energy consumption is driven primarily by fertiliser inputs and diesel-powered machinery. A study of open-field cropping in Europe found that these two factors account for fifty per cent and thirty per cent of total average production energy, respectively. In livestock farming, the increase in energy use manifests in the adoption of non-native high-yield breeds, protein-rich compound feed, and associated indoor housing systems with mechanised and automated facilities. Ever-iterating technology and rising fixed costs bind farmers ever more deeply into the mainstream market system.
II. Why Protest? Large Farms Fight for Profit, Small Farms Fight for Survival
According to statistics, a mid-sized German farm that uses over 8,000 litres of diesel a year receives around €1,700 in diesel subsidies annually (equivalent to approximately RMB 13,183).
Given that the average annual agricultural income of a full-time German farmer stands at €82,000 (roughly RMB 640,000), several economists have argued that the additional costs from the subsidy cut would not materially affect farm output. Moreover, half of German farmers’ income already comes from public subsidies provided by the EU and the German government.
Yet it is well known that agricultural subsidies are largely tied to the number of hectares a farm operates. Under the EU’s Common Agricultural Policy, four-fifths of subsidies flow into the pockets of large farms and big agribusiness companies — entrenched beneficiaries of the current system who continue to spare no effort in claiming every last available advantage. Those truly facing a crisis are the smaller family farms that remain heavily dependent on mechanised and energy-intensive inputs.
Rather than small farmers being angry simply because of the diesel-subsidy cut, it is more accurate to say that a cascade of cost crises has made them viscerally aware of the ills of industrial agriculture’s heavy reliance on energy inputs.
Thirty-seven-year-old German farmer Marc Bernhardt is a typical example. In the Saxon region of eastern Germany, Bernhardt and his father manage a family farm passed down through the generations. They keep around a hundred dairy cows and grow grain and maize for cattle feed.
The farm is small in scale but has been entirely automated: the cows find the milking machines on their own without any human guidance, and cleaning the cow sheds no longer requires manual labour but is entrusted instead to robotic floor cleaners.
Bernhardt told the German media outlet The Local that if the diesel subsidy were scrapped, their income from it would fall by ten to fifteen per cent. But that is only a fraction of the cost crisis they have faced in recent years: since the Russia–Ukraine war, farm production costs have risen by forty per cent overall, with electricity bills alone surging by fifty per cent. And most recently, prices for a number of German agricultural products, fresh milk included, have begun to fall.
“We produce just as much food, yet our income is shrinking. That is not fair,” Bernhardt said. To weather the crisis, he will have to find other ways to bring in revenue.
Although the German government has claimed that farm profits rose by forty-five per cent year-on-year in 2022/2023, Martin Odening, a professor of agricultural economics at Humboldt University, argues that the average figure for short-term profit growth carries little reference value: “For some farms, particularly small ones, profit growth does not necessarily offset rising costs.”
Volatility in energy and food prices and crop losses caused by extreme weather can all deliver a devastating blow to farm revenues. Together, these factors amount to the last straws that crush small farms.
For a small farm, survival comes down to two paths: expand production to achieve economies of scale, or step off the field altogether.
Fewer farms, larger plots — this has been the defining pattern of German agriculture for over half a century. Data show that between 1970 and 2016, the average German farm grew from 11.1 hectares (approximately 166.5 mu) to 60.5 hectares (approximately 907.5 mu), while the number of farms plummeted from 1,146,900 to 275,400.
Small farms that can no longer turn a profit are disappearing, while those that remain are steadily increasing their reliance on machinery and energy inputs — which in turn means more labour will continue to be displaced from agriculture.
Over the past two decades, the number of full-time farmers across the EU has fallen by one-third — the equivalent of five million agricultural jobs, of which 160,000 were in Germany.
All of this has plunged twenty-six-year-old German farmer Nathalie Diebow into confusion and pessimism; she no longer sees what purpose small farms still serve. As part of the next generation set to shape Germany’s agricultural future, she too joined the farmer protests in the eastern city of Cottbus.
III. The Future of Agriculture
Recently, the European non-profit Alliance of Rural Actions (ARC) published a commentary titled “Blame the System, Not the Farmers!” defending the protesting farmers: “European farmers are by no means xenophobic nationalists. On the contrary, they feel betrayed by a system that first pushed them down the path of expansion, industrialisation, and multiple dependencies, and now demands that they pay the price for that very system’s failures.”
Almost simultaneous with German farmers’ tractor protests, on 15 and 20 January this year, nearly ten thousand conventional and organic farmers, food-sector workers, consumers and social activists gathered on the streets of Berlin for the 2024 “Wir haben es satt!” (“We’ve Had Enough!”) demonstration.
In response to the abolition of diesel subsidies, the march’s organisers called for “cutting harmful subsidies without destroying farms”, stressing measures to support the long-term viability of German family farms, such as ensuring fair prices and introducing a farmland transaction tax. Additionally, opposing the easing of EU GMO regulation and supporting pesticide reduction are core demands rooted in driving the climate transition and food justice at a fundamental level.
While both responses seek to situate the protests within a more complete and complex picture, there is also a voice that reduces the subsidy cuts to a matter of technical feasibility alone, arguing that current alternatives remain inadequate — biofuel, biodiesel, and vegetable oil are too costly, while electric machinery is limited by battery capacity and can hardly replace diesel-powered farm equipment across the board.
These technical difficulties are, of course, entirely real and well founded, yet they all take the current model of agriculture for granted. It amounts to asking: without diesel power, how can large agricultural machines possibly keep running? What no one seems to consider is that a model of agricultural production using less energy is not only feasible but is gradually revealing its own advantages.
Lars feeds his flock pricier organic feed, and his poultry products are sold mainly to restaurants and individual consumers, with all value added staying on the farm. Although the farm’s on-paper turnover is currently less than €100,000, by saving on the fixed investments in technology and housing infrastructure that conventional operations require — along with the corresponding energy demands — the farm carries no financial pressure. As a result, he has little motivation to take to the streets.
Lars believes the true object of farmers’ protest should be Germany’s four supermarket giants: Edeka, Aldi, Schwarz and Rewe. Over the past several decades, farmers have received ever less under the dominance of supermarket power.
He also suggests that the German government should reform subsidy policy to favour more sustainable production methods and smaller family farms; that marketing should be more closely linked to the farm itself, so that value added genuinely returns to the producer; and that, in the longer term, farmers’ dependence on subsidies should be reduced and their production autonomy enhanced.
In the view of Sebastian Abis, an agricultural expert at the French think tank IRIS, long-term success in this transition requires not only new incentive structures for farmers set up by government, but also the active participation of consumers and citizens: “European consumers must be consistent: supporting European agriculture means buying European produce and paying a fair price for it.”
What can be foreseen is that the scrapping of diesel subsidies across Europe is merely the beginning of a long transition for energy and food systems. A more sustainable future will inevitably mean radical transformation in every sense — and no one will be spared.
[2] https://www.instagram.com/p/C11-mdGsIwd/
[3] https://www.thelocal.de/20240116/german-family-farm-struggles-fuel-protest-discontent
[4] https://www.sciencedirect.com/science/article/pii/S1364032122000284
[8] https://www.arc2020.eu/blame-the-system-not-the-farmers/
[9] https://www.ft.com/content/cd2cd90f-9161-4ae1-96a2-c563dee6c60d
[11] https://foreignpolicy.com/2024/01/18/germany-farmers-protest-subsidies-cuts-populism/
[14] https://www.tandfonline.com/doi/full/10.1080/03066150.2020.1725490
Editor: Kairui