Norway’s politically strong farming lobby wants nearly NOK 1.9 billion (USD 320 million) in additional state support this year, and handed their demand to the Ministry of Agriculture and Food on Tuesday. That formally sets off the equivalent of labour negotiations for this year.
Farmers’ unions want a substantial pay raise, even though their demand is less than last year’s figure of NOK 2.25 billion. Since the major part of a Norwegian farm’s income depends on state subsidies and protective tariffs, these demands are made to the government before a round of collective bargaining each spring.
“The reason is, among other things, that some of the farmers’ costs have fallen since last year. Another reason is that in difficult economic times there is no room for inflated claims,” writes newspaper Nationen.
Farming in Norway is heavily regulated and one of the main mechanisms for distributing cash to rural districts and halting migration to the cities. The result is an annual pricetag of NOK 40,000 for each Norwegian household, according to Fremskrittspartiet, the Progress Party, which wants to deregulate the industry.
The build-up to negotiations began several weeks ago, with farmers complaining about their alleged inability to earn a decent living and the government digging in its heels. Newspaper Aftenposten even ran some stories recently about how today’s generation of farmers can’t afford to maintain the lavish mansions (called herregård) built by wealthy ancestors before them. Their properties are falling apart, they complained, apparently hoping to win sympathy.
Food price debate
Meanwhile, debate continues over high food prices in Norway. It’s hard to understand, for example, why a packet of bacon in Norway costs three times what is does in neighbouring Sweden, not exactly a low-price country itself. A study is underway to try to determine what’s to blame: The protectionism granted to farmers, the small plots of land they have with few economies of scale, Norway’s high-cost climate, the grip that just a few grocery store owners and wholesalers have on the market, or all of the above.
Grocery retailers like Reitan and Coop have also been pressuring the farmers, wanting them to deal directly with them instead of selling their goods through the traditional cooperatives like Tine (for dairy products), Nortura (for meat and poultry under the Gilde and Prior brands) and Hoff Norske (for potatoes).
Farmers are not optimistic about their chances for making more money. Only one in five believes that their farm will give them a higher income in the years to come, claims a fresh poll from Norsk senter for bygdeforskning, an institute for rural studies.
State agriculture officials now have until May 4 to come with their counteroffer to the farmers.