The Dutch dairy herd is expected to decrease by 11% or 175,000 head in 2017 in order to bring phosphate production in line with EU regulations.
The phosphate limit in the Netherlands stands at 172.9m kg/year and Dutch farmers have exceeded this over the past three years. In 2015, the phosphate production was 7.2m kg over the limit and forecasts indicate that the excess in 2016 will be 6.6m kg.
The reduction in cow numbers is part of a €50m package involving a three-element approach agreed by industry stakeholders in the Netherlands to reduce phosphate production by an estimated 8.2m kg next year.
Farmers will be compensated for reducing cow numbers with the estimated 11% reduction in the 1.62m cow dairy herd expected to decrease phosphate production by 2.5m kg/year.
The second part of the approach is to penalise farmers who produce more milk than a predetermined reference quantity. Penalties are to be linked to the compensation in reducing cow numbers and is expected to reduce phosphate output by 4m kg/year.
Feed manufacturers have also agreed to lower the levels of phosphorus in compound animal feeds. This is expected to reduce phosphate production by 1.7m kg/year.
Dutch dairy farmers need to reduce phosphate production in order to keep derogation allowances from the EU for increased nitrogen loading on land. Most high input dairy farms in the Netherlands are derogated for nitrogen loading of 250kg/ha/year, compared with the standard 170kg/ha/year under the nitrates directive.
A quota system that aimed to address the issue through tradeable phosphate allocations among farms in the Netherlands was rejected by the European Commission last month on the basis that it did not comply with EU law.
The new approach will inevitably affect milk production in the Netherlands. In 2015, Dutch milk supply surged almost 7% to a new record of 13.1bn litres following the abolishment of quotas. From January to October this year, milk output from Dutch farms is running 9% ahead of last year.