Risk Management in Agriculture in The Netherlands

This report analyzes the agricultural risk management system in the Netherlands, applying a holistic approach that considers the interactions between all sources of risk, farmers’ strategies and policies. The policy analysis is structured around three layers of risk that require a differentiated policy response: normal (frequent) risks that should be retained by the farmer, marketable intermediate risks that can be transferred through market tools, and catastrophic risk that requires government assistance. The main risk-related policies in the Netherlands are implemented as part of the EU policy framework. Specifically, national policies focus on the management of catastrophic risks by promoting public-private partnerships, such as Livestock Veterinary Fund, to manage the costs of livestock epidemics. The mutual insurance companies specialised in the coverage of specific types of risks are also promoted, with some of them receiving start-up capital and re-insurance support. The recently launched subsidised multi-peril yield insurance exploits the new opportunities created by the EU framework.