Competitiveness in livestock farming
The share of livestock production in agricultural production output value in Germany is significant. Meanwhile, political framework conditions, national requirements, high animal welfare standards and other influencing factors continue to affect the competitiveness and future viability of cattle, including dairy, pig and poultry farms. The challenges are significant but can be overcome through appropriate farm strategies.
Animal husbandry in Germany is an essential component of sustainable and future-proof food production. However, these are still challenging times for livestock farmers. Between the conflicting priorities of political and social demands, farmers must manage the balancing act between animal welfare, market conditions and profitability in order to ensure their long-term competitiveness.
There are still reserves on the farm that can be further exploited. However, technical innovations from outside can also enable productive and competitive animal husbandry even offering greater animal welfare. Many suitable solutions can be seen at EuroTier 2024, which this year is themed “We innovate animal farming”. At the world's leading trade fair for professional animal husbandry and livestock management, the industry will present innovations for greater competitiveness and provide suitable answers to the challenges of our time.
Experts present the current situation
What is the current state of competitiveness of livestock farming in Germany? Agricultural economist Jana Harms from the Mecklenburg-Vorpommern State Research Institute for Agriculture and Fisheries (LFA), Stefan Leuer, Head of the Department of Business Management, Construction, Energy, Employee Advice at the North Rhine-Westphalia Chamber of Agriculture, and Friedrich-Otto Ripke, President of the Central Association of the German Poultry Industry (ZDG), shed light on the current situation in the dairy, pig and poultry sectors. In addition to presenting the important factors influencing competitiveness, the expert show what adjustments can still be made, what successful farms are doing better, how innovations in the fields of automation and digitalization can contribute to greater competitiveness and what production orientation livestock farmers can possibly use to secure their future.

Dairy: What are the determining factors for competitiveness?
The competitiveness of dairy farms, whether large or small, is generally linked to an increasingly volatile market. This applies to the prices for milk, slaughter animals, breeding animals and livestock as well as to the purchase prices for operating resources. There are regional differences in Germany, at least when it comes to marketing the products: in Mecklenburg-Western Pomerania, for example, it hardly matters which of the three large cooperative dairies the milk is delivered to, as there is essentially no difference in milk prices. The situation is different in the south-western federal states. Here, even smaller farms can be very strong if they can offer their products to processors at the best prices. The larger farms clearly have a competitive advantage when purchasing inputs due to economices of scale and often also due to available labor capacity, which can devote itself to market activities.
Other influencing factors are the availability of forage land, soil quality, the level of local rental prices and the possibility of buying or leasing land. At the same time, climatic conditions such as heavy rainfall and drought also have an impact on the competitiveness of farms, influencing the quality and quantity of the fodder, a significant cost factor on dairy farms. However, the single most important influencing factor is the employees and the farm manager. The latter must have a broad mindset equipped with an ability to recruit, train and develop employees and integrate the different personalities and skills into a team. Communication is an essential building block for the success of a farming enterprise.
What adjustments can be made
Production conditions in Germany are characterized by high personnel and building costs. High quality dairy herds with strong health and longevity perform well and are is therefore of utmost importance and a key goal for competitiveness. In order to achieve this goal, the quality of the basic feed is of crucial importance. It is also essential that employees and farm managers are trained to control and improve work processes and able to monitor animal health continually. Today digitalization can take on much of the monitoring, but requires data to be analyzed, warnings to be acted upon appropriately and courses of action to be implemented in order to avoid, for example, grass silage that is too dry at harvest or any serious illnesses in the herd.
In this context, no farm can evade investment. If only to create optimal conditions for the animals, to improve working conditions for the employees or even for the farm manager, small innovative ideas that are relatively low cost compared with the returns should be consistently sought. This starts with the design of the cubicles and ends with the bedding. Is the steady growth of dairy herds the safest bet? This applies to farms where the financial situation allows it and sufficient labor is available in the future and land ownership protects the farm's cash flow.
What the best companies do better
Success is not always a question of the size of the business or the level of income. Farm managers who hone their management skills, enabling them to successfully build a team and ultimately the business have the following in common: They continually analyze and optimize production, react very quickly to problems, are proactive, have a motivated team behind them, network with other farmers to share knowledge, are strong negotiators and are always ready for change.

The future role of automation and digitalization
There is no way around the automation and digitalization of farms and animal housing. However, the technology must be affordable and largely proven. Furthermore, work processes and routines in the animal housing must be planned in detail. Large amount of data must be processed in a way to allow the farmer a quick overview that allows immediate action if necessary. Last but not least, data should become increasingly compatible with federal, state and EU queries in order to reduce the excessive bureaucracy. In this context, the use of AI is playing an increasingly important role.
Conventional farming, label or organic production?
The best way for dairy farmers to secure their future varies greatly from region to region and depends primarily on who buys the products and how the farm is organized. At present, many dairies and abattoirs are guided by a wide variety of labels, which sometimes intervenes with the husbandry management methods, for example.
Animal husbandry represents a significant part of production costs, especially construction. When a farm is built today, it lays the foundation for at least 20 years of animal husbandry. And anyone building today has animal welfare in mind and will be able to meet certain label requirements. But to what extent the various animal welfare labels of today will still be the basis for marketing in 10 or 20 years' time is questionable.
It should also be borne in mind that environmental protection is moving more into the political and social focus. Many milk producers are already being asked to show the farm-specific CO2 footprint for their dairy. Animal welfare and the simultaneous reduction of environmentally harmful greenhouse gases certainly require a different approach to the design of animal housing for dairy. The future is not determined by whether dairy farming is organic or conventional, but by how adaptable and innovative the farm manager is.

Pigs: Performance is an important factor
An important factor for competitive pig farming is performance, which in sow farming, for example, is reflected in a high number of weaned piglets, high piglet vitality and low remounting rates among sows, and in pig finishing in high values for daily weight gain, turnover rate and low feed conversion. These factors significantly determine the profitability per place or per square meter of pig housing space. Evaluations show that the larger farms are more efficient. The situation is different when it comes to staff availability. Here, larger farms certainly have difficulties in finding capable, suitable employees. Smaller farms, which tend to solve this problem using family workers, are somewhat more flexible.
German legislation is a major obstacle to the future viability of pig farming. For piglet producers, the obligation to convert the breeding center and the future requirements for farrowing stalls represent a negative competitive factor. In the next few years, pig farmers will have to deal with the requirements of “TA Luft” (Technical Instructions on Air Quality Control) when converting larger barns in order to reduce exhaust air emissions. Both points will have a massive impact on the development of pig farming. Young, well-trained farm managers are expected to consider whether they want to continue with pig farming in the face of these challenges or whether they would be better off developing other branches of the business.
Production technology is the be-all and end-all
Basically, production technology is still the be-all and end-all in pig farming. In many cases, it determines the success of animal husbandry. In pig finishing, the issues of feed and feed conversion are crucial. Farm managers are faced with the question of when to purchase feed with a view to costs. This is not easy when the market is volatile. Many farms that have been used to buying their feed during the harvest now have to rethink and monitor the market regularly.
Another adjustment “screw” is the optimization of work processes in order to achieve good results with few employees. Many farms can still work much more efficiently. On finishing farms, for example, sharing employees with other farms is an option. Positive examples show that this can work.

Successful in production technology and purchasing and sales
It is clear that the best farms not only have advantages in production technology, but also in purchasing and sales management. Successful sow farms are much better at marketing piglets because they can generate higher premiums. In pig finishing, the focus is on feed purchasing. Successful farms have significantly lower feed costs per quintal due to better purchasing management.
Animal observation using AI offers potential
In pig farming, feeding and ventilation are already highly automated. Animal monitoring using AI-supported systems offers potential here, allowing diseases or weak points to be detected more quickly, for example. This contributes to improved production technology and higher performance and can increase the competitiveness of farms. On some large farms in eastern Germany, sow herds have to be reduced due insufficient availability of employees. Here, automation, digitalization and robotics can give farms a further boost in the coming years.
Conventional farming is still justified
Pig farms that peform well can expect to be successful with conventional, label or organic production. Label and organic production are both niches, however, and this niche will not get any bigger in the case of the latter. There is currently no significant switch from conventional to organic production.
There is demand from the slaughter industry and to some extent also from the food retail trade (LEH) for label production with level 3 and 4 housing. However, slaughterhouses, food retailers and consumers are often not prepared to pay the surcharges that a farm calculates. In addition, contractual security over a longer period of time is difficult or non-existent. This prevents interested farms from making the switch, as the third and fourth stages are associated with high investments. Particularly in the high-value regions, such systems cannot be implemented in terms of approval. Conventional housing with housing level 2 will continue to be justified for most fattening farms. On this basis, individual farms can then consider entering label production.

Poultry: Politics is a negative competitive factor
In the poultry sector, politics unilaterally drives up costs in Germany with national regulations and is therefore a negative competitive factor. Eastern European EU member states, Brazil and Ukraine, which have between 30 and 50 percent lower costs, are pushing their products onto the market. A lack of concrete guidelines for the future keeping of poultry, unrealistic initiatives such as the reduction of turkey stocking densities, as well as administrative regulations such as the TA Luft and the EU “Industrial and Livestock Rearing Emissions Directive” IED for animal housing are causing additional concern and uncertainty.
This negative influence is offset by a positive market for poultry products. Per capita consumption of poultry meat and eggs is increasing from year to year. A decisive advantage with regard to the market and production is the integrated structure of German poultry production, which gives the industry a good negotiating position with food retailers in price negotiations thanks to volume bundling and traceability. Around 95 percent of meat products from German production are currently marketed via the Initiative Tierwohl (ITW) (English: animal welfare). In the case of eggs, the KAT system, which oversees the origin and traceability of eggs in Germany, offers consumers full traceability back to the farm.
Intensive advice and support reduces the differences
The integration farms receive intensive advice from their integrations on means of production, breeding animals, feed etc.. In addition, advice is provided by the regional associations and the Central Association of the German Poultry Industry (ZDG) with its federal associations for chickens, laying hens, turkeys, geese and ducks. Every farm listed for integration is immediately notified of any shortcomings. As a result, the difference between large and small and good and less good farms is smaller than for other livestock species. In addition to the integration structure and the association structure, government regulations and the responsible veterinary authorities also have a positive influence in some cases. The result is food that meets the highest global standards in terms of food safety, animal welfare and climate protection. They come from Germany and taste good, thus directly meeting current consumer demands.
The best are usually proven specialists
The best are usually specialists who do their job intensively and use other agricultural production techniques in addition to poultry farming, such as bioenergy or photovoltaics for heating barns. They look over the fence, educate themselves and use everything that is possible to save costs and increase efficiency. And they make use of all advisory tools, including the DLG and EuroTier. They also adapt to the current challenges of our time and continue to develop. They want less government and more entrepreneurial freedom.

Digitalization makes many things more accurate and better
Automation and digitalization can maintain and increase the competitiveness of poultry farming. With the large number of animals in the animal housing, it is necessary to monitor them and carry out checks several times a day. Automatic scales can, for example, indicate animals that are eating or drinking less, and optical methods can be used to determine the location of a dead animal. Poultry farmers are shown in real time on the PC in the office when action is required. AI also brings benefits here.
Another point in this context is the climate in the housing. Thanks to modern technology, the climate conditions in the housing has never been as good as it is today. The animals are less stressed and healthier as a result, as is the livestock owner. Problems can also be better recognized. For example, if the animals avoid one area of the barn, the reason may be a broken fan or defective spray cooling in hot weather. Digitalization has not only made many things much more accurate and better, it has also made it easier for farm managers to prove control measures to the authorities.
New ZKHL origin mark supports sales of German goods
90 to 95 percent of the poultry meat and eggs sold in Germany are currently produced at ITW level 2 (ITW in English: Initiative of animal welfare), which is above the legal standard. In contrast, demand for products from the higher ITW levels 3 and 4 or from organic farming has recently declined under inflationary conditions.
In order to promote products from German production, the Zentrale Koordination Handel-Landwirtschaft (ZKHL) introduced the new “Gutes aus deutscher Landwirtschaft” (Good from German Agriculture) label in 2024, which can also be used to label poultry meat and eggs. The German agriculture and food industry and retailers are thus responding to consumer demand for labeling of German origin. Representatives of the five leading German food retail companies have issued a declaration of intent in favor of the new label, which is intended to stand for authenticity and genuine “Made in Germany”. The ZDG believes that the combination of the industry-supported ITW farming label and the ZKHL origin label introduced jointly by retailers and producers offers good opportunities for a further increase in demand and a secure future for the German poultry industry. Politicians should welcome these developments and refrain from imposing restrictive national requirements.