Key Challenges and Insights in Greek Livestock Farming: Expert Answers to Pressing Questions

Ioannis Kaimakamis

Agribusiness Consultant and Expert in Livestock Industry

9 min read
23/10/2024
Key Challenges and Insights in Greek Livestock Farming: Expert Answers to Pressing Questions

Over the course of his career, Dr. Kaimakamis has faced numerous questions about the key challenges and advancements in Greek livestock farming. From managing rising operational costs to promoting sustainable practices, these questions have shaped his understanding and approach. Below are some of the most pressing inquiries and his in-depth responses, providing valuable insights into the future of livestock farming in Greece.

1.    What factors affect the success of a livestock unit in Greece, especially now that operating costs have increased?

We are entering a period where animal feed costs are decreasing. Given that feed costs account for 40-70%, depending on the industry and production system, operating costs in almost all sectors are reduced in determining the final cost. However, the central issue relates to low productivity—specifically, the cost of producing livestock products per unit of reared or fattened animal, which mainly affects the ruminant sectors, particularly sheep farming, goat farming, and beef production.

From there, the factors that can lead to success in livestock models are similar to those linked to successful business practices and strategies in other industries. This is because livestock farming, in a broad business context, is an entrepreneurial activity and should be treated as such. It has already been mentioned that the cost of animal feed is a significant part of the operating costs of a livestock operation. It is, therefore, vital that this cost center is managed efficiently. Animal health is also a significant success factor for a livestock unit. Market conditions and prices are factors that can maximize revenues.

For a producer and a model to succeed, they must embrace the philosophy of lean production: "How can we do more with less?" Naturally, they should have an accountant, a lawyer, a financial advisor, and a veterinarian. We must remember that livestock businesses are actual businesses. Budgeting, forecasting, production cycles, stockholding, investments, and future goals—all on an individual level—are crucial. Furthermore, I insist on creating cooperatives that do not resemble the failed cooperative models of the past. They should be modern, business-like structures with mass stakeholders, not made merely to secure points in improvement plans or receive enhanced tax reductions.

Let me close my response with another point: "Skill before scale" as a success factor. We need to train livestock farmers in the economics of animal production before they decide to scale their businesses. It has been observed that there is a degree of "illiteracy" regarding the economics of livestock production. Here, industries can play a vital role, often providing capital for purchasing animals or facilitating interest-free financing. Is a livestock farmer ready to scale up? How is risk assessed? How is failure—related to financial management, excluding other livestock-specific parameters—factored in?

2.    How can the environmental footprint of animal production be reduced?

I will insist on increasing economic and technical productivity. We must produce more financial and technical outputs with correspondingly fewer inputs. Beyond that, many applied zootechnical practices combine technologies, genetics, and nutritional interventions. However, I will focus on the power of genetics and provide an example. About ten years ago, a complete genome analysis of a cow would cost between €8,000 and €10,000. Today, that service costs around €100 for a complete analysis.

Furthermore, the costs of equipment for such laboratory infrastructures are at historically low levels. Just imagine the potential these assumptions hold for our country's future of livestock farming. Therefore, I propose a policy suggestion: creating a modern national infrastructure for genetic improvement, identifying ruminant animals, using resources from the Rural Development Program (RDP) or the Recovery and Resilience Facility (RRF), and promoting new breeding methods like artificial insemination. Such an investment could involve the Ministry of Agricultural Development and Food (MinAgri) as a key partner, with private capital in joint ventures.

3.    The increasing demand for meat and dairy necessitates a more environmentally friendly approach. Innovations in sustainable livestock farming are already making a difference. To what extent have Greek farms adopted such practices, and what can be done to promote them further?

This question is complex and requires thoroughly examining the current market situation in Greece. Is there consumer demand for livestock products with a high environmental impact? In most European markets, demand for these products is actually declining. The only exception is Switzerland, where demand for such livestock products is rising, making it the sole market with a growing trend in this area.

This situation has been significantly influenced by the intense inflationary pressure in food markets, with most consumers focusing on price increases and seeking fewer eco/bio/natural/local products. However, let me speak about market shares and numbers and answer two or three questions. According to recent Nielsen data, the market share for bioproducts in the domestic milk market, categorized under "white milk," was only 4.4% by value, and for yogurt, it was 1.7%. This raises a big question: Is the primary production sector attractive for investments aimed at eco-friendly production? What are the market shares? How is value capitalized? What Return on Investment (ROI) works for such a strategy?

A central policy issue related to the Common Agricultural Policy (CAP) and the schemes promoted in our country can also be highlighted here. Indeed, the CAP prioritizes an environmentally friendly direction as a critical strategy for the future and develops policies that align closely with this framework. The country has followed the same policy direction with proposals for activating the so-called eco-schemes. From this platform, the central strategy is headed in the wrong direction, attempting to develop production models based on a supply-driven logic rather than the dominant demand-driven one.

I will return to the issue of "environmental friendliness" and "innovation." The trends toward these directions are more intense and are driven by factors related to the final product, not the raw material itself. Regarding raw materials, there is a search for the "profile of good health" and "high nutritional value." Consumers want environmentally friendly packaging and products of superior nutritional value (e.g., high in protein).

4.    Livestock farming and its related processing produce unwanted and difficult-to-manage by-products. To what extent does your country monitor technological developments in managing livestock waste?

Your question hinges on the word "unwanted," which I do not accept. Still, you correctly identified these products' technical and commercial nature by referring to them as by-products. So, we are discussing secondary products with inherent value, not by-products or waste. Little has been done in our country to achieve holistic management with minimized pollutants in manure management and other by-products at the primary production level. However, this issue does not relate to adopting technological advancements but to ensuring profitability through such investments. The potential of a livestock production unit alone is insufficient. Other factors, such as the seasonal availability and variability of components of interest for such processing, also act as deterrents to the installation of these types of technologies and investments. Nevertheless, I believe there needs to be a central plan and direction regarding processing products beyond the main product for economic and social-health reasons. In my view, livestock farming and processing can become bio-refining models of high value, primarily through synergies, offering prospects for upgrading existing structures and developing investments.

5.    How can renewable energy sources contribute to livestock farming, and how can their use be increased?

This is related to the question of managing by-products or waste. We have yet to make much progress beyond installing certain investments to produce biogas through the anaerobic digestion of manure. Additionally, there have been small investments in net metering for energy production through photovoltaic (PV) panels. As for increasing the use of renewable energy, there needs to be a legal framework that removes barriers. However, we must also be honest whenever we want to propose solutions or present opinions on policy matters. Unfortunately, many livestock facilities do not operate under the required permits, making installing systems such as roof-mounted panels much more difficult. Additionally, network saturation is due to the installation of large PV parks in rural areas. I support large-scale investments; however, when it comes to energy via PV, we should adopt models that contribute to local agricultural communities, especially in livestock production, with reciprocal benefits.

6.    What water resource management techniques do you recommend for ensuring sustainable livestock production?

Water is the most essential nutrient in animal diets; no species can survive without it. We see prolonged periods of drought, and the risk of water scarcity has been extensively analyzed. On the other hand, water is also linked to natural disasters. Therefore, scenarios need to be examined with at least double the importance. The truth is that our country has yet to do anything regarding water resource management. Thus, a clear and applied water management policy for gradually implementing solutions is necessary. In this context, I welcome the Minister of Agricultural Development and Food, announcing the establishment of a unified water management body, with Thessaly being prioritized as a pilot region. So, let's start from that point. Water management techniques and technologies do exist. However, since we are discussing this topic, I would like to highlight a critical issue concerning water—not quantity but quality. I will conclude my comment by modifying my statement: "Clean water is the most important nutrient in animal diets." Thus, any policy or technical approach must ensure water availability in quantity and quality and prevent the damage it may cause due to climate change.

7.    Dr. Kaimakamis, in 2023, we experienced unprecedented disasters that no one can guarantee will not be repeated, possibly with greater intensity. Which livestock operations do you expect to survive, and what are the characteristics of a resilient unit?

In the case of such large-scale disasters, it is not a question of resilience, as we are talking about complete, not partial, damage. Therefore, the issue is the return to production. Who will return to production? First, those farm managers ready to take on the challenge of building a unit, or almost from scratch, will return. Thus, in the first phase, we should discuss categories of people and livestock businesses. Another issue relates to the sector in which the operation is active. Livestock farming is now becoming a capital-intensive activity, partly because of the intensity imposed on production systems. For this reason, government support and access to financial tools are critical. Here, we should also look for new financial tools beyond the traditional ones, such as the development of leasing financing for acquiring fixed assets and livestock, with bank involvement and guarantees from the Greek government.

8.    Do you believe that the necessary lessons will be learned from last year's disasters by livestock farmers? What should change in the institutional framework to better protect the future?

The main lesson to be learned is that natural disasters are a part of our lives and, by extension, part of livestock farming. At the institutional level, I prioritize the intervention regarding the mandatory insurance of fixed assets and equipment. I will not dwell on the announcements concerning the new ELGA (Greek Agricultural Insurance Organization) framework, which operates under a hybrid model. I consider the success of this effort very challenging. However, there is a better time for further analysis on this. Yes, we need to break the "taboos" that maintain the issue of insurance under a public framework. Beyond that, I think we have to establish a reliable system for assessing the value of a livestock unit and open the market to private insurance products and banks. Yes, this constitutes an institutional change—the acquisition and promotion of that leadership political profile, which will explain to all structures within the livestock sector that "you can’t make an omelet without breaking eggs.Additionally, creating a central system for natural disaster warnings, which has already been announced, could add value.

Further reading

Precision Livestock Farming in Pasture-Based Dairy Systems: Monitoring Grazing Behavior

Low Self-Sufficiency and the Urgent Need to Transform Greece’s Beef Fattening Model

How the French Livestock Model Can Inspire Greek Farming

How to reduce heat stress in dairy cattle

Essential Tips for Choosing Animal Feed to Boost Health and Productivity

Influence of Rearing Substrate on Black Soldier Fly Larvae Nutritional Value for Animal Feed

Training Livestock Farmers for Sustainability and Food Security

tags :livestock
Ioannis Kaimakamis
Agribusiness Consultant and Expert in Livestock Industry

More from Ioannis Kaimakamis

3 min read  ·  Oct 11, 2024
2 min read  ·  Oct 4, 2024
View more articles