Denmark’s new carbon tax targets an often-overlooked greenhouse-gas producer: agriculture. Yet the plan locks in big Danish farmers’ focus on energy-inefficient animal farming for export, frustrating hopes of a serious cut in emissions.
December 7, 2024
Source: Jacobin
Denmark’s parliament recently passed a so-called tripartite green deal, agreed between the agricultural lobby, trade unions in the agricultural and food sector, and the Danish Society for Nature Conservation. Especially attracting international attention is its promise to implement a carbon tax on agriculture and turn 15 percent of agricultural land into forests and natural habitats. The new minister responsible for the deal fed the hype, claiming that “Danish nature will change in a way we have not seen since the wetlands were drained in 1864.”
The tax signals a shift in climate policies, which have long evaded dealing with agriculture’s contribution to global warming. Understandably, the primary focus has been on the leading cause of the planetary crisis: the fossil industry. However, agriculture and food production are deeply intertwined with fossil industries and infrastructure. They directly emit potent greenhouse gases such as methane and nitrous oxide, many times stronger than carbon dioxide.
Today, food and agriculture account for at least a quarter of global emissions. In Denmark, however, this share exceeds one-third, and rising. It is Danish agriculture’s focus on animal production for export that makes it especially inefficient. To sustain its substantial pig meat and dairy exports, it relies heavily on protein-rich fodder, which requires significant land use in other countries. It produces less protein than it consumes. As the nation with the highest number of pigs per capita worldwide, Danish farming also pollutes waterways and marine ecosystems through nutrient runoff caused by the application of animal fertilizer.
Simultaneously inefficient and environmentally detrimental, Danish farming contributes minimally to employment (around 2 percent of the workforce) and holds negligible economic importance. In every respect, it is unsustainable. Yet, the new tripartite green deal takes it for granted that its focus on animal production for export must remain locked in place.
The Politics of Carbon Taxes
The carbon tax has been in the works for some years now. The former Social Democratic government created a committee in 2021 tasked with providing a proposal for a potential carbon tax on agriculture. The committee’s proposal was only presented in February 2024. In the meantime, the tax became a hot topic, reshaping the existing political dynamics.
For left-wing and green parties like the Red-Green Alliance, the Alternative, and the Socialist People’s Party, the goal was a tax high enough not only to reduce greenhouse-gas emissions in the short term but also to prompt a structural shift. These parties and others favor a shift from intensive animal farming toward more plant-based food production.
On the far right, the relatively new Denmark Democrats, led by Inger Støjberg — previously sentenced to two months in jail by the Court of Impeachment for misconduct in office after separating families in migrant centers — capitalized on the carbon tax debate to fuel a rural-urban divide. In recent years, the Denmark Democrats have gained significant traction at the expense of the former leading party on the Right, the Danish People’s Party.
Following the carbon tax proposal, the Denmark Democrats launched a loud campaign arguing that industrial pig and dairy farmers must be allowed to continue polluting the atmosphere to preserve jobs and sustain rural communities. This rallying cry is in fact baseless: the concentration of farmland caused by the industrialization of pig and dairy farming has itself depopulated rural areas for decades.
The new coalition government, composed of the Social Democrats, the liberal Moderates, and the traditional liberal farmers’ party — called the Left for historical reasons — faced significant internal disagreement over the rate of the carbon tax. To address this, the government invited the agricultural lobby, trade unions in the agricultural and food sector, and the Danish Society for Nature Conservation to negotiate a tripartite deal that could be presented to and hopefully passed by parliament.
By ensuring support from both the major agricultural lobby organization and Denmark’s largest and oldest environmental organization, the coalition government sought to secure both internal consensus and parliamentary approval. Negotiations proved fruitful, and the tripartite deal was presented in June. After several rounds of discussions, it was approved almost verbatim by a parliamentary majority this month, amid widespread applause.
During negotiations, it became evident that the Danish Society for Nature Conservation and the agricultural lobby could not agree on the carbon tax alone. Additional measures were required to secure a compromise, leading to the inclusion of a land-use reform. As a result, the final deal included a commitment to convert approximately 15 percent of Danish farmland into forests and natural habitats.
On the Right, the Denmark Democrats and the Danish People’s Party withdrew from negotiations early on. On the Left, the Socialist People’s Party supported the final deal despite having campaigned against the industrial agricultural lobby, while the Red-Green Alliance and the Alternative left the negotiations, arguing that the agreement fell short of guaranteeing sufficient reductions in greenhouse-gas emissions and nitrogen runoff. Consequently, the deal has driven a wedge between left-wing and green opposition parties, weakening their ability to form a united front for meaningful agricultural reform.
Butter and Bacon
Indeed, a transformation of industrial animal farming in Denmark is urgently needed. However, the current deal risks entrenching Danish agriculture further into unsustainable industrial animal-farming practices, which, in just a few years, are expected to account for over half of the country’s total greenhouse-gas emissions.
To understand this, we need to take a brief look at the structure of Danish farming. Since the late nineteenth century, it has been heavily oriented toward animal farming for export. By establishing cooperative dairies and slaughterhouses, Danish farmers secured a lucrative trade producing and selling butter and bacon to the British market. Although export markets have since shifted and farmers have specialized, animal production for export remains Danish agriculture’s primary focus.
Today, only about 6,000 highly industrialized full-time farms exist in Denmark, specializing in pig or dairy production. The average farm cultivates roughly 270 hectares of land, while, for example, the average pig farm produces nearly 28,000 pigs annually. However, these averages obscure the true concentration of Danish farming: just 20 percent of farms account for around 80 percent of the sector’s total turnover, and only 30 percent of farms account for 70 percent of agricultural land.
Industrial animal farming dominates agricultural land use in Denmark, covering 60 percent of the country. Major crops like barley, wheat, and maize are used almost exclusively as fodder. The sheer volume of imported soybean meal used in animal feed requires land in other countries equivalent to roughly a quarter of Denmark’s total agricultural area.
Obviously, such an intensive system of animal production emits significant amounts of greenhouse gases. The digestive processes of millions of animals in industrial stall systems release large quantities of methane, while the storage of thousands of tons of slurry emits both methane and nitrous oxide. Furthermore, cultivating millions of acres for fodder crops produces nitrous oxide emissions when slurry and commercial fertilizers are spread on the fields.
The new carbon tax on Danish agriculture targets the first two processes: emissions from animals and slurry management. However, the major agricultural lobby organization played a crucial role in the negotiations over the deal, ensuring that it would be too small and implemented too late to have a meaningful impact.
The tax will be phased in gradually between 2030 and 2035. Many news outlets have reported that it will start at $43 per ton of CO2-equivalent, rising to $107 by 2035.
However, Denmark’s industrial farmers secured a much more favorable deal. They will receive a substantial discount and will not be taxed on the first 60 percent of their emissions. This discount means that if an industrial pig or dairy farmer reduces emissions by 40 percent before 2030 — such as by installing a biogas facility — they will effectively pay no tax. Officially, the effective tax rate after the discount will be only $17 per ton of CO2-equivalent in 2030, rising to just $42 by 2035.
The discount is justified by the negotiating parties with reference to the “actual options” available to farmers. The phrase refers to farmers’ options to invest in existing technologies rather than to significantly reduce the scale of industrial animal farming. Reducing animal-based production for exports and confronting large industrial farmers is not considered an “actual option.” So, many polluting farmers will avoid paying anything at all.
Furthermore, the deal includes a wide range of subsidies for technologies such as methane-reducing feed additives and biochar, as well as reductions in other taxes affecting the pig and slaughterhouse industries. In other words, the carbon tax is deliberately designed not to promote a structural shift from animal-based to plant-based food production. Instead, it incentivizes farmers to invest even more capital in technologies that further intensify stall-based animal production.
Land-Use Conversion?
While the deal assumes that the carbon tax will have some impact on reducing greenhouse-gas emissions, much of the reduction is expected to come from converting farmland into forests and natural habitats, as well as farmers incorporating biochar into their fields. By heating biomass under oxygen-free conditions, biochar is produced that can potentially be used to store carbon. However, biochar is currently an unreliable technology with possible negative environmental and health effects — making the projected reductions from its use highly speculative.
The deal aims to convert around 250,000 hectares of farmland into new forests and to transform 140,000 hectares of cultivated low-lying soils into natural habitats. This is primarily the result of demands from the Danish Society for Nature Conservation. For the majority of these hectares, however, there is no mechanism to ensure their actual conversion. The subsidy rate for converting farmland to forests is calculated from the least valuable soils, leaving almost no incentive for most farmers to sell when they can continue to profit from business-as-usual. What would motivate a large industrial pig or dairy farmer — who has just received increased subsidies and invested even more heavily in new buildings and technologies — to sell off large portions of the fields needed to feed their animals?
The deal does include a mechanism for some of the low-lying soils to address both greenhouse-gas emissions and nutrient runoff. Intensive animal production not only emits greenhouse gases but also contributes to nitrogen runoff into rivers, lakes, and coastal waters. Nitrogen runoff has caused significant problems with eutrophication in Danish marine ecosystems over the past several years.
Aside from a negligible tax on low-lying soils ($5 per ton of CO2-equivalent), it is expected that new regulations on nitrogen application to fields could be enforced from 2027. If implemented, nitrogen regulation would be the only mechanism capable of genuinely incentivizing farmers to sell off some of their farmland. However, it remains entirely unclear how strict these regulations will be or how much agricultural land they will affect. Regulations on nitrogen fertilization for the remaining farmland may possibly become even more lenient. Much will depend on future political negotiations, made yet more difficult by the split within the broad left-wing and green camp.
In short, the design of the carbon tax will further intensify stall-based production, locking agricultural producers even more deeply into unsustainable industrial animal farming. There is no mechanism to ensure the necessary reductions in greenhouse-gas emissions or nutrient runoff. Instead, large-scale industrial farmers will receive even greater subsidies and be able to claim they are “climate-smart” while continuing business as usual.
Fighting Landowner Power
Still, business as usual will surely be challenged in the near future. Denmark has committed to achieving net-zero emissions by 2045, supported by a large political majority. By that time, agriculture will likely account for well over half of Denmark’s total emissions. Consequently, by further entrenching agricultural producers in an unsustainable system of industrial animal farming, the deal sets the stage for a new wave of conflicts over farming policies in the coming years.
Because of the deal, however, left-wing and green opposition parties will be unable to form an alliance to push for the needed reforms. The situation is further exacerbated by the split between the Danish Society for Nature Conservation, which supported the original deal, and nearly all other green civil society organizations — such as the Green Youth Movement, the Climate Movement, Greenpeace, animal rights groups, and the sizable association of organic producers — who have been highly critical of the agreement.
Despite their differences on the tripartite deal, these forces must find a way to unite around two major focuses, in order to address the root problems of industrial farming today.
First, animal production must be drastically reduced. It emits large amounts of methane and nitrous oxide into the atmosphere, contributes to nitrogen runoff that pollutes rivers, lakes, and marine ecosystems — and is, all in all, an extremely inefficient method of producing food. While Denmark’s industrial farming sector produces enough protein to feed approximately sixteen million people, the soybean meal it imports contains enough protein to meet the needs of around twenty-three million people. Hence measured in terms of protein balance, Denmark’s agriculture, centered on animal products for export, effectively produces food for negative seven million people.
Second, the tripartite deal highlights the political and organizational power of Denmark’s landowning farmer class. A few thousand farmers control almost all agricultural land and a significant portion of the country. For these landowning capitalist farmers, farmland must generate as much profit as possible. Although it is an inefficient way to produce food, stall-based industrial animal farming remains profitable for big farmers who benefit from substantial subsidies and are heavily invested in the export-oriented production system. Since the 1960s, this profit-driven logic has spurred massive investments in fixed capital, such as huge stall buildings, technologies, and large-scale machinery, to support ever-increasing levels of animal production for export.
At the same time, the populist and far right should be directly confronted and exposed for supporting farming policies that depopulate rural areas and cause extensive damage to our common natural environment and climate. Instead, a left-wing, green response should confront the concentration of farmland which is driving the ecological collapse.
For the last seventy years, the concentration of Danish farmland in the hands of a few thousand landowning capitalist farmers has separated the vast majority of the population from the land, food production, and the animals confined year-round in massive stall buildings both day and night. However, the effectively landless majority has an obvious interest in how the land and soil is managed and for what purpose. As agriculture’s share of greenhouse-gas emissions continues to rise, private ownership of land increasingly becomes a key obstacle to addressing the planetary crisis.
Denmark’s parliament recently passed a so-called tripartite green deal, agreed between the agricultural lobby, trade unions in the agricultural and food sector, and the Danish Society for Nature Conservation. Especially attracting international attention is its promise to implement a carbon tax on agriculture and turn 15 percent of agricultural land into forests and natural habitats. The new minister responsible for the deal fed the hype, claiming that “Danish nature will change in a way we have not seen since the wetlands were drained in 1864.”
The tax signals a shift in climate policies, which have long evaded dealing with agriculture’s contribution to global warming. Understandably, the primary focus has been on the leading cause of the planetary crisis: the fossil industry. However, agriculture and food production are deeply intertwined with fossil industries and infrastructure. They directly emit potent greenhouse gases such as methane and nitrous oxide, many times stronger than carbon dioxide.
Today, food and agriculture account for at least a quarter of global emissions. In Denmark, however, this share exceeds one-third, and rising. It is Danish agriculture’s focus on animal production for export that makes it especially inefficient. To sustain its substantial pig meat and dairy exports, it relies heavily on protein-rich fodder, which requires significant land use in other countries. It produces less protein than it consumes. As the nation with the highest number of pigs per capita worldwide, Danish farming also pollutes waterways and marine ecosystems through nutrient runoff caused by the application of animal fertilizer.
Simultaneously inefficient and environmentally detrimental, Danish farming contributes minimally to employment (around 2 percent of the workforce) and holds negligible economic importance. In every respect, it is unsustainable. Yet, the new tripartite green deal takes it for granted that its focus on animal production for export must remain locked in place.
The Politics of Carbon Taxes
The carbon tax has been in the works for some years now. The former Social Democratic government created a committee in 2021 tasked with providing a proposal for a potential carbon tax on agriculture. The committee’s proposal was only presented in February 2024. In the meantime, the tax became a hot topic, reshaping the existing political dynamics.
For left-wing and green parties like the Red-Green Alliance, the Alternative, and the Socialist People’s Party, the goal was a tax high enough not only to reduce greenhouse-gas emissions in the short term but also to prompt a structural shift. These parties and others favor a shift from intensive animal farming toward more plant-based food production.
On the far right, the relatively new Denmark Democrats, led by Inger Støjberg — previously sentenced to two months in jail by the Court of Impeachment for misconduct in office after separating families in migrant centers — capitalized on the carbon tax debate to fuel a rural-urban divide. In recent years, the Denmark Democrats have gained significant traction at the expense of the former leading party on the Right, the Danish People’s Party.
Following the carbon tax proposal, the Denmark Democrats launched a loud campaign arguing that industrial pig and dairy farmers must be allowed to continue polluting the atmosphere to preserve jobs and sustain rural communities. This rallying cry is in fact baseless: the concentration of farmland caused by the industrialization of pig and dairy farming has itself depopulated rural areas for decades.
The new coalition government, composed of the Social Democrats, the liberal Moderates, and the traditional liberal farmers’ party — called the Left for historical reasons — faced significant internal disagreement over the rate of the carbon tax. To address this, the government invited the agricultural lobby, trade unions in the agricultural and food sector, and the Danish Society for Nature Conservation to negotiate a tripartite deal that could be presented to and hopefully passed by parliament.
By ensuring support from both the major agricultural lobby organization and Denmark’s largest and oldest environmental organization, the coalition government sought to secure both internal consensus and parliamentary approval. Negotiations proved fruitful, and the tripartite deal was presented in June. After several rounds of discussions, it was approved almost verbatim by a parliamentary majority this month, amid widespread applause.
During negotiations, it became evident that the Danish Society for Nature Conservation and the agricultural lobby could not agree on the carbon tax alone. Additional measures were required to secure a compromise, leading to the inclusion of a land-use reform. As a result, the final deal included a commitment to convert approximately 15 percent of Danish farmland into forests and natural habitats.
On the Right, the Denmark Democrats and the Danish People’s Party withdrew from negotiations early on. On the Left, the Socialist People’s Party supported the final deal despite having campaigned against the industrial agricultural lobby, while the Red-Green Alliance and the Alternative left the negotiations, arguing that the agreement fell short of guaranteeing sufficient reductions in greenhouse-gas emissions and nitrogen runoff. Consequently, the deal has driven a wedge between left-wing and green opposition parties, weakening their ability to form a united front for meaningful agricultural reform.
Butter and Bacon
Indeed, a transformation of industrial animal farming in Denmark is urgently needed. However, the current deal risks entrenching Danish agriculture further into unsustainable industrial animal-farming practices, which, in just a few years, are expected to account for over half of the country’s total greenhouse-gas emissions.
To understand this, we need to take a brief look at the structure of Danish farming. Since the late nineteenth century, it has been heavily oriented toward animal farming for export. By establishing cooperative dairies and slaughterhouses, Danish farmers secured a lucrative trade producing and selling butter and bacon to the British market. Although export markets have since shifted and farmers have specialized, animal production for export remains Danish agriculture’s primary focus.
Today, only about 6,000 highly industrialized full-time farms exist in Denmark, specializing in pig or dairy production. The average farm cultivates roughly 270 hectares of land, while, for example, the average pig farm produces nearly 28,000 pigs annually. However, these averages obscure the true concentration of Danish farming: just 20 percent of farms account for around 80 percent of the sector’s total turnover, and only 30 percent of farms account for 70 percent of agricultural land.
Industrial animal farming dominates agricultural land use in Denmark, covering 60 percent of the country. Major crops like barley, wheat, and maize are used almost exclusively as fodder. The sheer volume of imported soybean meal used in animal feed requires land in other countries equivalent to roughly a quarter of Denmark’s total agricultural area.
Obviously, such an intensive system of animal production emits significant amounts of greenhouse gases. The digestive processes of millions of animals in industrial stall systems release large quantities of methane, while the storage of thousands of tons of slurry emits both methane and nitrous oxide. Furthermore, cultivating millions of acres for fodder crops produces nitrous oxide emissions when slurry and commercial fertilizers are spread on the fields.
The new carbon tax on Danish agriculture targets the first two processes: emissions from animals and slurry management. However, the major agricultural lobby organization played a crucial role in the negotiations over the deal, ensuring that it would be too small and implemented too late to have a meaningful impact.
The tax will be phased in gradually between 2030 and 2035. Many news outlets have reported that it will start at $43 per ton of CO2-equivalent, rising to $107 by 2035.
However, Denmark’s industrial farmers secured a much more favorable deal. They will receive a substantial discount and will not be taxed on the first 60 percent of their emissions. This discount means that if an industrial pig or dairy farmer reduces emissions by 40 percent before 2030 — such as by installing a biogas facility — they will effectively pay no tax. Officially, the effective tax rate after the discount will be only $17 per ton of CO2-equivalent in 2030, rising to just $42 by 2035.
The discount is justified by the negotiating parties with reference to the “actual options” available to farmers. The phrase refers to farmers’ options to invest in existing technologies rather than to significantly reduce the scale of industrial animal farming. Reducing animal-based production for exports and confronting large industrial farmers is not considered an “actual option.” So, many polluting farmers will avoid paying anything at all.
Furthermore, the deal includes a wide range of subsidies for technologies such as methane-reducing feed additives and biochar, as well as reductions in other taxes affecting the pig and slaughterhouse industries. In other words, the carbon tax is deliberately designed not to promote a structural shift from animal-based to plant-based food production. Instead, it incentivizes farmers to invest even more capital in technologies that further intensify stall-based animal production.
Land-Use Conversion?
While the deal assumes that the carbon tax will have some impact on reducing greenhouse-gas emissions, much of the reduction is expected to come from converting farmland into forests and natural habitats, as well as farmers incorporating biochar into their fields. By heating biomass under oxygen-free conditions, biochar is produced that can potentially be used to store carbon. However, biochar is currently an unreliable technology with possible negative environmental and health effects — making the projected reductions from its use highly speculative.
The deal aims to convert around 250,000 hectares of farmland into new forests and to transform 140,000 hectares of cultivated low-lying soils into natural habitats. This is primarily the result of demands from the Danish Society for Nature Conservation. For the majority of these hectares, however, there is no mechanism to ensure their actual conversion. The subsidy rate for converting farmland to forests is calculated from the least valuable soils, leaving almost no incentive for most farmers to sell when they can continue to profit from business-as-usual. What would motivate a large industrial pig or dairy farmer — who has just received increased subsidies and invested even more heavily in new buildings and technologies — to sell off large portions of the fields needed to feed their animals?
The deal does include a mechanism for some of the low-lying soils to address both greenhouse-gas emissions and nutrient runoff. Intensive animal production not only emits greenhouse gases but also contributes to nitrogen runoff into rivers, lakes, and coastal waters. Nitrogen runoff has caused significant problems with eutrophication in Danish marine ecosystems over the past several years.
Aside from a negligible tax on low-lying soils ($5 per ton of CO2-equivalent), it is expected that new regulations on nitrogen application to fields could be enforced from 2027. If implemented, nitrogen regulation would be the only mechanism capable of genuinely incentivizing farmers to sell off some of their farmland. However, it remains entirely unclear how strict these regulations will be or how much agricultural land they will affect. Regulations on nitrogen fertilization for the remaining farmland may possibly become even more lenient. Much will depend on future political negotiations, made yet more difficult by the split within the broad left-wing and green camp.
In short, the design of the carbon tax will further intensify stall-based production, locking agricultural producers even more deeply into unsustainable industrial animal farming. There is no mechanism to ensure the necessary reductions in greenhouse-gas emissions or nutrient runoff. Instead, large-scale industrial farmers will receive even greater subsidies and be able to claim they are “climate-smart” while continuing business as usual.
Fighting Landowner Power
Still, business as usual will surely be challenged in the near future. Denmark has committed to achieving net-zero emissions by 2045, supported by a large political majority. By that time, agriculture will likely account for well over half of Denmark’s total emissions. Consequently, by further entrenching agricultural producers in an unsustainable system of industrial animal farming, the deal sets the stage for a new wave of conflicts over farming policies in the coming years.
Because of the deal, however, left-wing and green opposition parties will be unable to form an alliance to push for the needed reforms. The situation is further exacerbated by the split between the Danish Society for Nature Conservation, which supported the original deal, and nearly all other green civil society organizations — such as the Green Youth Movement, the Climate Movement, Greenpeace, animal rights groups, and the sizable association of organic producers — who have been highly critical of the agreement.
Despite their differences on the tripartite deal, these forces must find a way to unite around two major focuses, in order to address the root problems of industrial farming today.
First, animal production must be drastically reduced. It emits large amounts of methane and nitrous oxide into the atmosphere, contributes to nitrogen runoff that pollutes rivers, lakes, and marine ecosystems — and is, all in all, an extremely inefficient method of producing food. While Denmark’s industrial farming sector produces enough protein to feed approximately sixteen million people, the soybean meal it imports contains enough protein to meet the needs of around twenty-three million people. Hence measured in terms of protein balance, Denmark’s agriculture, centered on animal products for export, effectively produces food for negative seven million people.
Second, the tripartite deal highlights the political and organizational power of Denmark’s landowning farmer class. A few thousand farmers control almost all agricultural land and a significant portion of the country. For these landowning capitalist farmers, farmland must generate as much profit as possible. Although it is an inefficient way to produce food, stall-based industrial animal farming remains profitable for big farmers who benefit from substantial subsidies and are heavily invested in the export-oriented production system. Since the 1960s, this profit-driven logic has spurred massive investments in fixed capital, such as huge stall buildings, technologies, and large-scale machinery, to support ever-increasing levels of animal production for export.
At the same time, the populist and far right should be directly confronted and exposed for supporting farming policies that depopulate rural areas and cause extensive damage to our common natural environment and climate. Instead, a left-wing, green response should confront the concentration of farmland which is driving the ecological collapse.
For the last seventy years, the concentration of Danish farmland in the hands of a few thousand landowning capitalist farmers has separated the vast majority of the population from the land, food production, and the animals confined year-round in massive stall buildings both day and night. However, the effectively landless majority has an obvious interest in how the land and soil is managed and for what purpose. As agriculture’s share of greenhouse-gas emissions continues to rise, private ownership of land increasingly becomes a key obstacle to addressing the planetary crisis.
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