When neighbouring farmers become partners

Joining forces to run two family farms: Konrad Krummenacher and Fredi Lustenberger,from left to right

Every day three farms disappear in Switzerland, because they are no longer profitable or because there is no one to take them on. Many descendants of farmers feel a strong sense of commitment. Group farming offers a way out of the dilemma.

This content was published on November 21, 2013 - 11:00

The two farms in Hasle outside Lucerne are only a few metres apart. The Lustenberger and Krummenacher families were never particularly close. They respected each other and when needed, lent a helping hand. They waved to each other occasionally and the children often met on the way to school.

In the end, there were 14 cows at Ennetemmen on the Krummenacher farm, and 18 on the Lustenberger’s Höchhus. On both farms, milk production was the mainstay.

They’re located in so-called Mountain Zone One, where production conditions are difficult compared to the valley regions and it still takes hard physical labour to mow, make hay and look after the sheep, because the meadows are so steep in places that they cannot be worked with machines.

In both families, all generations regularly lent a hand, even the children – the Krummenacher’s seven and the Lustenberger’s three. "You were on the job 365 days a year, often 14 or 15 hours a day.

“Sometimes you could take a few hours off on Sunday. But that was it," says Fredi Lustenberger. The experienced farmer is 50 years old, next year. None of his children are keen to follow in their father's footsteps. The older son is a car mechanic, the daughter and younger son work for the social services.

"How long I can go on alone? Sooner or later, I won’t have the strength any more. But who would want to take over an operation that demands endless work days and doesn’t provide leisure time or holidays?" Thoughts about the future surfaced more and more frequently.

The youngest

Krummenacher’s children have long since been independent apart from the youngest. Even Konrad first trained to become a butcher but when his older brother showed no interest in taking over their parents’ farm, he was ready to step in.

After a secondary education at the agricultural vocational school, the then 24-year-old felt ready in January 2010 to shoulder the responsibility.

But for Konrad, it wasn’t simply a question of taking over the reins. The stables no longer met new animal welfare regulations so he was faced with a hefty investment. "These days with only 14 cows it is almost impossible to cover your costs," says Konrad reflecting on the past.

"When Fredi asked me one day asked what was going to happen, the idea suddenly came of merging the two neighbouring farms. Talks with experts followed, with the trustees, with lenders and above all, with each other.  "We discussed strategies, examined and counted our numbers, over and over again."

Since 1 May 2010, Fredi and Konrad have been partners. There was no feast to mark the inauguration of the cooperative. "We were working."

They estimated the value of the land, buildings, machinery and animals, which they jointly operated. Everything was contractually agreed as far as possible, even the question of what would happen when the partnership came to an end.

"Ultimately it is a question of character and trust," says the older of the two, who was used to deciding everything himself. “You have to rethink. You have to take the time to discuss and develop projects together."

Decline of Farming

In 1990, Switzerland had around 100,000 farms. Today there are still 56,500. Last year more than 1,000 farms disappeared.

The number of organic farms has remained fairly constant in recent years. In 2012, 5,731 farms operated according to Bio Suisse guidelines, about 500 less than in the peak year of 2005.

The area of land used for agriculture has only marginally diminished in this period. Farms average about 18.6 hectares today. In 2000, they were only 15.2 hectares.

The price of milk has contributed to the decline of farming. Since 2000, it has fallen by more than 20%.

As part of its agricultural reform policy, the government is paying no more animal-based subsidies from 2014.

Government contributions for animals in the cowshed had created incentives to intensify animal husbandry and led to ecological problems.  As of New Year's Day area-based contributions will be paid, which strengthen the security of supply.

Agriculture is the biggest recipient of subsidies in Switzerland with contributions totaling CHF3.7 billion.  Every farm receives an annual average of 65,500 francs.

(Source: Federal Statistics Office; Agro News)

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Different strokes

"There were some [disagreements],” says Konrad frankly, "for example, in terms of animal husbandry. Fredi's strategy was to reduce the milk yield a bit whereas I wanted to breed bigger, dairy animals. In the old, small stables, this would not have been possible.

But larger animals are allowed in the new buildings which have seen CHF 800,000 ($877’650) worth of investment and which comply with animal welfare standards. "The work remains the same, whether the cows give 5,000 or 7,000 liters of milk," argued the young farmer. His partner, from whose experience he has much to learn, gave the go-ahead.

"Konrad has a flair for the cattle," says Fredi, who describes himself as a more ecologically-inclined farmer which has its own drawbacks.

"I love the fruit trees which Konrad would rather get rid of because they get in his way when he’s mowing.”

Both men insist that talking is the be all and end all. If one feels he is getting a raw deal, he raises the subject. In operational matters there should be no taboos.

After 40 months of experience with the partnership, the two are optimistic. “The first set of accounts show that it could work," says Fredi, who is responsible for bookkeeping.

On to Canada

The number of animals has grown to 36 cows, 11 bulls and six calves. The two partners carry out the milking and herding together.  If Fredi arrives in the stable after five in the morning, Konrad is already there, even if they have not explicitly agreed a time to start work.

If need be, he can also handle most of the work alone - at least for a time.  Other farmers would envy the fact that the two partners now occasionally have time for non-farm tasks or even to devote to their hobbies.

Fredi attended all three days of the National Swiss-style Wrestling Championship and when he went off for a days hunting, his young partner had to cope alone.

Just to have the certainty that the farm is in good hands, does him good, also with a view to the future. "One day I will have to or want to hand over everything.  All the more reason why it is important to keep a bit of distance every now and then,” says Fredi.

The younger one is also finding time to distance himself. At the end of September for the first time in his 27 years, he’s traveling on holiday for more than two or three days.  Four weeks in Canada. What farmer working alone can afford such a break?

Group farming

In Swiss agriculture, there are 909 group farms and 648 farms run as business communities. 

"More and more farmers accept a loss of autonomy as a trade off for less stress,” says Anton Moser, teacher and consultant at the Nature and Nutrition vocational training centre in Schüpfheim.

For a partnership to be useful depends on its structure and the geographical distance between farms. But equally decisive is the ability of the managers to cooperate. 

For dairy farms, the animals should be housed in one place to allow for synergies and rationalisation.  In the milking parlour, you only need one set of facilities like    feeding stall, crane and hay ventilation, whether you have 20 or 40 cows.

Moser recommends the merger be carried out so that the partnership leases the two former businesses.  For the plots of land, buildings, machinery and animals, the partners receive appropriate rates as well as a wage for the work they perform on the farm.

If the partnership is set up well, returns on investment tend to be somewhat higher. "With bigger units the structural costs decrease. At the beginning the planning takes up a lot of time. But once the whole thing is up and running, there is also administrative relief (only one set of bookkeeping),” says the agriculture expert.

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