Gaining insight on the effect of policies upon the agricultural domain is essential for policy makers, famers and the agribusiness sector. A variety of models have therefore been developed that enable a prediction of agricultural development under different policies. Most models do however not make predictions on a fine grained level and are weak in accounting for specific factor market and resource constraints farmers (agents) face at farm level. The paper presents an agent-based model where each farm is modeled by means of an agent and studies the effect of milk quota abolishment. Two simulations policy simulations are made: 1) abolition of the milk quota; and 2) land-tied sustainable dairy scenario. Outcomes are analyzed and compared with the predictions of sector models.