Is it all doom and gloom and where are the opportunities?

Jeremy Clarkson’s new television series Clarkson’s Farm is doing a fantastic job of getting the message across to the general public that farming is not easy…. and, in renaming his farm ‘Diddly Squat Farm’, the programme is also outlining the bleak financial returns that farmers are facing.

Is it all doom and gloom and where are the opportunities?

The Doom and Gloom

The stark reality that by 2024, farmers will lose circa. 50% of Basic Payment subsidy hangs over every business. We still await the news on how this will be further reduced from 2024 and the replacement Environment Land Management scheme (ELMs). The predictions this week that farmer numbers are due to fall 20% in the next 10 years does not fill us with confidence that ELMs will be the answer!

Whilst commodity prices and livestock prices remain strong, the jury is out on whether or not this is masking over artificial cracks in farm business finances or whether this is the direction of travel as populations grow and land supply decreases.

All this leads to a great deal of uncertainty in the agricultural sector. A sector which has been in this period of uncertainty since well before Britain voted to leave the European Union 5 years ago.

However, there are opportunities and we outline below just a few of the more topical opportunities at the current time:

Opportunities

  1. Countryside Stewardship and ELMs

Countryside Stewardship and ‘public money for public goods’ is clearly the direction of travel. This can be seen in the Countryside Stewardship offerings which provide Capital Grants and annual payments for specific purposes such as protecting water quality or wildlife areas.

Within the first few pages of the Countryside Stewardship Manual is a pertinent line, ‘Signing up to a Countryside Stewardship Agreement now will put you in the best possible position to join the Environment Land Management scheme’. As we await further details on ELMs and the rewards this scheme will offer to farmers, embracing the Countryside Stewardship scheme would seem a good place to start!

  1. Other Environmental Opportunities

Biodiversity Net Gain has been a buzz-phrase recently. The concept is that the loss of biodiversity through development is no more and ecological networks are restored. It is an approach to development that leaves biodiversity in a better state than before. Where a development has an impact on biodiversity, it encourages developers to provide an increase in appropriate natural habitat and ecological features over and above that being affected. These areas will not necessarily be within developments but could be on nearby land with attractive agreements offered to farmers or landowners to provide and manage these areas.

Again, the concept is in its early stages with trials currently taking place within local councils. It does however look likely that this will shortly be a mandatory requirement of the planning system and opportunities will therefore be available.

  1. Making your assets sweat!

Now is the time to take a good look at the farm to ensure that every building and every bit of land is used to the best of its ability.

Over the last 10 years, we have seen a huge increase in diversification on farms and we expect this trend to continue for a number of reasons:

  • Tourism – The Great British public’s obsession with the countryside has only heightened over the last 18 months. From pick-your-own sunflower fields to Shepherd Hut accommodation. The rise of the staycation offers numerous opportunities for rural tourism.
  • The mass exodus out of towns and cities that occurred during the pandemic offers further opportunities for farmers with rural office space/ workshops in hot demand.
  • Direct to consumer sales are on the rise. Be it meat, milk or eggs, the demand for items direct from the farm is booming. Farm shops, as an example, have enjoyed surges in demand over the pandemic period.
  1. Renewable Energy

Renewable energy is pivotal to the Government’s net-zero ambition. The COP26 Conference in Glasgow this November is likely to put this in sharp focus. The opportunities for farmers are restricted due to the availability of a grid connection, and because of the grid’s insufficient capacity, these opportunities will not be available to everyone. However, the appetite for large solar parks and battery sites is currently strong and we expect further opportunities in this sector in the coming years.

Let’s embrace the change to ensure Grange Farm’s up and down the county aren’t renamed Diddly Squat!

 

Johnny Cordingley MRICS FAAV

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