2023 has been a strong year for Stephensons Rural and Boulton & Cooper in terms... Read more
Reflections on 2023
Its not been an easy journey travelling through 2023 and here are my milestones upon which to reflect.
BPS Demise Starts to Bite
Levels of support through BPS have generally dropped to around 50% of their historic level and the cold wind of change is starting to be felt in farming businesses.
Samuel Johnson first declared that the prospect of hanging concentrates the mind and indeed the vanishing BPS pay packet has stimulated huge interest in the replacement support schemes headed by the Sustainable Farming Incentives being drip fed from the RPA. If you haven’t done so already, all clients should be sifting through the SFI options to see if you can boost receipts without adversely affecting your farming operations. Chris Muir and Chantelle Astley are our Environmental Team colleagues.
Challenging Interest Rates
It was only 2 years ago, in late 2021, that bank interest sat at 0.1% per annum and has now just plateaued out at 5.25% which has resulted in our loan charges quadrupling in many cases.
This has already, and will continue, to force many businesses to review their borrowings and re-set the clock to live within ones means.
Happily, the land market is mainly unaffected and provides an opportunity to get back in funds. We are happy to discuss with anyone wanting to reappraise their borrowing strategy.
The Rise and Rise of Green Energy
The last 12 months has seen swathes of blanket postcode bombing of clients with irresistible offers to put their land aside for solar, battery storage and wind turbines.
Sad to say most come to nothing but the pot of gold at the end of the energy rainbow is often so attractive that it has to be pursued even if the result is disappointment.
Johnny Cordingley has specialised in the energy market and is available for an initial free consultation.
The Impact of War
The tragic suffering of those in Ukraine and now in the Middle East has had inescapable consequences for British agriculture.
The grain and fertiliser markets have been as unpredictable as the weather with highs of over £300 per tonne for wheat in the spring but counter-balanced by fertiliser at £800 per tonne.
Those selling forward with grain will be smug but those buying forward for fertiliser will have been out of pocket.
It is not a market anyone takes pleasure from.
Stability of Land Prices
The land market has managed to keep its head when all others around it are losing theirs and demand continues to be strong.
The better end of the arable will be hovering around £9-12,000 per acre with some special cases hitting highs of £15-16,000 per acre.
At the other end of the scale, you find permanent grassland sticking around £5-7000.
Price is very often steered by location and people; and our team is on hand to advise how best to face the market.
Musical Chairs and The Ministers
I often hark back to Michael Jopling who was our last proper Minister of Agriculture and recently there has been increasing activity in the game of musical chairs in the government. The reign of our DEFRA Minister George Eustice came to an end in 2022 to be followed by Theresa Coffey staying for 12 months and then Steve Barclay being appointed.
I do hope that Mr Barclay reconnects with farming as we desperately do need somebody to represent us in the corridors of power. Food Production used to be the beacon of Environmental Policy but has now been consigned to taking a back seat behind rewilding!
Rain, Rain Go Away
It has been a year when the weather has behaved in a perverse fashion – drying out when we wanted germination and pouring down when we were trying to harvest.
Sadly, there will be a lot of winter sown crops that will need knocking up and replacing in the spring with all its associated extra cost.
A very happy Christmas and prosperous New Year.
James Stephenson MA (Cantab) FRICS FAAV
Tel: 01904 489731
Review of 2023
YAMS – WEDNESDAY 7TH FEBRUARY 2024 – A MESSAGE TO ALL OUR CLIENTS
As YAMS celebrates its 10th anniversary, the team at Stephensons Rural look forward to welcoming... Read more