Farming feature: farmers armed with capital and technical expertise will prevail, experts predict
PUBLISHED: 14:45 08 February 2018
East Anglia’s land agents see farming evolving further into a highly professionalised industry with a high degree of technical expertise. Sarah Chambers reports on their predictions for farming in the mid-2020s and beyond
Technical expertise and capital will be among the armoury possessed by a dwindling number of East Anglian farmers running successful agricultural businesses by the mid-2020s, land agents predict.
They see cuts in farm subsidy leading to a continuation of a trend towards larger farm businesses, which are professionally-run, efficient and staffed by trained and motivated employees.
Farmers will need to be proactive, and those who set themselves apart by creating strong brands or growing unusual crops will have more chance of making the grade. Collaboration will be key. Some smaller players will need to supplement their incomes with jobs outside of farming, and more will let out their land.
Martin Freeman of Fenn Wright is sceptical of environment secretary Michael Gove’s prediction of an agricultural revolution, but believes change is definitely on the way.
“Change may be welcome by many, but revolution is probably too strong a word for what Mr Gove has in store, which is the changing of the existing environmental regulations and farm subsidies,” he says, adding that: “Continuous cropping and heavy herbicide use in particular in the arable regions of East Anglia have led to the rise of herbicide-resistant weeds, such as black grass, leading to significant yield losses.”
Gove or his successor will focus on environmental benefits in the future, he suggests.
And farmers with technical expertise, who are forward thinking and have the capital to invest are likely to be farming larger holdings with the result that more farms are likely to contract farmed or subject to farm business tenancies, he predicts.
Other smaller concerns which carry out environmental work will continue, but for some it may mean supplementing the farm income with jobs outside of farming.
Others which are well located and have suitable assets will turn to further diversifications, and, if climate change does begin to affect the region sufficiently, farmers may look to vineyards, specialist pulses and other crops.
Alex Bragg of Savills says the move towards benefiting ‘natural capital’ had been made clear in Gove’s Oxford speech.
“Mr Gove omitted talking about farm income, where farming incomes come from and what percentage of that income is from subsidies under the current regime. We therefore don’t expect there to be any sort of area-based payment as a top-up to farming incomes in the mid to long term.
“He did, however, major on the Government’s willingness to support the funding of efficient use of technology and data sharing to help boost productivity.”
Those farmers who adopt the most efficient and productive technologies and farming systems will prevail, he predicts, but whether they are large scale ‘super farms’, or smaller robotic-driven units has yet to be seen.
Labour will be a key issue, with one of the biggest medium-term risks the supply of a trained, motivated and forward-thinking labour force.
“Businesses will have to stand out to attract the best people but, for some, a sea change in thought will be the biggest test,” he says, adding: “Those who can market themselves and their produce better than their neighbours will also be better placed post 2020.”
Jason Cantrill of Strutt & Parker foresees larger professional farming companies who either crop land in their ownership, land that they rent or provide contract services to other farmers coming increasingly to the fore.
“These businesses will be managed by proactive and forward-thinking individuals who are adaptable and embrace change and the challenges faced,” he says.
These may take the form of joint ventures in which smaller farming businesses come together to share labour and machinery to reduce fixed costs. He also sees more landowners opting to let their land.
“The ability of the larger professional farming companies to utilise large, modern and highly technologically advanced machinery will enable them to also take advantage of economies of scale,” he says. “They will then be in a position to take advantage of opportunities that arise and further expand their businesses and farmed area, whilst delivering an efficient and lower cost service to recipients than the owner occupier farmer may be able to achieve themselves.”
William Hosegood of Brown & Co believes there will be little difference in the make-up of people running farms in the mid-2020s, but thinks there will be fewer of them.
“Changes are likely to be seen after the industry has adjusted to any change to the UK agricultural policy and the effects of operating outside of the EU and the challenges that that may bring,” he says. “Beyond the mid 2020s we are likely to see professional farmers and farming businesses running farms but fewer of them as a result of collaboration.Collaboration is likely to be driven by tighter margins and the need for farming businesses to find ways to cut costs to mitigate the effects of reduced returns from any subsidy system changes.”