services 'Roadmap' seeks to supercharge farming transition

'Exciting future' for UK agriculture

Experts say four recommendations could encourage more farmers to adopt practices that are good for their businesses as well as for the environment.

The independent farming, finance, and agrifood strategic working group was commissioned by Defra to find ways that will accelerate private investment as more farmers transition to low-emission and nature positive production methods.

A number of barriers mean the private sector is reluctant to invest in the switch to a greener future, says the group's Financing a Farming Transition report. Those barriers include lack of data and low confidence.

The report sets out four recommendations to overcome these challenges (see panel). It says adopting these measures could rapidly unlock private sector finance – encouraging food production and environmental improvements while diversifying farm incomes.

Farmers need greater financial support to deliver a resilient and secure food system while meeting the UK’s

Report pinpoints potential sources of investment

Banks are exploring the potential for discounted loans to farmers who meet environmental outcomes –helping to cover the cost of the transition. Lenders are looking to support natural capital projects, with some banks keen to supply measurement and monitoring tools.

Supermarkets and food manufacturers are exploring premium payments for farmers who measure and reduce greenhouse gas emissions.

Buyers of ecosystem services are seeking to pay farmers for carbon improvements, habitat creation and flood risk reduction.

ambitious environmental goals – including the creation and restoration of at least 500,000ha of wildlife habitat, says the document.

Hertfordshire farmer and former NFU deputy president Stuart Roberts, who co-chairs the working group, said the environmental benefits provided by growers and livestock producers were becoming more important.

“We are seeing a change that we believe will, in time, place these environmental outputs on an almost equal financial footing with the other farming products.”

Mr Roberts said this opportunity could only be unlocked through transparency in standards, data, monitoring and reporting.

“Delivery of multiple outcomes has the potential to enable an exciting future for UK agriculture – but only if farmers, financiers, supply chain partners and politicians work together to embrace the opportunities.”

Private finance

The report says unlocking sources of private finance to accelerate the farming transition is critical for food, environmental and economic security –as well as for reaching the UK’s net zero goals.

Additional sources of finance are central to diversifying farmers’ revenue streams, it says. They will incen- increase food production while de-

Although the agriculture sec- tor currently accounts for 11% of the UK's greenhouse gas emissions, lack of action could see this proportion increase to 30% by 2030 as other sectors reduce emissions more quickly.

Targets have also been set for 60% of England’s soils to be sustainably managed by 2030, with a 40% reduction of nitrogen, phosphorus and sediment pollution from agriculture into the water environment by 2038.

Defra minister Lord Benyon (below left) said the government would continue to work with farmers and other partners across the private sector to support investment in nature-friendly and productive farm businesses.

Four recommendations

Improving data availability

Better and more accessible data – including free mapping software – would help farmers, banks and the private sector integrate natural capital improvements into businesses and decision-making processes.

Priority environmental outcomes

A clear vision from the government – including outcomes for soiul, water and biodiversity – would help the private sector and farming community know where to invest their time and resources.

Market clarity and guidance

Greater clarity and formal guidance on high-integrity environmental markets – including standards and details on the tax treatment of ecosystem services – will provide confidence for investment.

Aggregation model support

Better support – including funding and a community of practice – will encourage landscape-scale environmental improvements and greater capacity for farmers to attract private finance.