Agri View Winter 2016

Rural update from fishergerman.co.uk

Improving performance: quality is key

Winter 2016

02 Welcome

From David Merton

03 Kedleston Estate

A case study of development

04 Farmland market The Brexit impact on values

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06 Benchmarking

10 Model farm

14 Winning ways

Audit your farm’s performance with our in-depth analysis

Sheep, crops and other business down on the virtual farm

08 Changing role

13 Harry’s view

The results of the 2016 Rural Business Awards plus news of the next Nuffield Conference

How the Edmondthorpe and Barkby Estates have evolved

What Brexit could mean for the future of agriculture

15 Meet the team Introducing key personnel

31/10/2016 09:28

Fisher German Agri View

Welcome The Brexit legacy, tales of two estates, benchmarking and a virtual farm… welcome to our third edition of Agri View

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David Merton Head of Rural Sector, Fisher German LLP 07770 333331 david.merton@fishergerman.co.uk

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also created a virtual farm to model different business dynamics and scenarios often faced by real farms.

We know how important it is to bring creativity and innovation to rural businesses while respecting traditional estate management values. John Palmer has been involved with the Edmondthorpe and Barkby Estates since he joined the firm in 1985, and in this issue he talks to us about how his role and the Estates have developed over this time.

On the Kedleston Estate in Derbyshire, we highlight a recent planning success that will enable high quality housing to be provided on the edge of Derby.

We also give our thoughts on the outlook for the land market, as with weakened demand, land prices continue to come under pressure; location and quality of the land remain key to a successful sale.

I hope that you enjoy reading this latest edition of Agri View.

Front cover image: iStock Back cover image: Getty

hile Brexit has been the immediate focus in recent months, changes offer massive opportunities to the UK rural sector for improved efficiencies, a more favourable export market and rationalisation.

In this issue of Agri View, our chairman Harry Cotterell gives his views on the challenges facing the Government.

Some rural businesses will see the changes as an opportunity to compete fairly in an international market without the burden of regulation, administration and tariffs imposed by the EU. For others, particularly dairy and intensive livestock, this might be true but the structure of UK agriculture as a whole is still very inefficient compared to our competitors and the freeing up of trade may well represent a threat rather than an opportunity.

As the 2016 harvest shows, modest yields, knowing costs of production and taking advantage of spikes in the market is important. In this issue, the Fisher German farms team have provided benchmarking data to enable a comparison to your own business, so you can audit your performance. The farms team have

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31/10/2016 09:33

Case study / 2016

Grand designs for development The owners of historic Kedleston Estate in Derbyshire have been given the perfect opportunity to make a significant contribution towards local housing needs isher German took over the management of the Kedleston Estate in Derbyshire in April 2013 and was immediately struck by an opportunity for a large housing development on land forming part of the Estate bordering Derby city.

The Estate as a whole extends to approximately 4,044 acres, of which 40 acres was considered ripe for prime residential development. Neil Hogbin of Fisher German, who manages the Estate on behalf of the family, says, “Upon taking over the management of the Estate, we immediately set about reviewing options for the proposed development site.

“With the support of both the Fisher German planning and development teams, we provided advice to the owners of the Estate on the various options for the site and it was decided to enter into a promotional agreement with Catesby Estates Limited.”

Work then began to submit a planning application for 400 houses.

Given the significant scale of the proposed development, a wide range of reports and technical documents were instructed to support the planning application. In particular, the site’s proximity to the Grade I listed Kedleston Hall and registered park and gardens required careful consideration to be given to the setting of the site.

A planning application was lodged

by Catesby in spring 2015, but after consideration by the local planning authority (Amber Valley Borough Council), it was refused in the summer

Image: iStock

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of 2015. The authority had concerns with regard to the impact the proposed development would have on the landscape and its proximity to a heritage asset. However, with no local plan in place, the local authority was not in a position of strength, having significantly under provided for housing numbers.

An appeal was immediately lodged by Catesby with the Planning Inspectorate. A new planning application was also submitted in December 2015 proposing a smaller site of about 200 houses over 20 acres, and due to non-determination by the local Borough Council, an appeal for the second application was also submitted to the Planning Inspectorate. It was requested that both appeals be heard simultaneously by the appointed Planning Inspector. In July 2016, an eight-day hearing saw representations made on both sides by both technical and

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legal experts. The Planning Inspector concluded that both of the planning applications should be allowed.

This was an outstanding result for the Estate and their promotion partner, enabling high-quality housing to be provided on the very edge of Derby. The scheme also provides a significant contribution towards local housing needs through the provision of affordable housing and other Section 106 contributions.

Fisher German is now advising the landowner on the best strategy for the site to maximise returns, both in respect of the financial receipt and the best possible terms. The site may yet be subject to a High Court challenge but we have every confidence that the merits of the site will outweigh any concerns raised.

Neil Hogbin Fisher German LLP 07919 693400 neil.hogbin@fisher german.co.uk

03 31/10/2016 12:01

Fisher German Agri View

Farmland market overview

ith weakened demand, land prices continue to come under pressure, commodity markets have affected the range of purchasers in the market place and farm profitability is a worry for those needing to secure finance. Poor farming profitability is now impacting on the land market, with 54% of our surveyors predicting a modest fall in land prices over the next 12 months.

However, a number of institutions and charities remain committed to the market; interest remains from developers and individuals looking to areas where they believe medium to long-term strategic development opportunities exist, bringing with them potential for high windfall land values.

Farmers are still substantial purchasers of land – they are not seen

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as high profile, as the sums involved in individual transactions are so much smaller than those of developers and agri-businesses, but they represent a large proportion of buyers. Some have monies to invest from development sales, others have funds from the basis of a good business model and wish to grow. Some farmers are expanding by trading up through selling and then re-buying better assets.

The usual factors of death and divorce continue to drive sales, but increasingly, financial pressure, particularly in the dairy sector, is resulting in sales. Some are forced to the market as a whole or to downsize through the sale of off-lying parcels. Vendors are holding on for tax reasons, but as lenders look more closely at farming businesses, where cash

KEY TYPE OF PURCHASERS OVER THE LAST SIX MONTHS

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29%

INDIVIDUAL FARMER

11%

AGRI BUSINESS

29%

PRIVATE INVESTOR

7%

INSTITUTIONAL INVESTOR

4%

DEVELOPER

20%

LIFESTYLE BUYER

flow is tight for many, further land may come to the market over the next 18 months, easing supply.

Many PLC companies with large surplus land portfolios that are secondary to their core business – such as developers, house builders, mineral and landfill companies – have been selling down to improve their balance sheets. This has allowed them to raise capital but keep reservations where necessary for their future benefit through arrangements such as sale and leasebacks.

The outlook in the medium term is more difficult to predict. The Treasury has offered some reassurances regarding Government support to 2020, but post-Brexit changes in subsidy could have significant impact on returns and risk, so the outlook is somewhat uncertain.

However, the UK market for land is seen as attractive for many reasons – our political stability and, thus, capital protection, and the UK climate. The ever-growing world population and increasing Asian demand for meats will continue to drive international markets and the need for food security. As ever, markets will become saturated at times and there will be a short-term levelling of price, but market trends are expected to continue to remain positive, with 32% of our surveyors expecting land prices to strengthen in the next three years.

Location and quality of the land remain key to a successful sale. There

Source: Fisher German Rural Index 2016. Percentages include responders who ticked multiple categories

While Brexit has brought uncertainty about the future of agricultural support, the supply of land coming to the market has steadied and demand has declined in some regions

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31/10/2016 09:36

Farmland market / 2016

32%

of surveyors expect land prices to strengthen in the next three years

Image: iStock

“Demand for farm tenancies continues to outstrip supply and, in some cases, premium rents will be paid to secure holdings” are significant regional variations; in very local markets with strong local interest, land prices continue to rise.

In an increasingly difficult market when margins are under pressure, people will pay for quality where poorer parcels would struggle. Supply, and therefore values, are seen to correlate with those sectors of the industry under most pressure; there have been a number of dairy farms marketed in the North and South West.

In urban fringe areas, the market is supported by non-agricultural buyers actively looking to secure strategic land that may have long-term hope value.

Our research indicates that rents are likely to remain steady over the next 12 months, with 50% of our surveyors predicting that there will be

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no change. New lettings and high Farm Business Tenancies are likely to come under the greatest pressure, as lower commodity prices exert pressure and bring down some inflated rental values. This reflects that Agricultural Holdings Act lettings are generally below market rental levels and, therefore, better able to weather the tougher economic rural climate.

Demand for farm tenancies continues to outstrip supply and, in some cases, premium rents will be paid to secure holdings.

Stuart Flint Head of Agency Sector Farms, Estates and Country House Sales 07501 720422 stuart.flint@fishergerman.co.uk

05 31/10/2016 12:02

Fisher German Agri View

Farms benchmarking Brexit has given UK commodity prices a short-term boost. As the 2016 harvest shows modest yields, knowing costs of production and taking advantage of spikes in the market is important

CONTRACT FARMING Fisher German manages a large number of contract farming agreements with farmers employing contractors to undertake some or

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all farming operations on their behalf.

The farmer provides the working capital to purchase all crop inputs and the contractor provides the machinery and labour to carry out the operations.

Contract farming agreements can be structured in different ways, but in the majority the farmer retains the Basic Payment, the contractors receive a fee covering their costs and a share of the surplus is agreed.

This is reflected in the graph below, which shows that even in years with poorer returns – 2013 (lower yields) and 2014 and 2015 (low commodity prices) – returns to the contractor per hectare are above the cost level of operations.

We would place the cost of operations

in a combinable cropping situation between £300 and £380 per hectare.

With marketing of 2015 now complete, the results show that while to an extent low prices were mitigated by high yields, margins for both parties have been squeezed. In these potentially loss-making situations, it is the farmer who is exposed to the risk with many agreements structured so as not to carry any deficit forward into the following season.

The relationship between farmer and contractor is a crucial one, and in our experience Contract Farming Agreements work best, and in both parties’ interest, if a long-term approach is taken.

CONTRACT FARMING AGREEMENT RETURNS PER HECTARE £250

£1,400 £1,200

£200 £1,000 £150

£800 £600

£100

Wheat £/t

While there have been reassurances of Government support post-Brexit as far as 2020, the support regime is almost certain to face radical change, and businesses must be prepared for this.

As the influence of exchange rates dominate, uncertainty over prices will be the norm for some time. The arable sector needs to address this the same way as the pig, poultry and, recently, dairy sectors have done by focusing on reducing the cost of production.

While low crop prices will inevitably reduce production globally, particularly on more marginal land, the desire of many countries to continue to produce in order to maintain domestic food security; the involvement of very large agribusinesses in most grain-producing countries; the large world grain supply overhang and the slowdown in emerging economies all point to a period of oversupply and low prices.

As the world population increases and people’s diets move from grains to meat, consumption and demand will start to impact on prices, giving a positive outlook in the long term.

This won’t be soon enough for most UK businesses to bring about a return to acceptable levels of profitability and they will have to aggressively focus on cost reduction.

£/ha

GLOBAL OUTLOOK

£400 £50

£200

£0

£0 2011

2012

Contractors’ Return /ha

2013

2014

Farmers’ Return /ha

2015 Subsidy /ha

Feed Wheat Value £/t November

WHY BENCHMARK? Comparison of your business to a targeted data set is a useful audit of performance, a tool to aid future strategy and can identify areas of strength and opportunity within your operation.

COMPARE – CHALLENGE – IMPROVE

fishergerman.co.uk

31/10/2016 09:39

Farms benchmarking / 2016

Data adapted from DEFRA – Farm Business Survey

UK ARABLE FARM TURNOVER 2012/13

UK ARABLE FARM TURNOVER 2013/14

UK ARABLE FARM TURNOVER 2014/15

23%

PROFIT

16%

PROFIT

16%

PROFIT

5%

MISC FIXED COSTS

6%

MISC FIXED COSTS

6%

MISC FIXED COSTS

10% 7% 16% 4% 35% 48% 52%

PROPERTY COSTS RENT AND FINANCE POWER & MACHINERY LABOUR VARIABLE COSTS PROFIT (OPERATIONAL) PROFIT (SUBSIDY)

UK FARMING PLC The breakdown analysis of turnover on the average UK arable farm shows that for both years ending April 2014 and 2015, subsidy payments provided the lion’s share of profit.

It is vital that all businesses examine their power and machinery costs to ensure they are striking the correct balance between conducting farming operations in a timely and competent manner without trying to meet a cost that the farm cannot sustain.

This may well lead to farmers electing to contract out some or all of their arable operations. We would hope to see power and machinery represent no more than 25-30% of a businesses turnover.

The high wheat prices of 2012 had a positive impact on the profitability of

11% 8% 18% 5% 36% 24% 76%

PROPERTY COSTS RENT AND FINANCE POWER & MACHINERY LABOUR VARIABLE COSTS PROFIT (OPERATIONAL) PROFIT (SUBSIDY)

the average UK arable farm. A fall in prices in 2013/14 and 2014/15 is shown above, with operational profit making up only around 24% of turnover in both seasons. With even lower commodity prices in 2015/16, there will be several loss-making arable enterprises.

Whether tendering for rented land as a prospective farmer or setting rent as a responsible landlord, arriving at a level that is realistic and sustainable is important for long-term success and protection of the land asset. Rent expenditure should not contribute more than 30% of the turnover of any prospective addition to your land area. Variable

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11% 8% 18% 5% 36% 23% 77%

PROPERTY COSTS RENT AND FINANCE POWER & MACHINERY LABOUR VARIABLE COSTS PROFIT (OPERATIONAL) PROFIT (SUBSIDY)

costs account for a third of the turnover of the average UK cereal farm. In the majority of intensive cereal growing situations, particularly where blackgrass is present, the cost of growing arable crops is significant and becoming less variable. Crop input costs for winter wheat are averaging in the region of £450/ha (or £48/t) and more in many situations.

At current commodity prices the pressure on achieving high yields and monitoring fixed costs is high.

Tom Paybody Fisher German LLP 07870 807236 tom.paybody@ fishergerman.co.uk

07 31/10/2016 09:39

Fisher German Agri View

Focus on the Edmondthorpe and Barkby Estates John Palmer has been involved with the Estates since joining Fisher Hoggarth in February 1985. Here he talks to us about how his role and the Estates have developed over this time Tell us about the Estates and your role.

I am now partner in overall charge of management of the Estates within Fisher German. We employ a senior agent, a junior and another partner who manages the farm enterprises, plus support staff. The Estates extend to just under 8,000 acres and are a mix of let farms, let residential property, commercial and a farm enterprise.

How have the Estates and your role as an agent changed over time?

When I first arrived, there was the possibility of a large development on the southern end of the Barkby Estate adjoining Leicester. Outline planning consent was granted in 1987, which gave the owner flexibility to expand the Estates by purchasing more land and to invest in a substantial number of residential properties.

There had been little investment due to lack of funds over the years, and this reinvestment coincided with the end of the Housing Act that allowed landlords to let at open market rents.

I have always worked closely with the Pochin family – initially with Mr Pochin, then with both him and his wife and latterly with their son, who is now 20.

Any changes have always been agreed with the Pochin family.

What do you enjoy about your role?

The personal contact with the family and seeing the income streams improve with efficiency. The regular

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contact with the family allows us to carefully consider where and when to invest. Estate matters are discussed in detail weekly with Mr and Mrs Pochin.

What are the most important skills for managing a modern rural estate?

I would say patience in dealing with problems and the ability to consider various options for managing estate properties. Unusual events sometimes arise and it is having the judgement to decide how to deal with them. I would say that the single most important skill is problem-solving and addressing issues straight away to ensure that the estate continues to prosper.

What have been the most significant challenges that you and the Estates have faced?

At the start it was financial challenges and dealing with these. With any large residential/agricultural estate, there is the human factor to consider, and ensuring that the Estates continue to prosper while the owners, and in turn

the Estate residents and farmers, trust you to make the correct decision.

Over the time that you have been involved with the Edmondthorpe and Barkby Estates, what do you consider to be your greatest achievement?

Buying more land and property adjoining the Estates and for these to continue to grow in size. This is unusual for modern rural estates. We have also achieved a large sustainable urban extension on the edge of the Estate, which was the result of nearly ten years of planning. We also purchased a further large farm in Lincolnshire that has received substantial investment to improve the farmland, repair buildings and invest in residential properties.

How do you view the future for the Estates, and what do you consider to be the biggest obstacles facing modern estates?

The future of the Estates should be to maintain them and to continue to grow their size and income stream. The

“It gives me great pleasure to move around the Estates and see the good condition of the farms, woods and properties� fishergerman.co.uk

31/10/2016 09:40

Case study / 2016

The Estates extend to just under

8,000 acres biggest obstacles facing modern estates must be capital taxation and transferring the entirety to the next generation. The change in the Trust Laws introduced by the last Labour government have affected the transfer of property to a trust and the biggest challenge has to be how we are going to retain funds to pay capital taxation in whatever form.

Conservation is at the heart of the Estates. How important is this role to traditional country estates? How is this balanced with the more commercial aspects of the Estate?

Mr & Mrs Pochin consider conservation to be a vital factor for the Estates, and I believe that modern estates should be prepared to set an example in this.

Both Estates have had large tree planting programmes, including many miles of hedgerows replanted, as well as a large Higher Level Stewardship Scheme that has been introduced on the Edmondthorpe Estate to help bring back the wild grey partridge.

The important part is that the farms are all farmed at a profit, and with the help of the Stewardship Scheme, are

economically viable. If large country estates do not set an example then I believe they will become ineligible for any central funding, and as a result of Brexit we are hearing, via the media, of large landowners being handed large payments.

It is very important that estate owners should be seen as hands-on, part of the community and answerable to the community.

What role does an estate play in supporting the local rural economy?

I think that this is a very important question for rural estates, and nobody should be more conscious of the local rural economy than the estate owner.

Local enterprises, small workshops and farm shops on the Estates have always been encouraged, including substantial investment, and farmers on the Estates have been allowed to expand on to land that has either been purchased or has been surrendered by retiring farmers.

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How do you measure the success of the Estates’ activities?

The answer is simply a mixture of ensuring that the income increases to allow various improvements and repairs to properties to take place, as well as ensuring residents and farmers on the Estates are content and believe they are part of a successful enterprise.

I believe that we have this mix at Barkby and Edmondthorpe. The farmers and residents know that the Pochins live on the Barkby Estate, and should tenants feel they require direct contact, the Pochins are always pleased to meet them to discuss any issues directly. It gives me great pleasure to move around the Estates and see the good condition of the farms, woods and properties, which I believe look very well managed.

John Palmer Fisher German LLP 07860 558080 john.palmer@ fishergerman.co.uk

09 31/10/2016 09:40

Fisher German Agri View

Model farm

TIGER FARM is a virtual mixed farm based in Leicestershire.

240HA Owned 128HA Agricultural Holdings Act Tenancy 40HA Five-year Farm Business Tenancy Contract Farming Agreement 111HA

Tiger Farm is a virtual farm that has been created by the Fisher German farms team to model the different business dynamics and scenarios that are often faced by real farms FARM UPDATE In common with many farmers in the region, the 2016 harvest was one of mixed yields and quality. Most crop yields were below budget, with oilseed rape and winter barley crops particularly suffering.

Tiger Farm’s results are shown in the table below.

Based on current ex farm prices, the farm’s winter barley crop was £193.39/ ha down on budgeted output and winter oilseed rape likely to be £125/ha down on budgeted output; both are likely to lead to loss-making situations.

Winter crops are now all established, with the usual considerations for blackgrass control. Ewes were put to the tup in October and are benefitting from good late summer grass growth.

Winter is an ideal opportunity to make time to check all land drainage systems and take remedial action if required. Implementing the basics of ensuring ditches are flowing, outfalls and culverts are free from obstruction should be routine on all farms, but are particularly important on the heavy land at Tiger Farm.

Crop

Budget Yield t/ha

Harvested Yield t/ha

Variance

Winter Wheat (feed)

9.5

8.8

-8%

Winter Wheat (milling)

9.3

8.7

-7%

Winter Barley

8.5

7.2

-15%

Winter Oilseed Rape

4

3.2

-20%

Spring Beans

4

4.3

+7%

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ARABLE UPDATE 2017 CROPS Blackgrass control proved difficult in 2016 and was a constraint on yield for many farmers. Control of blackgrass in winter wheat and winter oilseed rape can no longer be achieved with chemicals alone.

On heavy land, it is difficult to strike the balance between the positives and negatives of delayed drilling of winter cereals. Delaying can allow blackgrass seeds to germinate but needs to be balanced with drilling early enough for ground conditions to give quality seedbeds without damaging soil and reducing yield.

Winter wheat and barley crops were established in early October and have had robust pre-emergence herbicide applications, costing up to £100/ha for wheat crops if Avadex granules have also been applied. This

TECHNICAL UPDATE: ENERGY CROPS Commodity grain prices have been volatile over the last ten years, influenced by increased global trade and reduced price support as a result of CAP reforms. This has made arable farm gross margins and farm profitability increasingly difficult to budget for, as input and

highlights the additional cost of blackgrass; at least £40-50/ha for both winter wheat and winter oilseed rape crops as compared to a totally blackgrass-free scenario.

Winter oilseed rape crops drilled mid-August have received ample moisture to promote germination and growth. Since the withdrawal of neonicotinoid seed treatments, pressure on seedling oilseed rape from cabbage stem flea beetle has increased dramatically.

As temperatures fall, applications of residual herbicides to oilseed rape crops begins. Depending on varietal resistance, fungicides for phoma and light leaf spot control will be included.

Given the overall disappointing yields, Tiger Farm is considering wider cropping options. A local anaerobic digestion plant has approached the farm, looking for an energy crop supplier.

output price risk increases on top of weather-related yield risks.

Effective crop management to maximise yields is crucial to achieve better financial performance. Crop marketing is more critical to maximise financial returns from that yield than in the past, with crop price swings of more than 50% in some seasons.

The increasing pressure of weeds and disease on combinable crops

fishergerman.co.uk

31/10/2016 09:48

Model farm / 2016 OWNED BY THE FOX FAMILY, the parents and eldest son work on the farm along with a full-time farm worker.

There are two other children not currently involved with the farm. The farm uses seasonal labour as required.

A farmhouse, cottage and buildings are located on the Agricultural Holdings Act Tenancy.

Current enterprises comprise combinable arable crops and a flock of mule ewes, currently finished extensively.

KEY DATES FOR TIGER FARM

Images: iStock

31 December 2016: Deadline for Annual Sheep and Goat Inventory to be submitted to DEFRA, confirming the numbers on farm on 1 December.

26 November 2016: Pesticide equipment over five years old (except knapsack and handheld sprayers) must have passed an inspection by the National Sprayer Testing Scheme. Tiger Farm already complies, as it is a requirement of its crop assurance scheme.

due to resistance to chemicals has put pressure on margins. Growers have to look at widening rotations such as adding spring crops like barley, linseed and beans to enable better weed control. Flea beetle has put oilseed rape under pressure – the withdrawal of the neonicotinoid seed dressings reduced yields by half a tonne/ hectare and is almost impossible to establish in some areas. Alternative

options for profitable break crops that can add value and control weed and pests are being looked at. On soils with vegetable growing potential, the option to licence land to others to grow produce can be part of the solution – another crop in the rotation with minimal risk and a reliable return.

For those on Grade 3 arable soils the options are limited. Growing energy crops for anaerobic digesters can

fishergerman.co.uk

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provide an alternative market (albeit limited, depending on the area) for crops with much less price volatility.

Maize and grass silage, energy beet and whole crop rye make excellent energy crops. Adding these into the mix can help growers by widening their combinable crop rotation, stabilising their margins and returning organic matter to the soil. It also makes their arable

11 31/10/2016 09:48

Fisher German Agri View

operations more sustainable, both financially and environmentally.

While there will always be yield variations, most purchasers are interested in multi-year contracts on fixed prices relating to the dry matter delivered. This gives both parties certainty over several years.

David Kinnersley Fisher German LLP Tel: 07501 720405 david.kinnersley@fishergerman.co.uk

DM% T/Ha £/t

Hybrid Rye Silage 37 40 32.19

£/%DM

0.87

0.95

£/Ha

1287.6

1316.7

80.0 734.8

£/Ha £/Ha £/Ha

110 100 143

120 189 95

80.0 74.0 137.0

Energy Crop Gross Margins Yield Value Straw Output Seed Fertiliser Sprays Total Variable Costs Gross Margin Opex Cultivate Drill Fertiliser Spray Harvest Drying Costs Rent Total Operating Costs Net Margin Net Margin

Maize

Spring Barley

33 42 31.35

6.5 100.0

£/Ha

353

404

291.0

£/Ha £/Ha

934.6

912.7

443.8

119 43.5 35 72 170

88 43.5 35 42 175

90.0 43.0 35.0 72.0 79.0 26.2

£/Ha

439.5

383.5

345.2

£/Ha £/T

495.1 12.38

529.2 12.60

98.6 15.1

£/Ha £/Ha

SHEEP The lamb trade has been influenced by exchange rate factors, with fat lambs trading at prices 15-20% higher than in 2015; average prices should exceed the budgeted £75 per head. As a result, ewe replacement costs have firmed with cross-bred shearlings ranging from £115 to £145, depending on quality.

LEGISLATION The Agricultural Waste Management Exemption regime changed in October 2013. All exemptions for the use, treatment, disposal and storage of ‘waste’ are now due to be renewed online. Waste management exemptions are not a cross compliance requirement, but farmers have a legal obligation to obtain any exemption licences applicable to their activities.

Many farmers made the most of the recent low fertiliser prices for the 2017 harvest. On-farm storage of fertiliser falls under the Dangerous Substances (Notification and Marking of Sites) Regulations 1990 (as amended). It is a legal requirement to notify the Fire and Rescue Service (FRS) and Health and Safety Executive (HSE) about any site with more than 25 tonnes of a dangerous substance (look for the oxidising hazard symbol). The local FRS must also be notified if a site holds 150 tonnes or more of AN fertiliser. Fertiliser storage should be secure, out of sight and with warning signs displayed.

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Tom Paybody

Charlotte Gore

Tom Heathcote

Fisher German LLP 07870 807236 tom.paybody@ fishergerman.co.uk

Fisher German LLP 07785 425317 charlotte.gore @fishergerman.co.uk

Fisher German LLP 07918 628983 tom.heathcote @fishergerman.co.uk

fishergerman.co.uk

31/10/2016 12:03

Harry’s View / 2016

Harry’s view With Brexit on the horizon, the coming months will be fascinating in showing exactly what this landmark move will mean for agriculture and trade ased on the picture that was painted during the campaign, post-Brexit Britain will be a buccaneering free-trading nation with access to the single and global markets, benefiting from minimal regulation, originating in the UK, with a controlled flow of immigrants who we want (doctors and scientists) and the power to stop those that we don’t (terrorists, criminals and benefit seekers).

This utopian vision would be all very well if we as a nation had a massive surplus of goods for export, if our politicians and civil servants had an appetite for, and a track record of, deregulation, and we had a versatile workforce prepared to do the kind of work that is currently being done by migrant labour.

In the countryside, which after all voted emphatically to leave, the picture is different. The principal land use – agriculture, dependent on subsidies that our Government seems intent on reducing – supplies a sector the most profitable parts of which rely on migrant labour. In addition we are far from self-sufficient, which may mean that the national priority of successful trade deals is actually less important to us, especially if the nation can be persuaded to eat more lamb and substitute wine for cider and avocado for turnips.

The problems that confront the Government are myriad. Have no doubt that agriculture will not be high on the list of priorities in any

Images: iStock

B

trade negotiations – we are simply not important enough. The priority will be to protect the service sector, and particularly financial services.

This will, no doubt, have unforeseen and unintended consequences for the industry.

As far as trade goes – and assuming the EU sticks to its guns – access to the single market will be dependent on freedom of movement and, if our Government sticks to its guns, freedom of movement is a red line. If you are in the export business, I would advise getting familiar with WTO regulations – the default trade rules that will be used in the absence of any trade deal. The extent of the task of separating,

fishergerman.co.uk

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adapting and enshrining EU and UK law is not yet properly understood.

The optimist in me sees this as an opportunity for a bonfire of regulations, but the realist in me sees that with our general appetite for rules coupled with our track record of gold plating and rigid implementation, we shouldn’t get too excited.

Over the coming months we will get a better idea of what Brexit really means, but right now it seems that the Government has its work cut out to deliver the nation’s expectations.

Harry Cotterell OBE Chairman of Fisher German harry.cotterell@ fishergerman.co.uk

13 31/10/2016 09:50

Fisher German Agri View

Winning ways In the second year of the RBAs there was fierce competition among rural businesses across the UK elebrating all that is great about rural business, the Rural Business Awards were held on 13 October at The Belfry Hotel and Resort, near Sutton Coldfield. Now in its second year, the number of entrants had more than doubled on last year.

Fisher German, proud sponsor of the event, was delighted to present the award for Outstanding Rural Diversification Project to The Pink Pig Farm, near Scunthorpe, where the original arable farm has been transformed to a farm park with play barn, butchery, deli and farm shop.

The Pink Pig Farm aims to educate and entertain people about food and farming, and welcomes over 120,000 visitors each year, including 1,000 school children on organised visits.

Runner-up in the category was Foxholes Farm near Ware in Hertfordshire, while the Gibbon Bridge Hotel in Lancashire was Highly

C

INSIDE THE PINK PIG FARM SHOP

Commended for their diversification to a country hotel and gardens.

During the evening 14 awards were presented and Fisher German was delighted to be associated with three of the shortlisted finalists who each make a valuable contribution to rural business – Claremont Farm Shop of Bebington, Wirral, was shortlisted for

Best Food & Drink Business; Tissington Hall in Ashbourne, Derbyshire, was shortlisted for Best Rural Tourism Business and Outstanding Rural Diversification Project; and Starkey’s Fruit Ltd in Southwell, Notts, which won Rural Innovation of the Year and was runner-up in the Best Food & Drink Business category.

Nuffield International Triennial Conference and field tours Fisher German has been confirmed as a sponsor of Nuffield International Triennial Conference 2017 along with companies such as JCB and Frontier. As a sector sponsor, Fisher German will be supporting Nuffield to “develop people to make a difference in the world of agriculture” with a view to creating agricultural sector leaders and innovators of the future.

The Nuffield International Triennial Conference provides a two-week spotlight on British farming, food and rural enterprise with a programme of visits and

14 14_OK_0117FGA_RURAL BUSINESS AWARDS_REPRO.indd 14

events to showcase the very best of British in farming, food, technology and the diversified rural landscape.

Running from the 3 to 15 June 2017, the programme includes seven themed days of unique farm visits and a further three days of focused sector field tours. As part of the whole conference experience, a high-profile conference day is scheduled on 8 June at the East Midlands Conference Centre, Nottingham University.

For further details, visit the conference website at nuffieldinternational2017.org.

fishergerman.co.uk

31/10/2016 09:51

Meet the team / 2016

Meet the team…

Our 15 offices provide local experts in all these work areas. If you would like guidance on any rural property matters, please contact one of us and we will ensure you get to talk to the very best advisor

Stuart Flint Head of Agency Sector Farms, Estates and Country House Sales 07501 720422

David Merton Head of Rural Sector Estate Management and Strategic Consultancy 07770 333331

stuart.flint@fishergerman.co.uk

david.merton@fishergerman.co.uk

Richard Sanders

Darren Edwards

Holly Parry

Charles Meynell

John Ikin

Farm Consultancy 07885 215972

Sustainable Energy 07918 677571

Expert Witness 07836 212307

richard.sanders @fishergerman.co.uk

darren.edwards @fishergerman.co.uk

Valuation and General Practice 07501 720416

Compulsory Purchase 07887 627978

holly.parry @fishergerman.co.uk

Kay Davies

Ben Marshalsay

Planning 07733 124551

Development 07771 974322

kay.davies @fishergerman.co.uk

ben.marshalsay @fishergerman.co.uk

charles.meynell @fishergerman.co.uk

john.ikin @fishergerman.co.uk

Richard Benson

William Gagie

Building Consultancy 07768 552827

Minerals 07551 152691

richard.benson @fishergerman.co.uk

william.gagie @fishergerman.co.uk

Agri View is intended to be an informative guide. It should not be relied on as giving all the advice needed to make decisions.

Fisher German LLP has tried to ensure accuracy and cannot accept liability for any errors, facts or opinion. If you no longer wish to receive Agri View or any other Fisher German marketing material, email info@fishergerman.co.uk.

fishergerman.co.uk

15_OK_0117FGA_MEET THE TEAM_REPRO.indd 15

15 31/10/2016 09:52

News

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The rate Euro BPS set pa ex for Europ ymenchange 2016 ts rat The ean Basic Centrfor Engla e has pre be The vio Paym Rural us ye al Bank nd are en set win ent  dow Paym ar’s ex exch set in for ca The an Eu ch Sche lcu en RPA in Dece ts Ag ange ge rat ros an lating me ency ma es d the rat 20 kes mber.

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2016 ati rate, ymen uid coun Russi ance ons las BPS an ts by averats. cla /regis t for a se ims BACS ge ter-yo three The t from to of the transf UN over ur-wa years the sea Food er. open son ste-ex and take an . Wi the ing em many th wh d Agric EU Ro of the pti comi me-ba ea as w ons-e will ex ulture paym t, ng orld nviro pire thi year. sed ag rice an Orga ent FAO nm 's No s au ricult d po nisati en sai tum tal-pe with on ten d .1 gr ure n.

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Regu t £179 ly to le price Acco 20:10 e las:10 nds, nne d tha 137.37 p/kg dwt lation 17 th Sept be t ye(Bagits t da £281 slowes. Howerding mo s) ar) £/to st 1 iry th nth £290 10 Sept nne CA . (AM Finished ve Oc pro r to ly Fo 137.86 P t 24 th Sept bene r, ) Lambs od £213 - £220duction GA Pric fit EC 354.40 p/kg dwt th 17Co is like 6 e Ind ver Sept 138.50 ly to cro 1 st Oct ex ros 1 st Oc 10 th Sept You p mu fall 355.0 e by SMR into t Basic st be 24 th Sept 0 are ma 139.68 1 2.9 % Payme 1 st Oc as froy burn 407.90 estab 17 th Sept from Descr nt15Sch t 357.0 m thi heath lish You  1 st Oct Augu th eme (BP iption As of er, rou 0ed for s da ma Oc 11 406.2 co st te (un24 th gh S) upd EE12 EFA nte 0 y no lon problem September t 356.30 gra by nt to ate til 15Sept (un 86,556 claim til tilla ger ap 405.1 are at EJ2 paym April).ss, gorse this dast ,10 ge ents for You 31 Ja ‘an advas are: cross  Oct land ply org 0 n.) or va 1 te (un border By 11 mu 2015 til 15 anic st no .

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Agri-Facts

News

Vital information for you every month Richard Sanders Head of Farms Department

Agri-Facts is a summary of important agribusiness information that you can receive free every month from us and includes news, data and comment on a variety of subjects including:

Current commodity prices such as wheat, barley and oilseed rape, together with Futures prices Currency exchange rates A round-up of information on EU agricultural legislation, CAP Reform changes as well as consultations

Current prices for nitrogen and compound fertiliser, red diesel, straw and hay

a month

ly round

s@fishe rge

up of

news,

prices

Octob

and oth

er farmi

er 2016

ng ma

tters

o.uk

rman.c o.u

k

www.fi

sherge

rman.c o.u

k

Commentary on world grain markets Top contract prices for milk

Dead weight prices for pigs, cattle and lambs Cross Compliance – key dates to assist farmers with adherence to DEFRA and Rural Payments Agency (RPA) regulations

Other topical news items pertinent to farming businesses including capital grants, taxation changes and UK legislation

Keep up to date with the latest in agribusiness.

Email info@fishergerman.co.uk to subscribe

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31/10/2016 12:00