Industry Insight
Milking the opportunity Cattle finance that is both seen and herd Jon Hercman Head of Agriculture Haydock Finance
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he UK dairy industry plays a vital role in feeding the nation and accounted for 16.4% of last year’s total agricultural output. It is also a sector that is no stranger to challenges, some of which have arisen from shifts in demand and price fluctuations. We launched our agriculture division in September 2020 with the aim of providing financial solutions tailored to the requirements of farmers and identifying new opportunities to better support them. Over the last 12 months this sales channel has grown and significantly strengthened its position in the broker introduced agriculture finance market. With approximately 8,000 dairy farmers in the UK, we wanted to develop a solution that would support them through the market challenges. Acknowledging that a dairy farmer’s most valuable asset is often their herd, our new product enables farmers to increase their herd size through new purchases as well as leverage against their existing herd to invest in the business and to drive higher returns. It is the ability to refinance a farmer’s existing herd that makes our product truly unique. It has been developed to recognise the characteristics of cattle and their financial value which allows us to release cash to farmers for any business purpose, not just the purchase of more cattle. Furthermore, our product is available to owner occupiers and tenant farmers alike. 38 | NACFB
We rolled out our new product offering to over 50 broker partners via an online webinar in October 2021 where I was joined by our CEO John Jenkins, sales director Andy Taylor, and our senior agriculture underwriter, Vanessa Burger. Under refinance we will release up to 75% of the value of a herd. Our minimum facility size is £15,000 with a maximum facility size of £500,000. This means that we can support both small and large farmers. To date we have seen a wide range of proposals for the refinance of dairy cattle and have paid out a good number of deals. The feedback we have received from brokers has been great. Since launching this new product, we were thrilled to work with our broker partner Allan James Financial Services and assist their client with the refinance of 90 dairy cows. The deal raised £95,000 which enabled the family run business to proceed with their expansion plans and purchase additional cows.
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Our new product enables farmers to increase their herd size through new purchases as well as leverage against their existing herd to invest in the business and to drive higher returns
