Outlook 2021 Andersons Outlook 2021

Contents

Introduction to Outlook 2021 3

Farm Business Outlook • Farm Profitability Prospects 4 • Economic Prospects 6 • Farm Policy 8 • Finance and Banking 11 • Land Prices and Rentals 13 • Topical Issue – Brexit and Global Trade 15

Cropping • Combinable Cropping 18 • Potatoes and Beet 20 • Horticulture 22 • Topical Issue – Vertical Farming 24

Livestock • Dairy 26 • Beef 28 • Sheep 30 • Pigs 33 • Poultry 35 • Topical Issue – Carbon and Net Zero 38

National Administrations • Scotland 40 • Wales 42

Contributed Article • Farm Woodland 44

Outlook 2021 has been compiled with contributions from Consultants within the Andersons businesses. It is published by Andersons the Farm Business Consultants Ltd, which co-ordinates the presentation of the Andersons businesses throughout the UK. Andersons® is a registered trade-mark of Andersons the Farm Business Consultants Ltd Editors: Richard King, Head of Business Research, The Andersons Centre

Copyright © Andersons 6th November 2020

2 Andersons Outlook 2021

INTRODUCTIONOutlook TO 2021 Welcome to Andersons Outlook 2021.

When the previous edition of Outlook was published a year ago, Covid-19 was simply a novel virus in an obscure corner of China. There was little indication that it would come to disrupt economies and lives in the way that it has. The UK farming and food sector has escaped relatively lightly – people always need to eat, and farmers are perhaps natural self-isolators! There have, however, been significant outbreaks further down the food processing chain. We hope all our readers have managed to stay safe and well during these unprecedented times. All being well, 2021 will see a return to some sort of normality.

Whilst it has taken a global pandemic to knock it off the front pages, Brexit remains a key issue for the agricultural industry. The politicians appear to have taken little notice of the production schedule of Andersons Outlook, and most of the articles in this publication have had to be written before the final result of the UK and EU trade talks are known. Even if a deal has been done, the ‘friction’ in trade between ourselves and our largest trading partner will be much greater – leading to higher costs, which may well be passed back down the supply chain. Whatever the trade outcome, 2021 will see the first year of the truly ‘renationalised’ farm policy outside of the Common Agricultural Policy. Although each part of the UK is doing its own thing and progressing at different speeds, the overall direction of travel is clear. In the future, there will be less support ‘as of right’, and land managers will be expected to deliver something to society in return for the funds they receive.

Andersons’ consultants’ experience is that this should not necessarily be something to be feared. There are still great opportunities to improve financial performance in all sectors of our industry. Without the distorting effects of direct support, there can be a greater focus on the areas of activity on farm that actually make a profit. Over time a stronger, more resilient industry should result, able to meet many of the other challenges that lie ahead.

We hope that you find Outlook 2021, written by members of all the Andersons’ businesses, both informative and stimulating and, as ever, wish you all the best for a successful 2021.

John Pelham Nick Blake David Siddle Richard King Directors, Andersons the Farm Business Consultants Limited

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Farm Profitability Prospects

RICHARD KING

t is always quite foolhardy to try based on a forecasting model run by and predict farm profitability – the Andersons – the first Defra forecast Iweather, commodity markets, is usually made in December. Our exchange rates, and many other Our calculations calculations suggest returns will fall factors conspire to undermine even suggest returns – by around 10% to £4.7bn. This is a the best-constructed forecasts. For [for 2020] will fall – consequence of lower crop output this edition of Outlook, further layers by around 10% due to restricted autumn plantings in of uncertainty have been added with to £4.7bn. 2019, plus the effects of the market the effects of the global Covid-19 disruptions caused by Covid in the outbreak and the end of the Brexit first half of the year. Whilst some Transition Period. costs have been lower (notably fuel), In terms of Covid, as documented among the different sectors of UK overheads generally keep rising. elsewhere in Outlook, the effects agriculture. Overall though, returns The chart shows two other data on agriculture have been relatively in the industry are likely to be lower series. The first, Direct Support, is limited. After a short period of than those shown. a reminder of the level of public upheaval when ‘lockdown’ was As usual, Defra’s Total Income support going into farm businesses. introduced, food markets soon from Farming (TIFF) series is used It covers the BPS plus any agri- regained their equilibrium. However, to look at the profitability of UK environment income. It can be with the disease appearing to agriculture. This has been running seen that ‘subsidy’ has comprised become chronic within society, and since 1973 (when we joined the perhaps two-thirds of farm profits in the economic fallout from this, there EU) and shows the aggregate profit the last decade. There is a ‘funding may be more fundamental shifts in from all UK farming and horticultural guarantee’ that should maintain this food demand to come (see following businesses for the calendar year. until 2024 but, thereafter, amounts article). In simplistic terms it is the profit of are likely to fall. Also, as payments Brexit, and especially the Future ‘UK Farming Plc’. More precisely, move to a ‘public goods’ basis, there Relationship (or not, as the case may it measures the return to all will be less profit in the receipt of be) between the UK and EU, is also entrepreneurs in the industry for their subsidy as land managers will have discussed in detail elsewhere in this management, labour and capital to be doing something to earn it. publication. The forecasts for farm invested. Figure 1 shows TIFF going These changes are still in the future. profitability that follow are based on back to 1997. Exchange rate movements have an an ‘orderly’ Brexit with some sort of The latest Defra figures relate to immediate effect and these are also UK/EU Deal – even if it is minimalist 2019. These show profits rising by shown on the chart. If there is a No and limited to preventing tariff 6% in real terms after the weather- Deal outcome this is likely to keep barriers. Should there be no deal, affected 2018 year, to nearly £5.3bn. Sterling weak, which is generally then there will be winners and losers The data for 2020 and 2021 are good for farm profits (under normal

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Total Income From Farming, Support and Figure 1 Currency - 1997 to 2021 (Real terms, 2019 prices) Any No Deal outcome would push profits down compared to 2020 – probably below £4bn, or even lower.

circumstances). If a Deal is done (even a limited one) the end of uncertainty should see the Pound strengthen. This can be seen as a regulating mechanism, perhaps preventing farm profits swinging too Source: Defra / Andersons wildly in either direction whatever the Brexit outcome - although a No Given the circumstances outlined much in line with recent years. But Deal is unlikely to be fully offset by above, the profitability prospects for any No Deal outcome would push currency shifts. For the purposes of 2021 look reasonably good. With profits down compared to 2020 – forecasting TIFF, it is assumed the more normal cropping conditions probably below £4bn, or even lower. Pound stays in the range and Covid ‘managed’, profits would €1 = 85-90p. rise by 5%, close to £5bn – very

5 FARM BUSINESS OUTLOOK

Economic Prospects

GRAHAM REDMAN

n this section of Andersons’ Briefly taking each individually, is fostered, ideas are shared, and Outlook 2020, published a Government needs to encourage new acquaintances made. For the Iyear ago, we made all the economic growth and quickly. This more physical work, rules of social right predictions, but for all the is hampered by ongoing restrictions distancing, cleansing, and covering- wrong reasons. We talked about and closures to retain a low ‘R’ up will impact productivity. how the world was heading for number. The depressing state of Less money sloshing about from global recession, how when the not being able to mix freely with fewer hospitality and hotel workers world gets sick, so does the UK family and friends will presumably and other badly affected sectors (it was metaphorically referring continue for some months until will keep the whole economy from to the economy). We also said we learn to live with Covid-19 (and reaching the somewhat tardy 2019 unemployment would rise and possibly Covid-20 and 21), as we levels probably for 5 years or more. productivity be poor. Nothing do influenza. Office workers will But new worlds also require was mentioned about hiding from remain Zoo(m) animals and agree new ideas, innovation and diseases, furlough and by quite how deals with faces on screens. On change, and the innovator and much the economy would shrink. paper, this is efficient, cutting out the entrepreneur will do very well out Perhaps, the UK was going to niceties of asking how the journey of these unprecedented times, suffer anyway, and so the actions we was and polite coffee chatter, but whether in agriculture or other took to avert the viral spread has had in fact as much business is probably sectors. Manufacturing (which a smaller financial impact than they done in these peripheral events includes farming) is a good way might have done. So many of us as the headline meeting. Trust to get people back to work, albeit working from home have learned to on lowish salaries; but blue-collar be productive and, of course, farming work also helps generate white has so far been largely unaffected. collar, information-based (work But it will be. We can assume from home) work too. This will be everybody with income or assets Taxes will presumably important with current projections might be expected to help bail rise at some point but, of unemployment totalling 8.3% of out the Government from the currently, the debt the workforce after furloughing ends. unprecedented debt it finds itself in. has been financed Economic growth in 2021 should be Short of default, Government debt is by sales of Gilts at the fastest this country has seen for repaid by either economic growth; exceptionally low decades at potentially 5% or 6%, but taxation which, for the ‘have’s’, is levels of interest. based on a shrinkage of 10% for the presumably an inevitability at some 2020 calendar year, will still leave point; and inflation, which erodes us considerably poorer at Christmas levels of debt as quickly as it erodes 2021 than we were at Christmas assets. 2019.

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Taxes will presumably rise at some point but, currently, the debt has been created by sales of Gilts at exceptionally low levels of interest - for as much as 50 years in some cases, so the urgency to generate additional cash may not have hit the Chancellor of the Exchequer yet. Only if the fall in economic turnover reduces revenues beyond his ability to pay for our teachers, firemen, police, roadbuilders and, oh yes, some hospitals too, will taxes rise sooner. Inflation is low and probably will remain so in 2021 as the spare capacity in the workforce restrict wage rises. Deflation might be more of an economic risk. However, several factors should keep the UK from slipping into this spiral. Unprecedented levels of quantitative short term too). Government might be able to swerve easing (printing money from thin Will the outcome of Brexit, round the fallout from its enormous air) is inflationary, Base Rates at their whichever way it goes, make impact simply because we are lowest for 320 years is inflationary any difference in the end to the fighting a Goliath, many times larger. and a weak Pound would be too. economy? Well yes it will, but having Whichever forecast we align This last point is contingent on the had an economic body blow in ourselves with, the world, the UK outcome of the Brexit negotiations, 2020 of 10% of our GDP, it might and British farming has to emerge but should a UK/EU deal not be just turn out to be only another from Covid and other challenges in done, then Sterling will probably be 4% or 5% spread over a number of a decarbonised manner. This will smaller than it was when this was years, so it might not even get to leave economic opportunities for written and that is inflationary (and the middle pages of the comments those prepared to embrace them this would also be good for farming section, let alone the headlines. The but stifle the lifestyles of luddites and environmental rejectors not prepared UK Growth (Quarter-on-Quarter Change) to play their parts in removing Figure 2 – 1955 to 2022 carbon from their lives. We should consider the 2020’s as the transition decade, and we are already 10% of our way through it. More opportunity beckons for the entrepreneur. During a period of such intense change and upheaval, the entrepreneur will be favoured over those that passively wait for investment returns. When change is in the air, opportunity abounds for those light-footed and quick- thinking doers. Modern technology means few will harvest most unless policy prevents it. That is unlikely.

Source: ONS / Andersons

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Farm Policy

CAROLINE INGAMELLS

e are entering a period of continuing but, importantly, 2021 Once support is delinked a farmer significant change in farm marks the start of the seven-year could double the size of their Wsupport. That said, all the Agricultural Transition which will see holding or stop farming completely devolved regions have announced direct payments reduced, so that by and they would still get the same the BPS will continue for 2021 2028 there will be no BPS-type of future stream of income (tapering- although with some ‘simplification’ support. off to 2027). It effectively gives of the rules. Here we are already At the time of writing (October the claiming business a right to the witnessing the expected divergence 2020) only the payment deductions future support based on what the in legislation, as each region starts to for 2021 were known. But it is claimant received in a ‘reference write their own domestic farm policy expected that, by the time Outlook year’ (or years). The key point is, the post Brexit. has been received by readers, Defra reference year could determine who In England, all Greening will have launched its long-awaited gets the support through to 2027. requirements have been abolished consultation on the Transition The consultation should give further from the 2021 scheme year; this (originally expected in 2019). This details on this. includes Ecological Focus Areas will not only give us more of an idea Any Tenancy Agreements written (EFAs) and Crop Diversification (CD) of the deductions beyond 2021, but pre-2019 are unlikely to have any – the two and three crop rule. But in also further information on delinking clauses in them which deal with Scotland, although CD will no longer of the BPS from land and lump sum delinked payments. If a Tenant has be required, EFAs and the Permanent payments. made a BPS claim which included Pasture requirements have been the reference year, the right to maintained for 2021. In Wales, the future income stream would the Government has launched a become vested in the Tenant. If consultation on a number of changes All the devolved the Agreement is brought to an end to the BPS, whilst it transitions to its regions have during the Agricultural Transition the new Sustainable Farming Scheme. announced the BPS Tenant would still have the right to Included in this are proposals to will continue for 2021. receive the delinked income stream remove the Crop Diversification and the land may not have any requirements for 2021 and move the ‘support’ for the incoming Tenant. EFAs and Permanent Pasture rules to Lump-sum payments must the Cross-compliance Legislation. Delinking is a mechanism that not be confused or ‘bundled-up’ Further details of the Scottish and breaks the link between receiving with delinking. It is the idea that Welsh farm policy are included in the support and occupying agricultural the future stream of income from regional articles later in Outlook. land. It looks very likely to happen, delinked payments is rolled-up In England, the Basic Payment but it cannot commence before into one single payment. But it is Scheme architecture may be the 2022 claim year at the earliest. separate from delinking; it may not

8 FARM BUSINESS OUTLOOK be introduced in 2022, it may not Farming Incentive (SFI) scheme will be available to everyone, it may not be the prototype for Tier 1. This even be introduced at all. More scheme will not be available until information is (again) expected in 2021 marks the start 2022, but will be one which most the consultation. The idea is that of the seven-year farmers should be able enter. This it could be used as a retirement Agricultural Transition is envisaged by Defra as a way for sum or allow for investments to be which will see direct all farmers to recoup some of the made. If it is introduced, it is unlikely payments reduced, so BPS money which will be lost as to be available to everyone at the that by 2028 there will we go through the Agricultural same time, as there just wouldn’t be be no BPS-type Transition. No details are available enough budget. There might be an of support. regarding the SFI scheme yet, but it is age threshold for example. expected to cover areas that will be As direct payments (BPS) are included in ELM, such as soil health phased out, they will be replaced and emissions, which are not well by payments for ‘public goods’ – In terms of timescale for ELM, supported under CS. services that agriculture can provide the national Pilot Scheme is meant Also in 2022 and 2023, the aim to society that are not delivered by to open for Expressions of Interest is to ‘drive-up participation in the the market. This will be through the (EOI) early in 2021 with applications Countryside Stewardship’. The much-publicised Environmental Land commencing in April. Presumably, scheme will be simplified, and will be Management (ELM) scheme. Many in order to express an interest, some the stepping-stone to Tier 2 of ELMs. of the objectives are familiar from details of the Pilot scheme will need Ultimately Tier 2 of ELMs will depend previous agri-environment schemes, to be published beforehand. This will on having a Land Management but elements such as climate change, at least give some indication of what Plan for the farm which is expected air quality and hazard protection ELM will look like in areas such as to be drawn-up between the land come more to the fore. options, management requirements manager and an accredited advisor. Defra is working with farmers to and payment levels. It is this element which will be tested ‘design, develop and trial’ the new In the interim, Defra has under the ELM pilots in 2021. In the approach. At present, it is envisaged announced schemes will be in place meantime, the current Countryside ELM will be based on a three-tier as ‘prototypes’ for the three tiers Stewardship will remain open in 2021 model; which can be used as stepping- for 1st January 2022 agreement start w Tier 1 – a broad (and shallow) stones for farm businesses to dates. offer available to all farms. Likely transition to the new support In addition, the intention is also to to have a menu of options and landscape. A new Sustainable roll out schemes, again in 2022-23, be managed online. It could look similar to the previous Entry-Level Stewardship (ELS). w Tier 2 – this will require more intensive management from farmers. The focus will be on rewarding farmers for positive management such as biodiversity, flood management, carbon storage, landscape heritage etc. This will be the ‘core’ of ELM over the long-term. It will build on the current Countryside Stewardship. w Tier 3 – this aims to get groups of landowners to work together to deliver widespread change or more complex change of land use, including afforestation, peatland restoration etc.

9 FARM BUSINESS OUTLOOK which require more complex change Possible English Agricultural Support Streams of land use. These would form the Figure 3 – 2018 to 2030 prototype for Tier 3. Whilst the majority of funding will be channelled through ELM once it is fully launched there will also be other support streams for farming in England, especially in the early years of the Agricultural Transition. These are likely to be in the following areas: w productivity improvements in farming, which may look much like the current Countryside Productivity Scheme w a Future Farming Resilience scheme which will offer advice for farming businesses – especially to help with the loss of direct payments * previous LEADER & Growth Fund grants Source: Andersons w schemes for farmers to deliver animal welfare enhancements that important. emissions by 2050. The Government go beyond the regulatory baseline If the myriad of new support has also joined the international It is unlikely that there will be a measures isn’t enough, there will be ’30 by 30’ campaign, a pledge direct replacement for the EU Rural changes to farm tenancy legislation that 30% of the UK’s land will be Development programme and the through the Agriculture Bill. These protected by 2030. This will require suite of schemes it funded. Funding are relatively minor though; the more a further 400,000 hectares of land for measures such as forestry, contentious issues, which would to be designated and could see competitiveness and training are allow Tenants to assign their tenancy new National Parks being set up or likely to come under the main to a third party on retirement or existing areas extended. ‘agricultural’ support system. But extending family members eligible Outlook 2020 gave a ‘heads-up’ in terms of rural socio-economic for succession rights are being on Defra’s National Food Strategy. development (i.e. a replacement considered further. In addition, An interim ‘Part 1’ report has been for LEADER and the Growth Fund) the Government is still reviewing produced which provides urgent this will be funded through the new responses to the consultation which recommendations to deal with the Shared Prosperity Fund. proposes giving residential tenants effects of Covid-19 and the end of A new regime will be required to more security – this could present the Brexit Transition period. But Part replace Cross-compliance, which problems for those renting out 2, due in 2021, is expected to make becomes ineffective once the surplus farm properties. more sweeping recommendations BPS is delinked from land. This is The landmark Environment Bill is on how systems should evolve to unlikely to see much of a reduction currently stuck in the Parliamentary meet the future needs of society, in the red-tape burden on farming, process, but is expected to become impacting on the whole food chain. as much of Cross-compliance is law sometime in 2021. This will As can be seen, Policy remains already law. However, the way it is not only enshrine environmental very busy as we move from the CAP enforced (legal sanctions rather than principles in UK law for the first to the post-Brexit landscape. There BPS fines) and the administration time, but also introduces measures will be a period of quite intense of it (more proportionality and to improve air & water quality and change as businesses adjust to the ‘common sense’?) will be different. It restore habitats. The Bill will see new support schemes. But one thing also has linkages to ELM and animal the creation of a new independent looks certain, it won’t be as simple as welfare payments. These will only Office for Environmental Protection just claiming the BPS. pay farmers for going beyond the which will have the powers to hold ‘regulatory baseline’. Where that the Government to account over baseline is set is therefore quite its commitment to reach net zero

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Finance and Banking

JAMIE MAYHEW

he past twelve months have payback term. With cheap money been an incredibly testing and changing consumer demand Ttime for UK farming both whether it be for staycations, from poor weather conditions and There is a strong desire to buy local foods, offices the impact of Covid-19. Many banks appetite for downsizing & moving out of towns/ closed their books for new lending investment into ‘UK cities, new homes requiring storage due to the predicted negative Agriculture plc’. and green energy, there is a plethora impact Covid-19 would have on the of opportunities provided that the economy. However now that they new venture is in the right location. have reopened, there is a strong Although money is cheap at this appetite for investment into ‘UK accordingly and where necessary current point in time, new lending Agriculture plc’. begin conversations with lenders should always be stress tested at a As mentioned in last year’s article, well in advance of any possible pinch higher interest rate to ensure that ‘cash is king’ – and this is even more points. the debt is affordable – 6% is the true in challenging times. Businesses With the impending changes to usual base rate figure used. Perhaps should always analyse the true cash agricultural policy, it is a known fact this is a good time to fix the interest position rather than focussing solely that subsidy levels are set to reduce. rate while they are low which takes on the Profit & Loss figure. What What is the cash generation of your the risk out of fluctuating base rates. is the cash position likely to be in business with the Basic Payment However, be mindful that some fixed your business on the back of 2020 removed? In some cases, this figure and the impact on cash flow going will convert from a cash surplus to a Figure 4 Profit to Cash forward? As a reminder, in order to deficit. Therefore, it is essential that analyse the true cash position of a businesses should use the time while Profit/(Loss) business, one must take into account these support payments are readily Add Back Depreciation (shown in the those costs that appear in Figure 4, available to analyse the earning Profit and Loss account) the P&L. capacity and the total debt within Add Machinery Sales Many businesses have the business and look to reinvest Add Capital Sales taken advantage of the various to become cash generative before Add HP Loan Income Government schemes to soften the subsidy. Perhaps the disposal of Less Machinery Purchase impact of Covid-19, however this some assets could be used to repay Less Capital Purchases does not mean that the problem existing debt or even to invest in new Less HP Loan Repayments has gone away; merely postponed. revenue streams. Less Bank Loan Repayments Coupled with the impact of the poor There is a strong appetite from Less Private Drawings weather conditions affecting yields, banks to invest in diversified income Less Tax Paid businesses must plan their cash flow streams that can show a sensible Equals Cash Surplus/(Deficit)

11 FARM BUSINESS OUTLOOK rate loans come with hefty early Base Rates and Long-Term Borrowing Costs – repayment penalties should you wish Figure 5 1998 to 2020 to repay a lump sum. Due to the various impacts UK agriculture faced in 2020, it is expected borrowings will increase over the coming 12 months. This could largely be to cover trading losses rather than new investment. With the upcoming uncertainties in the industry, now is the time to thoroughly evaluate your business to ensure that it is cash generative and in a strong enough position to withstand any potential downturns in profitability.

Source: AMC / Andersons

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Land Prices and Rents

GEORGE COOK

ith so much change in other ‘eco-systems services’ now between landowner and manager to the current business coming to the fore, including: optimise returns to both. Whether Wenvironment, let us take w Water quality that is to design a scheme for stock of the market fundamentals for w Biodiversity above and below creating wildlife corridors, habitats land purchase and rental. ground or nesting sites or whether it is the The rural land market is influenced w Loss of soil organic matter and potentially exciting opportunities by several underlying themes; the role of soil in climate change offered for carbon sequestration; w Land is a finite resource exposed mitigation collaboration between landowner(s) to increasing and diverse demands w A range of other themes best and tenants will all be important. w Historic evidence confirms it summarised by the term ‘Public In terms of current land prices, is a safe long-term investment well-being’ Figure 6 shows average values for providing steady if not spectacular England and Wales. Unfortunately, increases in value good data on land prices is w The non-monetary benefits of becoming ever-harder to obtain. owning part of the countryside - New arrivals will need The benchmark RAU/RICS series buying into the rural idyll has been suspended since 2018. to remember that the The latter has been given The figures shown thereafter are countryside is also additional Covid-19 impetus. New Andersons’ figures, based on an arrivals will need to remember that a shop floor where ‘index of indices’ from national Land the countryside is also a shop floor people live and work. Agents’ figures. where people live and work. They These figures mask significant will also have to grapple with the regional and intra-regional challenges of rural broadband. differences where local markets can In terms of the ever-broader range My reason for this foray in policy be driven by two or three individuals of demands on rural land area, this is because future income streams with significant surplus funds. is illustrated by Mr Gove’s concept from Government will be driven Following a period of decline of ‘Public money for public goods’. by delivery of outputs linked to since 2015, the latest figures suggest For the majority of the time since the these themes. These will form the there has been an ‘uptick’ in values. Second World War the main farm backdrop to the new Environmental This may be linked with the general policies have focused on one service; Land Management (ELM) scheme. increase in property prices since the the provision of food. This demand The shift from area based to lockdown eased. has been effectively delivered by outcome-based income streams will Looking to the future, we would the farming industry. It is now clear in turn have an impact on both land expect neither boom nor bust in that the pursuit of these policies has and rental values. In time it is likely to land values. General economic come at the expense of some of the require a closer working relationship uncertainty and affordability issues

13 FARM BUSINESS OUTLOOK will be bearish factors. As discussed England & Wales Land Prices (Real Terms) in a previous article, the phase- Figure 6 – 1995 to 2020 out of direct payments will also be a negative – albeit support has a relatively small influence on capital values. Of more importance are the capital tax advantages of owning land. There are almost constant concerns that reliefs under Inheritance Tax (IHT) and Capital Gains Tax (CGT) will be amended to the detriment of landowners – even more so in the current climate when the Chancellor has a big fiscal hole to fill. However, we would be surprised if there are any significant changes in the short term – both Source: RAU / RICS /Andersons IHT and CGT are pretty ‘small beer’ when it comes to raising revenue and the Government has larger issues to challenging, not least because worry about. Landlord and Tenant may have With borrowing costs remaining The shift from the area differing views on the optimising low (see previous article) and the based to outcome- of income on the holding. Both underlying demand for land based income streams parties will therefore need to be very continuing, all these factors may, to will in turn have an clear on their objectives to enable a a large extent, cancel each other out impact on both land meaningful discussion to take place. and values will remain stable through and rental values. This will need to strike a balance 2021. between: Turning to rental values, rents w optimising income on the most under the old AHA Tenancies productive land on the holding remain driven by the earning through farming! capacity of the holding. I foresee relation to the serving of notices. w enhancing and optimising some interesting discussions and It is hoped there is an element income from the new income arbitration decisions around the of common sense and a practical streams from ELM and other concept of delinked payments and approach remains throughout this possible schemes once the details the subsequent reduction of land- process. finally become clear. based income. Once ELM is in place, Moving onto FBTs – standard To this point I have managed to there could well be some further methods of calculation of the rent avoid the ‘B’ word – but Tenants will fascinating negotiations between being the Basic Payment plus an need to be careful how they do their Landlord, Tenant and their respective amount – with that amount being calculations and be mindful of the agents when assessing the earning determined by the Tenant based on terms of any trade deal with Europe potential of the holding; what ELM what they think they can earn from and beyond. income should be included in the cropping the holding. calculation? – what the Tenant Landlords and their agents tend to chooses to sign up to, or what the go for the highest open market rent Landlord considers to be the ‘best’ tendered, which on occasion has left scheme for the farm? the land at the end of the agreement Short term, I expect there to be in a worse condition than at the start. little change in local rental markets Furthermore, the withdrawal of with the current Mexican stand-off the area-based payment is likely to in Landlord and Tenant persisting in make the calculation of rent more

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Topical Issue- Brexit and Global Trade

MICHAEL HAVERTY

t the time of writing (mid- The question of standards, and a October), the UK-EU level-playing field for UK producers Anegotiations are reaching Irrespective of the is especially relevant for products of yet another climax. Unfortunately, animal origin, particularly, meat. To [UK/EU] future publication deadlines prevent us demonstrate this, Figure 8 on the relationship from analysing whichever outcome next page compares the UK (GB) of ‘Deal’ or ‘No Deal’ emerges. negotiations, there beef price with selected international However, with the Transition Period will be significant competitors. Brazil, being the ending in December, irrespective of changes to how lowest-cost major producer, the future relationship negotiations, UK-EU cross-border effectively sets the world market there will be significant changes trade will operate. price. In recent years, it has been to how UK-EU cross-border trade substantially below the GB price will operate. Furthermore, the UK (often more than £1 per kg lower). is also negotiating trade deals with The imposition of the proposed UK several other countries and these on its measures being the basis for Global Tariff (UKGT) would safeguard could arguably have as much, if not trade under a US-UK trade deal. the competitive position of British more, of an impact on the future This, of course, is a major point of producers from Brazilian imports in competitiveness of UK agri-food. contention between the farming the short-term. However, if future With this in mind, it is worth looking industry and the UK Government – trade deals allow significant volumes at British farming in a global context. highlighted during the passage of the of Brazilian beef into the UK at low or Figure 7 shows that the UK is Agriculture Bill through Parliament. zero tariff levels, then UK producers wealthy, densely-populated and trades freely, but also emits a lot of greenhouse gasses (GHG). British Figure 7 ‘Global’ Britain’s Agricultural Sector agriculture is pretty insignificant (2018 data unles stated) UK World UK% EU% on a global scale apart from niche Population (billion) 66.5 7,594.3 0.9% 5.8% segments such as lamb production. Agricultural Land Area (mHa) 17.8 4,86.3.3 0.4% 3.7% Whilst the UK will be keen to do GDP ($tr) 2.9 85.9 3.3% 21.8% trade deals, farming is unlikely to GHG Emissions (mtCO2e) (2017) 546 45,261 1.2% 8.1% be prioritised. With a 3.3% share Agricultural Trade ($bn) 70 1 /32 2 1,749 4%/1.8% 2.7%/2.7% of global GDP, the UK’s bargaining Cereals Production (mt) 21.1 2,962.9 0.7% 9.3% power will be limited versus the likes Milk Production (mt) 15.3 683.2 2.2% 22% of the US, which has a 25% share of Beef Production (‘000t) 922 67,354 1.4% 10.4% global GDP. This is crucial regarding Lamb Production (‘000t) 298 9,498 3.1% 5.8% standards, as the US is likely to insist Sources: World Bank / OECD / FAO / WRI / Andersons 1 imports / 2 exports

15 FARM BUSINESS OUTLOOK would be severely undermined. The UK and Selected International Beef Prices – chart also shows that if US producers Figure 8 2015 to 2020 gain access to the UK market via an FTA, they will also be very competitive. Having a ‘level playing field’ is a frequently quoted concept in the UK-EU negotiations. This principle should equally hold elsewhere with respect to the standards that British producers must adhere to vis-à-vis their global counterparts. A baseline encompassing food safety, environmental protection and, animal welfare is needed, below which, the UK will not go in terms of acceptance of imports. This baseline needs to be set so that British farmers can be Source: Bord Bia and Andersons competitive whilst safeguarding their hard-fought reputation as quality and, as long as the products are food producers. Only then, can UK approved for sale in Britain, they are farming be best-positioned to exploit automatically approved for export to the opportunities ahead in terms of It seems likely that any France. From January, as set out in maximising domestic sales, protecting trade deal struck will Figure 9, a business will be required its share of EU markets and exploiting be quite basic, given to have a number of ‘registrations’ key export markets with its quality the time constraints. and then follow 11 (at the time of food value proposition. writing) steps. These cover areas Turning to the more immediate such as VAT arrangements, export UK-EU talks, it seems likely that any health certification, customs trade deal struck will be quite basic, declarations as well as the applicable given the time constraints. For agri- period’ with the UK Border Operating Safety & Security declarations. food, this is set to comprise of a basic Model seeing some checks delayed Teething problems seem inevitable. zero-tariff, zero-quota Free-Trade until July 2021. Many businesses Trade between GB and NI Agreement (FTA). Whilst this means have been dealing with the Covid will also be affected. Shipments trade might be ‘free’ in terms of no crisis and have been waiting (and into Northern Ireland will require import tariffs or quota restrictions, waiting) for the outcome of UK-EU additional documentation relating future trade would still be subject to negotiations. Therefore, preparation to customs, safety & security and significant non-tariff requirements. time has been woefully inadequate. sanitary and phytosanitary (SPS) In last year’s Outlook, Non-Tariff This needs to be recognised, with an checks. In the event of a No Deal, Measure (NTM) costs were examined ‘implementation period’ for at least the import duties could be applied in detail. Under an FTA these are six months from January to allow and firms will also have to account estimated to range from 1-3% for red businesses time to adjust. Such for VAT. The ‘red-tape’ requirements meat; 5-8% for poultry meat (as it periods are often a feature of other for goods being shipped from NI is lower priced); 5% or less for dairy FTAs. to GB are still unclear, although and horticultural produce; and for Businesses still need to do what the UK Government has pledged bulk cereal and sugar shipments are they can to help themselves and ‘unfettered access’. As NI will be de- minimal (<0.1%). prepare for the regulatory changes facto participating in the EU Single For exports to the EU (and trade ahead. These are significant. At Market, regulatory barriers from NI to from GB to NI) these costs will apply present, those wanting to trade continental EU (EU-26) are expected from the start of January – whether food products into France, for to be minimal. This could potentially there is a Deal or not. Importers example, simply have to complete create opportunities (e.g. for lamb to the UK will have a limited ‘grace the commercial documentation exports) vis-à-vis GB producers if

16 FARM BUSINESS OUTLOOK there are frictions on GB-EU trade. Regulatory Steps on Agri-Food Exports from GB By the time Outlook 2022 is Figure 9 to France Post-Transition published the situation with UK-EU trade should have become clearer Stakeholder Steps Involved (Haven’t we heard this before? – Pre-Requisites • Economic Operator Registration & Identification (EORI) No (import/export license) Ed). The next year could see some • EU approval for both GB (exporting country) and the dispatch plant. upheaval as the sector adjusts to • FR Importer registered with French authorities importing animal origin products. the new arrangements. But trade GB Exporter 1. Zero rates VAT (Goods leaving UK); creates commercial documentation (invoices etc.). policy will be an ongoing issue for 2. Organises export health certification (via APHA). farming in the post-Brexit era and 3. Arrange Export Accompanying Document (EAD) export declaration. HMRC 4. Use EAD to auto-generate an Exit Safety & Security Declaration (EXS). new threats and opportunities will 5. Master Reference Number (MRN) generated by EAD/EXS lodged on Goods be presented as deals with countries Vehicle Movement Service (GVMS) which then creates a Goods Movement Reference (GMR). around the world are progressed. In Haulier/ 6. Obtains GMR (needed at Border Control Post (BCP)), where regulatory checks this sense, Brexit will be more of a Freight will take place (Documentary, Identity, Physical Checks etc.), and transports process than an event. Forwarder the load. French 7. Creates a TRACES NT (required for SPS goods); arranges import Importer pre-entry lodgement. 8. Books the BCP (e.g. Calais) if load contains SPS goods. 9. ENS Entry Safety & Security declaration needed 2hrs before goods arrive at FR port. 10. Pays import duty to French Customs or to agent (if agent uses deferment account). 11. Accounts for FR VAT either payable at border or through VAT accounting (if available).

Source: Customs Clearance Consortium and Andersons

17 CROPPING

Combinable Cropping

SEBASTIAN GRAFF-BAKER AND JOE SCARRATT

020 has been a challenging Stem Flea Beetle (CSFB) pressure led break crop on many farms, as well as year for all in the cereals to some very poor results at harvest. helping to spread harvest workload 2sector, mainly determined by As a result, suggestions are that with an early start. Pulses have well the lack of autumn sowing in 2019. crop areas for 2021 harvest could known benefits to following cereals The very dry weather following be below 400,000 hectares, albeit and many have achieved good the planting of spring crops only the amount written off could be less results with peas and beans in 2020, compounded the worry, which for than the last couple of seasons due but their yield remains variable and some has led to financial results to better establishment this autumn. there is thus a risk associated with many would rather forget. However, Whilst we have seen this coming large areas. Oats have a growing for others, harvest was not as bad as slowly for a number of years, it really market on their side but only spring they had envisaged and, combined is a game-changer on many arable crops fit grass-weed situations and with a buoyant marketplace, it will farms. Crop area figures show it has spring varieties are less favoured by not be the disaster first feared. been a mainstay crop for many farms the end user. Linseed will inevitably 2020 will see the end of oilseed since the late 1980’s. spark interest again, with some trying rape on many farms. The dry Despite its inherent high cost winter crops as a direct replacement period during establishment in 2019 base and other challenges, oilseed for oilseed rape with early sowing and combined with relentless Cabbage rape has been the most profitable harvesting. Other options might exist in mixed farming areas with forage Figure 10 UK Oilseed Rape Area – 1975 to 2021 crops and/or re-introducing livestock when working with others with the specialist skills and knowledge. With alternative break crop gross margins of £200-245 per Ha less than OSR, the obvious choice for many is to extend the rotation to include a greater proportion of cereals. This effectively reduces the break crop area to minimise the effect of simply replacing OSR with a less profitable alternative. On heavy soils, the most profitable (and sustainable) rotation will be two wheats after a break crop, followed by spring barley. Others may even Source: Defra / Andersons return to continuous wheat / cereals.

18 CROPPING

It is perhaps more challenging on Range in Wheat Cost of Production – lighter soils where second cereals Figure 11 Harvest 2021 tend not to perform so well. The key to minimising the financial impact is to look at the gross margin across the whole rotation rather than direct crop replacements. One point the industry has now started to realise, as a result of the unique circumstances of 2020, is that spring cropping is perhaps not as ‘dreadful’ as many first feared. Clearly, if you simply compare gross margins, in most cases there is a negative financial impact compared to winter wheat / autumn cropping. Businesses need to build on the opportunity to consider their Source: FBS / Andersons overhead cost structure (machinery and labour costs) in light of spring to be a significant shift in incentives options; the flattening of work over the next decade. The BPS peaks reduces the need for overall The end of oilseed will no longer be there to maintain capacity (machine sizes, horse- rape … is really a farm incomes from land where, to power, seasonal labour etc). As such, game-changer on date, some businesses have elected net margin comparisons could be many arable farms. to grow combinable crops on more attractive. This is even more poorer areas and incur losses, albeit pertinent where businesses may be hidden. Support is already targeted considering whole-field stewardship at land uses such as growing food options as one of their replacement for wildlife and the permanent break crop alternatives. AB15 two- continuing with ‘full’ cropping is removal of carbon dioxide from year legume fallow is an example likely to be the best way forward. the atmosphere (Woodland Carbon of an option under the current Productivity remains one of the Guarantee Scheme). It is expected English Countryside Stewardship key differences between business that support will be further targeted which may, in some situations, act performance, certainly not scale. at such land uses. Combinable as the break crop. Given the five It is simply understanding land cropping will remain a key enterprise year term of such agreements (and capability and having excellent where land selection and the potentially longer if rolled into ELM), attention to detail. Scale and application of resources (particularly businesses must make the hard the balance between proprietors labour and machinery) can create decision to cut capacity (and thus vs employees can make a key profits without subsidy. But many cost) in the machinery and labour difference; incentivisation and businesses may need to be both fleet to make sure there are positive good management is essential to more selective in what land they financial benefits. Comparing deliver top quartile returns. These elect to use for combinable crops gross margins is only part of the are often the result of multiple and also more broad ranging in story with the medium-to-long- small improvements which when their overall land use. Those that term commitments such schemes combined deliver large changes start planning for this now, are give. There is an ability to de-risk to the bottom line. Productivity most likely to create profits from businesses and improve margins. remains the basic principle if both growing crops and collecting As a general rule, this will only businesses are to thrive. Cropping subsidy and therefore successfully work for average performers, or poor land offers low returns and navigate through the next 5-7 years poorer land, where the risk vs more importantly is high risk. of uncertainty. reward ratio remains higher. For The changing support system (in top performers, and good soils, England at least) means there is likely

19 CROPPING

Potatoes and Beet

NICK BLAKE AND JAY WOOTTON

Potatoes

t the time of writing, the will have to be even more carefully AHDB planting report considered, with no alternative Aforecasts the 3rd lowest methods of control. Another GB potato area on record. Had The range in cost agronomic challenge for 2021 will the impact of Covid-19 become of irrigation is be the efficacy of storage regimes apparent any later in the planting becoming wider, and to manage sprout control, with the season, it is likely that plantings increasingly this is 2020 crop being the first storage would have been closer to ‘average’, not being recognised season without CIPC. creating further challenges around where the services In the last Outlook we supply and demand. are provided. commented on the move towards The quick reaction of the increased irrigation in the UK potato processing industry to the pandemic sector. In our experience, the range will have certainly helped underwrite in cost of irrigation is becoming the 2020 market, although the season continues to be a challenge so far. According to the AHDB there Figure 12 GB Planted Area By Sector – 2016 to 2019 was a reduction in processing area of 7.1% as the intended market, and an increase in packing area of 1.6%. This looks to be a reaction to a lack of processing demand at the point of planting. The further Covid-19 related impact on the 2020 market remains to be seen, but it is likely that there will be more than adequate supply in the marketplace. Quality issues are also apparent, with Wireworm problems being seen in a number of packing and processing crops. The loss of Mocap will have exacerbated this issue. Site selection Source: AHDB

20 CROPPING wider, and increasingly this is not Sugar Beet being recognised where the services are provided. The average charge for irrigation is still around the £100 per his time last year we noted of the following crop will need to Ha for an application of water which that sugar appeared to be be considered in the context of soil includes the labour, infrastructure, Tin a better position than type, rotation, infrastructure, and energy and water cost itself. The other commodities in the event of approach to delivery. actual cost can vary significantly a No Deal Brexit, and lack of self- depending on the following: sufficiency in sugar production w Cost of water – supported or presented an opportunity for unsupported supply, winter or the industry. Since then, the The [beet] yield for summer abstraction, reservoir or Government has announced a 2020 is likely to be surface water. proposed Autonomous Tariff Quota disappointing w Type of infrastructure – fully (ATQ) for 260,000 tonnes of raw for many. automated pressurised plastic sugar. This volume would be lined reservoir with hydrants allowed into the UK market without every 72 metres, versus Internal paying the new UK import tariff of Drainage Board drains, and a £280 per tonne. Depending on how The guaranteed minimum price diesel pump located adjacent to this is implemented, it could mean for the 2021 contracts remain the reel. Booms versus rain guns. an increase in cheaper imports which unchanged from the previous year. w Labour – irrigation labour are likely to leave UK beet sugar The headlines of the Virus Yellow (employed for the season production uncompetitive in the compensation scheme of £12m are regardless), versus full time staff market place. This would jeopardise eye catching, but the detail requires moving irrigators amongst other the viability of UK sugar production. scrutiny, and at the time of writing jobs. The loss of neonicotinoid seed much of this was unconfirmed. w Energy – old diesel pumps dressings has resulted in crops A pilot scheme for growers to versus invertor driven energy appearing to be adversely affected take responsibility for marketing a efficient electric pumps. by Virus Yellows. Combined with small proportion of their own crop Often many of the above costs a difficult Spring and late crop through Czarnikow Group is an have been incurred, regardless of the establishment, the yield for 2020 is interesting concept, and we look amount of water applied. likely to be disappointing for many. forward to more details on the Before the season is upon us The trade-off between harnessing results of this initiative. again, consider the actual costs (both potential yield from the sugar beet fixed and variable) of irrigation within crop, and protecting the prospects your own business. The availability and responsible use of water will continue to be important in all forms of agriculture. As this article is written, there is news of a new water futures trading option in the US. This could signal the future management of this resource in the UK too.

21 CROPPING

Horticulture

JOHN PELHAM

hilst some horticultural turnover above the figures in the crops are highly right-hand column, and with static Wmechanised (e.g. (or reducing) sale prices since that vining peas and carrots), many For some crops labour time, the continuing viability of have a significant seasonal labour can represent as a number of crops has relied on requirement for crop establishment, much as 70% of all improvements in productivity. In husbandry and harvesting. For expenditure. some cases, this has been possible some crops this can represent as – the development of Long Cane much as 70% of all expenditure. raspberry production would be an Because of the volume, range and example – but in others it has not, complexity of tasks, mechanisation with production now either marginal is less developed than for, say, more of median earnings, which has or loss-making. The threat to home- widely-grown crops such as cereals. led to unprecedented wage cost grown supply is clear. By way of illustration, the labour cost inflation. In the last five years The major issue facing the UK for wheat production is typically in the hourly rate has increased by grower for 2021, however, is labour the range £80-150 per hectare; the some 35%, with severe financial supply. As many as 75% of the equivalent for strawberry production implications for those businesses anticipated annual requirement of is £40,000-70,000 per hectare. for whom employment is their around 80,000 seasonal workers Covid-19 has presented a majority cost. Figures 13 illustrates are likely to be new recruits who, to significant practical challenge to the consequences for a sample of date, have come almost exclusively those with seasonal workforces, horticultural crops. from the EU; this supply will cease which has inevitably led to increased Few businesses in 2015 were completely on 31st December 2020. employment costs for the 2020 creating profits as a percentage of At the time of writing there is still no season; in some cases by up to 15%. However, it is the twin issues Figure 13 Seasonal Labour Cost Increases - 2016 to 2020 of labour cost and availability that have, and will, dominate horticultural Crop Labour Requirement Labour Cost 2016-20 Increase Hours/Tonne 2016-20 Increase % economics and, therefore, Meridian £ per Tonne Illustrative Sale Price production in 2021 and beyond. Broccoli 22 58 8 Since 1999 seasonal wage rates Asparagus 300 780 12 have been set by the National Lettuce 40 104 10 Minimum Wage and, from April Dessert Apple 30 78 10 2016, the National Living Wage. Strawberry 140 364 11 It was the introduction of the Raspberry 350 910 13 latter, with a target rate at 60% Sources: Andersons

22 CROPPING decision from the UK Government requires a significant investment is commercial – which can take up as to whether it will raise the 10,000 in initial training and subsequent to a full season. In 2020 a number allowance under its Seasonal coaching. Furthermore, new of UK growers found that, having Agricultural Workers Scheme (SAWS) employees need to gain experience made this initial investment, they lost for non-EU workers. before they can operate at a rate that UK workers when they acquired a Any assumption that the shortfall permanent position elsewhere. in requirement can be met by UK Without a significant increase in nationals overlooks the fact that a the numbers allowed under SAWS significant proportion of horticultural Without a significant it is inevitable that home-grown production is undertaken in rural increase in the production will reduce at a time areas (e.g. Lincolnshire, Cornwall, numbers allowed when it is needed more than ever. eastern Scotland). These are some under SAWS it is Perhaps the approach of policy- distance from centres of population, inevitable that home- makers may change when the precluding daily travel for UK media-savvy consumer becomes grown production will workers. With existing commitments aware of the consequences for both reduce at a time when to accommodation and family, choice and cost of home-grown how many can or will be prepared it is needed more fresh produce? to leave home for temporary than ever. employment? The problem for the grower is that each new worker

23 CROPPING

Topical Issue Vertical Farming

ANNABEL GARDINER

post-Covid-19 world has globally each year to development evolved; restricted travel has or degradation. In addition, currently Aleft many people making the 80% of remaining agricultural land most of their home environment By 2050 the global worldwide is reported to have and utilising green space. Gardens population will likely moderate or severe erosion. Land is have been re-landscaped across grow by another not infinite and our resources must the country and many have taken 2 billion people; be utilised more sustainably. By to producing their own fruit and indoor farming 2050 the global population will likely veg. The chance to delve into a new systems have the grow by another 2 billion people; hobby, combined with the worry of capability to deliver indoor farming systems have the food scarcity during the pandemic food all capability to deliver food all year has transformed many urban year round. round. Yield stability will lead to locations. Not only has the UK seen price stability; a steadier food supply a rise in domestic urban farming but will lead to a reduction in price commercial urban/indoor/vertical fluctuations, reducing the risk of farming has also begun to take off. investment. Vertical farming is becoming more and more popular in urban locations. For example, in London, below the Figure 14 World Population – 1700 to 2100 streets of Clapham ‘LettUs Grow’ now produces salad leaves. More prevalent extremes of weather and climate change will have no effect on indoor farming, promising enhanced food security in the future. Yields should improve due to the removal of external weather patterns and the optimum adjustment of crop growing requirements. One acre of vertical farming is said to offer the same output as 4-6 acres of conventional outdoor capacity. According to some sources, over 10 million hectares of arable land are lost Source: UN / ANDERSONS

24 CROPPING

Healthier food has and will heating, labour etc) is approximately continue to be demand driven. £75.2 million. Once the carbon With consumer concerns over embedded in the infrastructure is pesticides, indoor farming, with Vertical farming accounted for, the sector’s ‘green’ its ability to control the growing is likely to remain credentials are somewhat reduced. environment should drastically a niche for the Vertical farming relies entirely on cut the use of artificial pesticides foreseeable future technology; a loss of power even as field pests will no longer be limited to high-value, for a day could lead to a crash in present. Water availability is another low volume crops. yield and prove very costly for the issue rising up the agenda. With grower. For all these reasons, vertical controlled-environment farming, farming is likely to remain a niche the opportunities for water recycling for the foreseeable future, limited will be perpetual; vertical farming to high-value, low volume crops – uses up to 95% less water than the nation’s tomatoes and provide particularly in the salad sector. It conventional farming. Better use of circa 360 permanent jobs, with seems unlikely the economics will space in urban locations will reduce an additional 100 during the peak stack-up to produce something such food miles; the UK imported £11.5 season. as maincrop potatoes under these billion worth of fruits and vegetables Breeding programmes for crops systems anytime soon. in 2019; this was approximately three to be suited for indoor and vertical Even so, as a niche it could be quarters of total fruit and vegetable conditions will need to be further substantial and will expand. The consumption in the UK. established in order for this new industry is forecasted to grow Green energy can be utilised; industry to flourish, John Innes by 21% by 2025 and is attracting Low Carbon Farming has built two Centre researchers have bred a interest from significant investors. A glasshouses (a total of 28 Ha) next broccoli variety suited to indoor reliable income stream is (almost) to Anglian Water treatment facilities, conditions. guaranteed, no external factors with and are home to the largest heat- However, the initial investment the ability to affect yield are present, pump system project in the UK. required for an indoor vertical system an increase in price stability and Sewage works heat is utilised by the is currently immense; Low Carbon an assured reduction in agriculture greenhouses and in addition CO2 Farming’s recent build cost £120 chemical spend will leave many enrichment will be provided by an million. Other estimates show the leaning towards this new way of food onsite electricity plant. The project total cost for building a 60 hectare production. expects to grow more than 10% of vertical farm (the building, lighting,

25 LIVESTOCK

Dairy

MIKE HOUGHTON, OLIVER HALL AND JAKE ARMSTRONG-FROST

or most in the UK dairy sector In the EU just 11% of milk output is this has been a relatively stable for drinking (compared to 48% in Fyear in respect of milk prices, the UK) with the rest processed. As with the exception of those badly There can now be the UK continues its shift towards hit by Covid-19 and the loss of the little doubt that the manufacturing with the ongoing Food Service market. It was perhaps liquid sector, once decline in the demand for liquid reassuring just how quickly the dairy seen as the premium milk, will this lift average prices food chain did adjust and the positive outlet for milk, has going forward? Perhaps this is a response from consumers with an much to answer for in reflection on the ‘stranglehold’ UK increase in doorstep/direct sales milk encouraging systems retailers appear to be able to apply and a lift in cheese consumption. of milk production to the sector, ensuring the margins At the time of writing the average that are generally for the farmers and the processors UK milk price is around 27.6ppl. much higher cost. remain wafer thin? Disappointingly, this is 10% lower There can now be little doubt than the average EU farmgate price that the liquid sector, once seen as which is equivalent to 30.15ppl. the premium outlet for milk, has much to answer for in encouraging systems of milk production that are Figure 15 UK Milk Market – 2010 to 2020 generally much higher cost. Level supply, longer housing periods, less reliance on grazed grass, and higher cost in terms of labour and power requirements are all legacies of the liquid market. The focus for the future should be on efficiency and not output. Our most profitable clients are those practising low cost, medium output, grazing-based systems with the yield from forage at >4,000 litres. Other key characteristics include block calving, cross breeding to enhance milk solids, and an absolute focus on cost Source: Defra / Andersons control.

26 LIVESTOCK

UK dairy farmers will face from 265 million to just 83 million! additional challenges over the next The industry needs to lead this few years with the end of the Brexit debate and not be driven by it. Transition Period at the start of 2021, Emissions could be Dairy farms already sequest lots of the demise of the BPS by 2027 and the industry’s greatest carbon and can do more; diets could legislation to cover slurry pits by challenge, with change to exclude imported items 2026. covering slurry pits such as soya (M&S and Waitrose Most reports suggest Brexit should just the tip of are leading this initiative); slurry can not be too bad for the dairy sector the iceberg. be used more efficiently to save given the UK is not self-sufficient, fertiliser (and NVZ restrictions need and our standards are some of the more science to match crop growing highest in the world. Exporters conditions); more clover rich swards may not target the UK aggressively, can be grown; genetics need to given other growing markets around be a priority for all producers. focus on low emission cows and the world (i.e. China). The Chinese Emissions could be the industry’s most dairy farmers could make more Government is encouraging its greatest challenge with covering of renewables to run electric vehicles population to consume 300g of dairy slurry pits just the tip of the iceberg. – at least around the yards. a day which could take up most of On a global scale, AHDB reported There will be much to think about the world’s ‘surplus’ milk. that if all cows performed to the for those committed to a long-term For most, the BPS equates to same level of output as the average future in the industry with the key 1-2ppl and so will be sorely missed – UK cow (7,900 lts) the population of areas to focus on being quality not considering Stewardship/ELM should dairy cows in the world would fall quantity, and efficiency not output.

27 LIVESTOCK

Beef

CHARLOTTE DUNN AND BEN BURTON

he second half of 2020 has to be the main factors driving down proved how finely balanced numbers. Tagricultural commodity The effects of reducing herd markets can be. In early May, the GB sizes on UK beef production may be Dairy-cross beef average cattle price was as low as offset to some degree in future by calves are likely to 325p per kg deadweight, by mid- the increasing use of sexed semen in make up a larger August it had reached 375p per kg the dairy herd. Sales of sexed dairy percentage of UK deadweight, a 15% increase; this semen accounted for just over half beef output in future, brought much-needed relief to a of dairy inseminations in the year to assuming they can be sector where the majority find it hard March 2020, up from 32% the year finished at a profit. to make profits. before. Looking at the proportion A tightening of domestic supplies, of beef semen used in the dairy herd reduced imports and strong retail this has increased from around 25% demand were the main factors. The in 2013 to 48% today. Very simply, providing more beef calves. These latter was driven by a rise in mince with fewer cows needed to provide dairy-cross beef calves are likely to consumption over lockdown and replacement dairy heifers, more make up a larger percentage of UK favourable spring weather facilitating cows can be served with beef semen beef output in the future, assuming barbeque demand which offset the decline in the eating-out market. Figure 16 UK Herd Sizes – 1980 to 2020 The size of the UK beef industry continues to contract. Latest data from the June Census shows both the UK suckler and dairy herds contracting by around 1% compared to a year earlier. We expect this trend to continue for both dairy and beef cows. The average yield in the UK dairy herd is likely to continue to increase, meaning fewer cows are needed to produce the same volume. With regards to suckler cows, the continued lack of profitability and reducing support payments on which the majority depend are likely Source: Defra / Andersons

28 LIVESTOCK they can be finished at a profit. cost producers in the big exporting increasing the costs of production In the short-term supplies of UK nations such as the US, Brazil, for many in the sector. prime cattle look set to remain tight. Argentina and Australia could reduce If beef cross and dairy bull calves British Cattle Movement Service data them. are to help offset any fall in at 1st July 2020 reported cattle 12- Looking to the future, whatever production from the suckler herd 30 months of age, those most likely happens with Brexit a permanent ultimately it will depend on whether to be slaughtered in the next few shift in beef prices to levels these calves can be finished at a months, down by 76,500 head (-4%) significantly above the current long- profit. on the year. Looking further ahead, term average of around 355p per kg Some integrated supply chain the number of animals available for deadweight would seem unlikely. models are beginning to evolve beef production under 12 months of Hopefully sufficient protection will in the dairy beef sector. It would age was similar to the previous year. remain to prevent the industry being be wrong, however, to think these The number of beef cross animals undercut by lower cost imports models can produce beef at a much was up and pure dairy males down, whose standards of production may lower price. On a cost of production reflecting the trend in use of sexed be below our own. basis, retailers are likely to have to semen outlined above. The true costs of production pay a premium for the product over The UK imports a lot of beef, most for many suckler beef producers, and above the current long-term notably from Ireland, and reduced to include a return on their own market average. The extent they are imports, down 11% for the first 7 labour, is between 380 and 410p willing to do so may depend on such months of 2020, was an important per kg deadweight. If the beef things as: factor in the price increase seen. In price remains in its current range, w The value placed on a fully the short-term Irish data suggests a continued decline in suckler cow traceable, regular supply of what supplies will remain tight but looking numbers is likely. can be a very uniform product further ahead there is an increased w The quality of the product and number of calves on farm in Ireland ability to market it as such as Covid-19 has limited live calf w The value consumers may export opportunities. Supplies may Whilst simply place on the full traceability such well increase in 12 to 18 months replacing imports with systems can offer time. home production may w Their responsibility to help with Whilst the exposure of the sheep sound very appealing acceptable practice with regards industry to trade disruption and to surplus calves from the dairy the situation is more tariffs following the UK leaving the herd. complex, not least as EU Single Market at the end of the It would be good to see similar year is well trailed, the beef sector the export trade helps initiatives begin to develop in suckler is far from immune. By volume, to maximise the value beef production. the UK exports around 20% of beef of UK production produced and imports around - often exporting 35% of that consumed. Whilst unwanted cuts simply replacing imports with and offal. home production may sound very appealing the situation is more complex, not least as the export trade helps to maximise the value We continue to see a huge range of UK production - often exporting in the performance of suckler beef unwanted cuts and offal. enterprises; feed, forage, labour and However, in its simplest form, with machinery costs are the biggest imports much larger than exports, a variables and those with the very No Deal Brexit could increase beef lowest production costs have prices, at least in the short term. In typically found innovative solutions the longer term, if the UK strikes for taking costs out of these systems. trade deals with the wider world, In the short-term, increases in straw any increased access given to low- and concentrate feed prices are

29 LIVESTOCK

Sheep

DAVID SIDDLE

aving now contributed to the short term and changes to farm Covid-19 in terms of the closure sheep article in Outlook for support payments longer term of restaurants and perhaps longer Hmore than 20 years, trying to being the main drivers. Low levels term in terms of personal finances, summarise the prospects for the year of profitability excluding support suggests consumption levels are ahead and beyond for this sector of payments for many and an aging likely to continue to decline. As the industry has never been more work force of family labour on which Figure 17 shows, the consumption difficult. much of the sector depends, are of sheepmeat has been in decline In this year’s article we have likely to continue to put pressure on in the UK for many years (the total commented as usual on sheep flock numbers. height of the columns is the amount numbers, trends and likely levels The 2020 lamb crop is forecast consumed each year in the UK). of production as well as reflecting to be marginally smaller than 2019 Whilst domestic production on the key fundamentals which at 16.8 million head, with weather is currently very similar to underpin the current structure of at lambing good for most albeit consumption, international trade the UK sheep industry. Rather than ewes did experience a wet winter. is a very significant factor for the attempting to forecast the potential Sheep meat production in the 2020 industry. The seasonal nature of UK effects for unknown Brexit outcomes calendar year is forecast to decline production creates a sizeable surplus and the economic consequences by 7% with the lamb kill down 4% in late summer and autumn and a of Covid-19, we have looked at and the ewe kill down 9%. deficit in spring and early summer. what commercial businesses might This surplus has formed the basis of learn from some of the study work a very successful export trade with Andersons has carried out for an average of 35% of the total UK AHDB and Meat Promotion Wales Trying to summarise lamb crop being exported over the which looked to identify the key the prospects for last decade. 95% of exports are to characteristics of high performing the year ahead and the EU, half of which go to France. beef and sheep farms. beyond for this sector Frictionless access to these markets of the industry has remains paramount if the industry Where Are We Now? never been more is to continue at its current size and The breeding flock in December difficult. with its current structure. 2019 at 13.8 million head was little New Zealand dominates imports changed year-on-year but smaller largely as a legacy going back to than it has been in recent times. Commonwealth days. Recent sheep Looking forward, some continued Lamb is a relatively expensive meat prices have been underpinned contraction in the breeding flock and premium meat choice for most by reduced levels of imports from seems the most likely outcome consumers, often eaten out of the New Zealand, both to the UK and with Brexit uncertainties in the home. The immediate impacts of the EU, with supplies tight following

30 LIVESTOCK drought. Strong demand from China which has a shortage of Figure 17 UK Sheepmeat Market – 1985 to 2019 meat as a result of African Swine Fever decimating its pig herd has also diverted New Zealand sheep meat exports from both UK and EU markets with this looking set to continue into 2021. Brexit permitting, there remains a great opportunity to continue to build on the successful export trade we have built up over many years. In addition, the sector must look to deliver a high quality, consistent, premium product to the UK retail sector which is, at least for the present time, looking for a home- Source: Defra / ANDERSONS * domestically produced lamb consumed in the UK produced product. However, even with a positive Brexit outcome, with a Free Trade Deal, we would expect Higher performing farms all complicate management practices both production and consumption had lower overheads than the for the rest of the year. to continue to trend downwards. rest. No farmer can operate in the Many top performing farms have top performing quartile without a developed systems and focussed What the Best Do keen focus on cost control. When on breeding and selection which The various studies we have producing a commodity product, reduces labour input at lambing such carried out which have looked low cost production is essential. as being able to lamb unassisted and to identify the key characteristics Overhead Costs: Labour is a mothering ability. Breeding can also of high performing beef and key element of overhead costs. The reduce other time-consuming traits, sheep farms. These found very requirement for labour on sheep the principle one being lameness. similar trends, with the three most farms varies throughout the year, Power and machinery is another influential factors contributing to the with lambing being the peak labour big contributor to overhead differences in financial performance period. Top performers keep lambing costs. Efficient sheep farms can being; short and concise, prolonging operate with very little machinery. w Minimising overhead costs lambing will require more casual Contractors can be used to reduce w Understanding the market labour and ultimately lead to varied costs in many situations. Once w Focusing on relevant detail growth rates which will potentially a machine has been bought by

31 LIVESTOCK

Figure 18 Sheep Costings - 2017

Lowland Ewes Upland Ewes Hill Ewes £ per ewe Bottom Ave. Top Bottom Ave. Top Bottom Ave. Top Third Third Third Third Third Third Net Output 90.25 101.12 111.14 77.63 94.22 120.43 65.32 85.81 120.11 Variable Costs 62.22 51.65 40.91 48.69 44.31 42.42 41.42 43.00 42.39 Gross Margin 28.03 49.47 70.53 28.94 49.91 78.00 23.80 42.81 77.71 Overheads 66.31 41.97 25.24 42.15 32.92 28.37 45.83 34.38 26.54 Rent & Finance 14.65 12.00 8.32 15.42 10.54 7.32 12.89 9.87 9.24 Profit / Loss -52.93 -4.49 36.97 -28.63 6.45 42.31 -34.92 -1.43 41.93 Variation +/- £89.90 per ewe +/- £70.94 per ewe +/- £76.85 per ewe

Sources: HCC Data analysed by Andersons a business, its cost remains with which may not ‘top the market’, but the farm for several years; hence one which is sought after, can be purchases should be carefully produced from a low-cost base, and appraised. The capital cost of a No farmer can operate hence give the best chance of selling purchase is often the major or only in the top performing for a profit. thing focussed on but over its life on quartile without a Focus on Detail: If you want to the farm, fuel, repairs, insurance as keen focus on improve something, you need to well as the costs of an operator need cost control. measure it, analyse it, benchmark it, to be taken into account. research it again and then change Housing and the production something to improve it. This of (expensive) conserved winter is where KPIs (Key Performance forage can add to both labour and Indicators) and benchmarking can be machinery costs. Many of the best Whilst output is clearly crucial, the very beneficial. Some examples of performing businesses have looked other dominant factor is the lower sheep flock KPIs include: at these costs very closely and level of overhead costs of the best w Lambs reared per 100 ewes put developed innovative solutions to performing businesses. to the ram significantly reducing them. Understanding the Market: The w % of lamb losses from scanning Figure 18 summarises the best businesses understand what to finishing results from the Welsh Red Meat the market requires and deliver it. w Average daily liveweight gain Benchmarking Study carried out They are not hung up on breeds or (DLWG) by The Andersons Centre, it shows non-commercial traits. They are w Quality of carcass a huge variation in performance. able to deliver a consistent product w % lameness w % of flock requiring lambing assistance In summary, it has been widely proven that the factors mentioned above (reducing overhead costs, understanding the market and measuring performance) will regularly place farmers into the top quartile of performance when exercised effectively. Being able to adapt and change the way farming practices have traditionally been carried out is now, more than ever, crucial for success.

32 LIVESTOCK

Pigs

HARRY BATT

ill the disease sagas roll piglets per sow and higher finishing on into 2021? 2020 has weights. Wseen trade disruptions We must remember that the The pig industry has due to African Swine Fever (ASF) and UK is a small producer. The UK Covid-19 altering the landscape of had a positive year has approximately 7 pigs to every the global pig industry, almost on a with an uplift in prices 100 people, whereas in Denmark, weekly basis. for producers. Netherlands and Spain this is 215, At the time of writing, Germany’s 70 and 63 pigs respectively. In trade with Asia seems to have been Denmark, the average breeding herd halted due to the latest ASF outbreak. size is >1,800, compared to 680 This means German exports will sows & gilts in the UK. Furthermore, enter the global carousel looking for the most recent Defra June Survey these will usually be on an indoor a new destination. Asia could find figures showed a contraction with production system, which is the sourcing pork harder as time goes the herd at its lowest number since system of choice for European on, with Brazilian supply likely to be 1983. Instead, the rise in pigmeat countries. curtailed by the Covid-19 outbreak. output is being driven by more As an industry, should we be The evidence to date suggests that the pandemic has limited labour availability within supply chains Figure 19 Global Pig Prices – 2015 to 2020 which has resulted in backlogs in processing plants. This in turn has led to price rises for pigmeat. In the UK, the pig industry has had a positive year with an uplift in prices for producers (albeit drip-fed for some B&B contracts). The sector has made further improvements in self-sufficiency with 7% growth in just two years, to 59.4% (2019). This trend could continue over the next few years with supplies around the world remaining tight due to ASF and Covid-19. Despite some forecasts that the breeding herd would increase due to better prices, Source: Bord Bia /Andersons

33 LIVESTOCK trying to compete head-on with To achieve this the focus should these other countries? We operate be on creating a three-point plan. on a different playing field to our 1. Public Perception: 40% of European counterparts, let alone UK breeding herds are in outdoor pig producers in North and South There seems scope production systems - a truly unique America. This is due to the UK’s to follow the poultry point of difference for global pork challenge from planning/building model and focus production systems. The egg regulations, higher health and on offering industry has already undertaken welfare standards and the cost of ‘free-range’ and the marketing for free-range, with inputs. the perceived benefits appealing to high welfare pork. Therefore, we should look a wide-range of consumer group. objectively, like any other non- The pork industry could adopt a agricultural industry would, at the new strategy with a bespoke British benefits and the Unique Selling Produced Free-Range label. This Points (USP) of our UK sector. Why and high welfare pork, rather than should be widely advertised and not use Brexit as an opportunity to the UK product being ‘lost’ in the marketed via mainstream media develop a market based on features commodity pork which the rest of sources. unique to the UK sector? We are the world produce. Commodities 2. Health & Welfare: At the time being told that consumers are eating tend to decrease in real terms value of writing this article it is unknown less meat, and are leaning towards each year; marketing more UK pork whether the 2020 RUMA target (99 quality not quantity. There seems as free range/outdoors will create mg/kg) has been achieved. This is scope to follow the poultry model a point of difference and should higher than both the Danish and and focus on offering ‘free-range’ prevent such value deterioration. German average antibiotic usage (in 2017) of 39.4 mg/kg and 89 mg/ kg respectively. The UK’s challenge is to get closer to the World’s top performers, whilst operating a different system and coping with the impending Zinc Oxide Ban in 2022. Despite this, our industry’s welfare standards are some of (if not) the best in the world and this should be well publicised. 3. Resource Management: Given the recent increasing scrutiny on environmental management and ‘Net Zero’, our industry should embrace the opportunity to evolve to achieve the NFU’s target of a Net Carbon Zero agricultural industry by 2040. Can the sector look to profit from a changing arable rotation working collaboratively with other farms and increasing ELM opportunities?

34 LIVESTOCK

Poultry

LILY HISCOCK AND ED CALCOTT

ith free range egg prices producers and prices will reflect this. moving from a depressed Brexit will only exacerbate the tight Wposition at less than 70 market, with potentially reduced pence per dozen last year to prices With no more import opportunities, particularly for in the marketplace today of over 90 enriched colony eggs liquid egg. Perhaps a few golden pence per dozen and strong demand from 2025, where years that free range producers from homeworking consumers does the ‘value-egg’ should look to capitalise on, ready aiming for the British Bake Off series offering on shop for more difficult times to come? 2021…, what a difference 12 months shelves come from? With no more enriched colony makes! eggs from 2025, where does the The ‘cage free’ commitment made ‘value-egg’ offering on shop shelves by the retailers by 2025 (and earlier come from? Some retailers are for some) looms ever larger and looking to barn eggs for this (just there are big concerns in the egg target looks nigh-on impossible. 3% of the existing marketplace), sector that perhaps they have bitten In the short term, this is likely to by converting existing colony off more than they can chew. Free result in strong demand for existing sheds. However, most enriched range currently represents 52% of total egg packing station throughput UK Egg Packing Station Throughput – Figure 20 as shown in Figure 20 below. Within 1st Half 2020 the retail sector the share is much higher at 68%. If consumption remains unchanged, to increase total free- range production to 65% from the current 52% by 2025 would require more than 4 million extra free range birds. Put another way, this is more than 250 extra 16,000 bird free range egg units. To achieve this by 1st January 2025, would require more than one new unit to come online every single week. With Planning Permission for new sites remaining challenging and Avian Influenza (AI) discouraging single site growth, this Source: Defra

35 LIVESTOCK colony producers are still paying In the longer term, producers out time even more so important; off investment from 2012 and, with should review where they wish to be turnaround periods may be reduced barns requiring a lower stocking post 2025. What are your objectives so ensuring good communication density (30%-40% reduction in birds), – to be a highly efficient producer, with sub-contractors for cleaning the new investment does not look operating at scale and focusing on and bedding is vital. Insurance appetising or economically viable at output or a more modest scale, should be checked to make sure over £18 per bird to convert these targeting the premium / local market there is cover should your factory sheds. with the focus on welfare, eating close and there are no alternatives The cost of production is quality, nutrition, environment etc. A for the birds; disposal for on-site somewhere in the region of 5–10 ‘price taker’ or ‘price setter’? culled birds is in the region of £100 pence per dozen less for barn than Turning to the meat sector, 2020 per kg. free range (compared to 20+p per has been a testing year. Covid-19 Meanwhile, higher welfare doz for enriched colony). Perhaps has had an impact right through the categories of free range and organic not exactly the value offering the poultry supply chain; from difficulties chicken, although relatively niche, retailers were after? in securing wood shavings for are experiencing firm demand. In our opinion, barn will see bedding; acquiring PPE/dusk masks During lockdown, people looked for some growth, perhaps up to 10% for farm staff; and the unfortunate quality and were more interested in of the market by 2025 but in most closure of some processing factories the origins of their food. Butchers cases, free-range may become due to clustered outbreaks of the shops and farm shops have done the ‘commodity’ egg offering. virus. The latter has led to factories and should continue to do well with The concern is that commodities working together with extra shifts to these ranges. tend to decline in value over time take in additional birds to minimise As we near Christmas there are and this downward pressure will the numbers which sadly had to be several concerns surrounding turkey almost certainly be passed down to culled on farm. These shutdowns size and seasonal migrant labour producers to erode their margins. A are costly and have a detriment on for processing work. Currently EU two-tier free-range egg market looks bird welfare and margins. There is workers will have to quarantine for likely – ‘standard’ free range and the current lobbying to allow factories two weeks prior to work; then may ‘differentiated’ offering. to operate on a skeleton crew, rather have to do so when they return This perhaps is where the than shutting down for two weeks to their home-country. This adds opportunity lies for free range to allow staff to isolate which will another month onto their already egg producers – tapping into the reduce the possibility of on-farm short holiday time. There must be growing culture for high welfare, culling. efforts to try and recruit UK labour environmental credentials, foodie for the roles to try and reduce the culture and home cooking. The egg cost of paying migrant staff to is a versatile, healthy offering which isolate. meets many of the demands of the The need to shout Turkey producers worry about the younger ‘Gen Z’. ‘rule of six’ carrying on into Christmas about the quality In the short term, free range egg and that sales of large turkeys will be of British chicken producers should look to: difficult. As the poults are ordered in w Obtain contracts with stable to the country’s the Spring there is very little that can pricing across the board (XL to population has never be done at this stage without forward Seconds), rather than going for been higher. clarity on Government guidelines. the highest paying packer today! Diets can be manipulated to include w Develop a good relationship less protein and more wheat but with your packer and meet their there is a risk the unique selling point requirements i.e. work together Further mitigation may lead to of eating quality may deteriorate. to develop ‘new’ eggs and timing reduced placings across farms by Alternatively, turkey producers need peak lay to meet demands 10% to create spare processing to start spreading the word about w Focus on efficiency and high capacity so companies can divert leftover recipes to try and use up the quality – fast turnaround times, birds elsewhere should shutdown extra weight to avoid giving it away. reduced antibiotic usage, clean be necessary. This makes factory However, we must also remember eggs with minimal seconds. communication nearing clear- that there is estimated to be 4.6

36 LIVESTOCK million more people in the country for Christmas due to not being able to travel – these may be of the more affluent proportion of the population. Good marketing is key (not just advertising); small producers really need to tell the story behind their turkeys to give their product identity, something larger retailers cannot do. Finally, this would not be a poultry piece without mentioning chlorinated chicken, or should it be peracetic acid chicken, which is now more commonly used in US poultry plants? Are US imports a threat to our industry? Both the UK and the US consumers prefer the white breast meat rather than the lower value cuts of wings, legs, and thighs, which both countries export. So, will the American processors flood the UK with chicken given the opportunity? It seems unlikely to arrive in huge volumes due to the combined commitment of several large UK retailers to not sell chicken unless it is produced to UK standards. The need to shout about the quality of British chicken to the country’s population has never been higher.

37 LIVESTOCK

Topical Issue Carbon and Net Zero

MIKE HOUGHTON, HARRY BATT AND LILY HISCOCK

n the 29th June 2019, target. Therefore, there is a need the backdoor, but to increase the Parliament passed the for greater innovation and improved productivity of UK farms. So how OClimate Change Act 2008 collaboration and communication can current farming practices be (2050 Target Amendment) which has on an industry level if the Net Zero adapted to be more carbon friendly? set into law a target to reduce the target is to be achieved by 2040. Do we currently use land to its UK’s net emissions of greenhouse Whilst this is a challenge it can optimum potential? gases (GHG) by 100%, relative also be seen as an opportunity. The In respect of improving carbon to 1990 levels. By meeting this Committee on Climate Change practices, there is a growing legislation, the UK would become a (CCC) estimates that change in land requirement for farms to understand ‘net zero’ emitter. use policy sufficient to achieve net their carbon footprint (Step 1). The UK agricultural industry is zero could be achieved through Traction to date has largely been led the fourth biggest GHG contributor, funding of £1.4bn per year – much of by processors and retailers, however which is why the NFU have which would flow to land managers. as an industry we must learn more committed to achieving Net Zero by The aim of adopting improved about what we are emitting. Industry 2040. To achieve this the challenge carbon friendly practices should leaders have stated that they expect is twofold: not be to increase reliance on food environment emissions scoring w Alter and adapt farming practices imports, letting carbon in through to be commonplace on food to reduce emissions w Improve and develop carbon Figure 21 UK Agriculture GHG Emissions – 1990 to 2040 sinks to offset the remaining emissions.

Figure 21 shows the trends in UK agriculture’s emissions of the key GHGs and how we might get to net zero. As we set out in Outlook 2020, it is inescapable that livestock are contributors to UK greenhouse gas (GHG) emissions; responsible for 5% of total carbon and 88% of ammonia emissions. On the current trajectory, the livestock sector and farming more generally will not achieve the overarching Net Zero Source: DECC / Andersons * excludes land use related to ‘settlements’

38 LIVESTOCK packaging within the next two years. the energy production a Net Zero Therefore, let’s take advantage and process. be in the best position to tackle the It seems clear that part of the competition. Carbon footprint tools There is a need for drive towards net zero will involve are available at a farm/product level. greater innovation more tree-planting - as set out Once current emissions are being and improved in the Contributed article in this accurately measured, Step 2 will collaboration and year’s Outlook. But there are also be to evolve and monitor. Industry communication on opportunities at smaller scales. It is must alter land use policy, with land an industry level if estimated that enhancing the existing used for food production or the the Net Zero target is hedgerows in the UK could increase environment (i.e. renewable energy). to be achieved CO2 storage by up to 500,000 Farming for food will need to be by 2040. tonnes each year. There are many smarter with practices adapted to be other land uses that can sequest more sustainable. Some examples of significant carbon – especially this are given below; peatland, but even such ‘ordinary’ w Gene editing and genomics to land as permanent pasture. The produce carbon friendly livestock others, some ‘farming’ will continue key issue for many farm businesses and plants. The Nobel Prize was alongside the carbon mitigation is how the provision of carbon awarded to a CRISPR gene editing activities. reduction is going to be measured method which can alter the DNA Renewable energy production will and monetised. In England, the of animals and plants to improve continue to grow as a land use. A ELM scheme may provide public reduced methane emissions in key aim for the Government appears funds. A comprehensive economy- cattle and rice paddies (if allowed to be the development and utilisation wide carbon trading scheme would within the UK). of BECCS (Bioenergy with carbon provide a more liquid and robust w Use of alternative feeds, i.e. capture and storage). This will alternative. Over the next decade 3NOP & seaweed, to inhibit gas involve more growing of feedstock the provision of ‘carbon services’ release has reduced emissions by for energy production, with biogas may become an important income up to 30% in trials. These feeds plants then utilising technology to stream on many farms. could be a necessity in livestock store carbon underground, making rations in the coming years. w Utilisation of smart technology - virtual-fencing systems, enabled through a GPS collar, are used in Australia to provide grazing platform flexibility. w Maximise the potential of slurry - Arla have unveiled a biofuel trial generating fuel from slurry (to power their milk tankers), whilst still providing a digestate or solid matter fertiliser for farmers. In addition, there are membrane filtration systems that separate slurry into clean water and a concentrate fertiliser.

A proportion of current farmland is likely to move into ‘carbon- reduction’ uses. The CCC estimates this at 20-25% of the land area – a proportion of this land will cease food production entirely, whilst on

39 NATIONAL ADMINISTRATIONS

Scotland

ALEX CARAFFI AND BEN KELLAGHER

cotland arguably started expensive stores can make them pay 2020 in a significantly better in 2021. The beef sector has been on Sstate than much of the rest a rollercoaster, with the floor falling of the UK, with the majority of the Businesses should not out of the market during the start of planned winter crop in the ground miss the opportunity the global pandemic and then recent and growing well. In fact, in the to consider how recoveries in finished and store prices North East of Scotland the crops at they may fare when buoying producers of late. the turn of the year were looking support schemes The global pandemic has as well as your writers have seen in definitely change clearly had an impact on the wider the last decade. Subsequently, the in 2025. economy. Aside from the impact on dry spring and early summer led to the malting barley and beef sectors yield penalties on many winter barley already mentioned, there is likely to crops whilst other crops received be long term impact on demand for rain in time so as to not cause too many of the premium commodities many challenges. Harvest got an are maximising the price they can produced on Scottish farms. If we early start and motored through the achieve from the available forward fold in the recent import tax on later part of July and into August contracts. Scottish whiskey into the USA we before a break in the weather gave The dry spring had significant might be advised to think carefully a few people headaches with ready positive impacts on the livestock about future crop rotations including crops which could not be cut. sector, with lambing proceeding large spring barley areas. Harvest was mostly completed in with as much ease as in any of the The Scottish Government has good time with yields performing best years. Those flocks lambing again pulled the rabbit out of the hat well. a bit later were slightly hampered with the payment of the BPS loan The impact of Covid has been by the dry weather and slower scheme worth 95% in September seen in the fall in demand for malting grass growth. We all know what 2020. Where they will go in future barley and consequent weakness has happened with breeding sheep years with payment periods is in spot prices, meaning that for the values but perhaps one of the difficult to know. However, it seems second year in a row this was at a biggest stories has been the high unlikely to be a popular decision to discount to wheat by £20-£30 per available price for light lambs. We go back to payments in December tonne. There was also difficulty in have seen many producers taking as this would mean a substantial meeting the quality spec as harvest advantage of these prices to clear gap between payments in one year. wore on. How the 2021 season the decks early and give themselves The convergence monies paid in pans out will be interesting and a gentler autumn and winter. It 2020 provided a huge boost to a those growing malting barley are will be fascinating to see whether number of upland and hill businesses well advised to make sure they those taking the gamble with these and given the full convergence pot

40 NATIONAL ADMINISTRATIONS has yet to be used we wait to see Scottish Farm Business Income (Profit) – whether a similar payment is made in Figure 22 2010 to 2020 2021. Scotland’s Agriculture Bill passed through Holyrood in Autumn 2020. Whilst much of the content was already known, the main additional element was the sunset clause bringing the current schemes to a close in 2024, with a transition period, where new approaches are piloted, from 2021 to 2024. Secondary legislation is now required to bring forward pilot schemes and the continuation of the BPS and LFASS schemes for 2021. This is good news for Scotland’s agricultural sector, during a period of much uncertainty, whether it be Covid, Brexit and future Source: Scottish Government / Andersons trade deals. The sector knows one of its’ key sources of income is here to inform some of the payments of Scotland’s independence? It seems stay for the next few years. Figure 22 convergence monies in the early unlikely to be a high priority and it highlights just how much of the profit spring. It is difficult to suggest is doubtful that the sector will get on Scottish farms is derived from the at this time that there will be a increased levels of support. The best BPS and, in the hills, LFASS. meaningful move away from the outcome might be that the industry Businesses should not miss the SNP being in control of Holyrood. is allowed to continue on in much opportunity to consider how they They have shown strong support the same way it does at the current may fare when support schemes towards the rural vote in recent time. definitely change in 2025. Those months, but whether they are able Scotland’s rural businesses businesses that refuse to consider the to maintain support throughout a continue to prove that amongst future now may miss a period where new Parliament remains to be seen. them are some fantastic advocates they could consolidate profits, or Will agriculture be top of the list for agriculture, some excellent make investments in their business while the economy recovers from entrepreneurs, and brilliant business which will make them stronger. a pandemic, establishes itself with operators. We hope to speak to The next Scottish Parliamentary new international trading conditions, many of you in the months to come elections will be upon us in and braces for a period of discussion and wish you all the best for 2021. May 2021 and perhaps this may surrounding a referendum on

41 NATIONAL ADMINISTRATIONS

Wales

KERRY JERMAN AND DAVID THOMAS

emarkably, in Wales there the popularity of village and town currently seems to be an air butchers. However, this is still a Rof calm across the agriculture With records being relatively small amount of sales industry. With above-average output broken in Autumn compared to the export market, for prices across the various sectors and lamb in particular. breeding ewe sales records being broken in Autumn There is a degree of (false?) for another year, you breeding ewe sales for another year, security throughout the farming you could be forgiven for forgetting could be forgiven population due to the extension of that Brexit is looming around the for forgetting that BPS in the 2021 year which could corner. The effects of Covid-19 has Brexit is looming well be extended into the 2022 and pushed the Principality together, around the corner. 2023 years. There is still, to date, like the other home nations, with very little detail on the replacement local demand for dairy and red meat scheme released, with the general products increasing, particularly consensus favouring a long transition during lockdown. This has given customers and Hybu Cig Cymru, period for at least 5 years. However, the more entrepreneurial farmers Meat Promotion Wales to push ‘local’ much depends on the size of the pot an opportunity for direct sales to Welsh beef and lamb - increasing afforded to Wales once the funding from the European Union dries up. Figure 23 Destination of Welsh Lamb Without a crystal ball, it is difficult to accurately measure whether the incoming Brexit storm will be no more than a tempest in a teacup or a cataclysmic event. However, there are currently many opportunities for famers in Wales to ‘fix the roof whilst the sun is shining’ using funds in the extended Rural Development Programme. Farming Connect will now run to August 2022; continuing to offer funding of up to 80% for one-to- one strategic business and technical advice, training courses to improve Personal Development and also Source: HCC / Andersons as a stepping stone, joining young

42 NATIONAL ADMINISTRATIONS farmers with farmers ready to step items to improve stock management. w Budget the cost savings and/or back in Joint Venture schemes Rather than taking the opportunity additional output to ensure return through their Venture Programme. of funding and spending vital cash on capital invested is worth the Using this funding to assess your just because the opportunity is there, investment. current business’ performance is it is important to consider how best w Does the investment simplify a great starting point for looking to you use the funds available and or complicate the system? Extra at areas where efficiencies can be assess what the investment will complications create extra costs. improved, either through direct cost do for your farm going forwards. w How are you going to fund your savings or improved outputs, or The following points should be contribution of the investment? investments that completely change considered when investing: existing management systems. The Small Investment Items With cost of borrowings at a Covid restrictions have expanded w How long is the capital item new low, for some businesses it the use of interactive meetings in expected to last? - depreciate the is an opportune time to expand conjunction with/replacing on- cost over the expected lifespan enterprises and the use of grants can farm visits, which allows advice related to the specific enterprises aid this, as long as the business has a to continue to be given while it is used for. strong profit track record to be able minimising risk (if broadband speed is w Will it save or create additional to secure any additional borrowing. up to scratch!) labour requirements? The last 365 days shows that Further rounds of existing w Is monitoring equipment really anything can happen, and now is the schemes also allow farmers to have going to be used going forward or time for common-sense decisions funded investments in both field and just a flash in the pan? that will stand your business in good farm infrastructure as well as capital Farm Infrastructure Items stead for the future.

43 CONTRIBUTED ARTICLE

Contributed Article - Farm Woodland

JOHN LOCKHART AND JUSTIN MUMFORD

John Lockhart is Chairman, and increasing planting to 30,000 money to support public goods. Justin Mumford, Managing Director hectares per year across the UK. If The Environment Bill is also set of Lockhart Garratt - this is to be delivered, it will require to influence policy with the concept an environmental planning and Government to work closely of Biodiversity Net Gain, becoming forestry consultancy with devolved administrations, a legal requirement. This would (www.lockhart-garratt.co.uk). communities and landowners in see a mandatory requirement for all both the public and private sectors. developments to deliver a 10% net hen placed in context of With the emerging Agriculture gain in biodiversity. Tree planting, the challenges posed by Bill 2020 and our departure from whether onsite or off, will be a key Wthe Covid-19 pandemic the EU at the end of the year, we tool in meeting this commitment. of the last six months, the 2019 will see fundamental changes in Forestry and trees in their widest election now seems a lifetime away. land management as farmers and sense are now seen as possibly the However, despite all the distractions, landowners adapt to the loss of most important element in helping woodland creation, the environment, production subsidies, accompanied address the challenges of climate and climate change remain at the by a refocus on the delivery of public change, air and water quality, heart of the Government’s policy carbon capture, recovering nature, agenda. and health and well-being. We are The pandemic will pass, but seeing a massive increase in interest trees and woodlands will continue The long-term in woodland management and tree to play an important part in our planting, from both within the sector opportunities that future. The consultation on the and outside. Many landowners and woodlands present are England Tree Strategy sets out the other stakeholders are now looking range of benefits that woodlands substantial, ensured at woodlands as a new business offer including carbon capture, by their longevity, and opportunity. biodiversity, water management, ability to deliver against timber and energy production, and a vast range of natural Learning Lessons from recreation. capital benefits such as the Past carbon sequestration, After a steady decline dating from Planning for the Future water quality, flooding, as far back as the 12th Century, The Strategy looks to achieve a landscape, biodiversity, woodland as a percentage of step change in woodland creation health and well-being land area increased in the 20th and improving management of and air quality. Century. This was inspired by a existing woodlands. It is anticipated realisation of the importance of a that it will affirm the Government's sustainable timber resource after tree planting commitment of two World Wars and the subsequent

44 CONTRIBUTED ARTICLE establishment of the Forestry Commission as part of the 1919 Figure 24 New Tree Planting in the UK – 1976 to 2020 Forestry Act. However, despite this upward trajectory, tree-planting and proactive woodland management, especially in England, is still woefully short of what’s needed. In fact, 101 years after the establishment of the Commission, England is looking to learn lessons from Scotland, where the sector has successfully both challenged and supported leaders in Government and the Forestry Commission to make tree-planting objectives a reality. It is clear that, without similar strong leadership and collaboration between Government Source: Forestry Commission and the forestry sector, the ambitious plans in England will not be achieved. sequestration, water quality, flooding, Historically the loss of flexibility Short-term Assistance, landscape, biodiversity, health and of woodland as permanent land use Long-term Gains well-being and air quality. change has resulted in a significant A significant barrier to businesses capital depreciation. However, the investing in woodland is the fact Woodland Creation – right planting on the right land for that it is a long-term commitment, Where to Plant? the right reasons may see capital generally considered to be a A key consideration is finding the values increase, especially if the permanent change of land use. right land to plant on. Land suitable real natural capital values become Forestry, woodland and trees across for woodland creation is often in recognised. As well as the land the majority of the lowlands, were, competition with better-understood itself, a flexible approach is needed and still are, seen as a marginal alternative uses, some of which may for tenure, with long leaseholds, pie business activity at best, with most yield higher short-term gains such crust leaseholds and joint venture/ owners content with achieving little as energy crops, development, food share (tree) farming all being possible more than covering their costs. For production, biodiversity offsetting options. new woodlands, returns from timber and rewilding. We are also seeing agro-forestry sales are far into the future; and with It doesn’t make economic sense becoming a real option with fast high capital costs associated with to use our best and most versatile growing forestry crops, such as establishment, returns are poor and agricultural land; but equally we Paulownia, offering opportunities for highly unpredictable. need to avoid woodland creation enhanced returns and restoration of Current grants, whilst significant, impacting areas of high biodiversity soil structure and integrity. have not been sufficient to or environmental value. The focus overcome these barriers at any therefore needs to be on those areas What are the Real Costs? real scale. Funding that is simpler of land where profitable farming has It is always important to to access and can be supported relied on production-focused policies understand the critical requirements by private investment through a and support funding. For example; for woodland establishment. It range of blended finance models w low-grade arable and temporary is a crop the same as any other will be critical to effect real grassland; and good preparation and change. However, the long-term w marginal upland farmland; implementation are critical to ensure opportunities that woodlands w ex-mineral restored sites; and effective and cost efficient delivery, present are substantial, ensured w historic landfill sites (which in particular:- by their longevity, ability to deliver surprisingly account for some w woodland design and against a vast range of natural 0.85% of land area in England and Environmental Impact capital benefits such as carbon Wales). Assessment;

45 CONTRIBUTED ARTICLE

w supply of suitable plants of woodlands have been considered wide scale ‘sanitation felling’ from appropriate provenance, quality the poor relation in comparison insect infestation. Prices are on the and resilience; to other property assets, and this increase once more, but on a more w protection and vermin control; needs to change if the Government’s sustainable level than we saw two w ground preparation and effective targets are to be reached. So how years ago. planting; and might this be achieved? This increase in prices can be w maintenance and aftercare, Timber: The fundamental function explained by one of the simple including disposal of plastic tree of woodlands is the production of economic model of supply and guards. timber; whether for construction, demand. Currently there is fuel or high-quality furniture, considerably more demand than It will also be critical to undertake timber is a uniquely sustainable supply and as a result, prices have effective and realistic budgeting, product. Recent years have seen been increasing. The UK still remains taking account of potential future significant increases in timber the world’s second largest importer risks from pests and diseases, climate values that have ‘opened the door’ of timber, with only China ahead of change etc. for many historically unproductive us. As a result, the timber trade is woodlands to be brought back into heavily influenced by the exchange What Revenue Streams profitable, functional and sustainable rate. With the Pound currently Might Exist? management. weak it is making imports far more Whilst Government’s key focus The UK has experienced a rise expensive, allowing UK growers to is on expanding our woodland in the value of timber over the past remain competitive. resource, it is equally important to three years, albeit over a bumpy Markets are also becoming more give consideration to the existing path at times, particularly during diverse. This is particularly the case woodlands and trees, which 2018 where prices increased by concerning woodfuel. Traditional demonstrate the pathway that 33% on some products. This was firewood has seen prices increased our new woodlands will follow in then brought into check in 2019 as from £2 per tonne in 1999 to £30 the coming years. For too long European supplies increased due to per tonne today, as a result of

46 CONTRIBUTED ARTICLE over 150,000 new wood burning improves physical and mental stoves going into people's homes health through public access to every year. There is high demand green spaces – something which for biomass/chipwood needed to The right planting has become a key priority during power our modern combined heat on the right land for the current Covid-19 crisis. The and power plants, and this particular the right reasons may tangible value that access to high market is now taking timber that only see capital values quality green spaces offers society a couple a years ago was considered increase, especially in supporting both our physical and waste. if the real natural mental health is now recognised. The key to maximising profit is capital values become Woodlands, both new and existing making sure the grower finds the recognised. have an important role to play in this. right market for the right part of the tree and is constantly looking for the Woodlands – emerging markets as technology a New Business and globalisation progresses. For Opportunity? example, the UK now exports white Biodiversity: As noted earlier, The creation and preservation woods such as ash to Vietnam for Biodiversity Net Gain was created of woodland is a long-term internal joinery and poplar to Egypt to ‘address the hidden costs of commitment. However, we believe in order to feed its plywood board development’, with the Environment we are closer now to a position manufacturers. Bill proposing that developments where the true value of the benefits Carbon: Accountability around be required to provide a 10% gain in that woodland bring to society is carbon emissions was finally taken biodiversity from the baseline figure. properly understood. If we wish seriously when plans for a third As a long-term land use, new and to secure these benefits for both runway at Heathrow were rejected existing woodlands can deliver real our future and that of coming by the Court of Appeal in February biodiversity benefits more securely generations, we need to ensure on the grounds that the proposals than other habitat creation models that these benefits are supported did not adequately incorporate the that will only be secured for 30 years. by Government, based on their real Government’s legal commitment to Landscape, Health and Well- values. Achieve this and we will net zero. Forestry is the first sector being: Woodland creation offers a see woodlands become a real and with established carbon accounting. unique opportunity to create and sustainable part of rural property Under the Woodland Carbon Code, restore beauty to our landscape. businesses, delivering a greener woodland creation now has a clear In turn, this enhances landscape future to which we all aspire. pathway to revenue. In addition, recovery, benefits air quality and the Woodland Carbon Guarantee scheme is offering the prospect of realistic returns for sequestered carbon, with offers being made under the first two rounds in the region of £24 per tonne CO2 and £19 per tonne CO2 respectively. Water and Flooding: As recent history has shown, flooding is a major issue across the UK. As well as providing natural flood management, the planting of trees can also help reduce soil erosion and nitrate pollution. Some large- scale woodland projects are now in the pipeline with partners working closely with Local Authorities to address water quality issues across key catchments.

47 The Consultants of the Andersons Businesses

THE ANDERSONS CENTRE ANDERSONS EASTERN ANDERSONS MIDLANDS

Richard King Jay Wootton John Pelham t: 01664 503208 t: 01284 787830 t: 01544 327746 m: 07977 191427 m: 07860 743878 m: 07860 508019 [email protected] [email protected] [email protected]

Graham Redman Nick Blake Sebastian Graff-Baker t: 01664 503207 t: 01284 787830 t: 01455 823425 m: 07968 762390 m: 07748 631645 m: 07831 454320 [email protected] [email protected] [email protected]

Joe Scarratt Jamie Mayhew Mike Houghton t: 01664 503204 t: 01284 787830 t: 01722 782800 m: 07956 870263 m: 07540 686759 m: 07836 707096 [email protected] [email protected] [email protected]

Michael Haverty Ben Burton Lily Hiscock t: 01664 503219 t: 01284 787830 t: 01722 782800 m: 07900 907902 m: 07775 877136 m: 07854 811464 [email protected] [email protected] [email protected]

George Cook Pam Jacobs Harry Batt t: 01664 503217 t: 01284 787830 t: 01722 782800 m: 07836 707360 m: 07787 445433 m: 07948 245525 [email protected] [email protected] [email protected]

Caroline Ingamells Annabel Gardiner t: 01664 503209 t: 01284 787830 m: 07501 342772 m: 07387 396561 ANDERSONS NORTHERN [email protected] [email protected] David Siddle Tony Evans t: 01968 678465 t: 01664 503211 m: 07885 809119 m: 07970 731643 [email protected] [email protected] Ben Kellagher Jonathan Hughes t: 01968 678465 t: 01664 503222 m: 07770 652959 m: 07733 503966 [email protected] [email protected]

Alex Caraffi David Thomas t: 01968 678465 t: 01874 625856 m: 07970 984545 m: 07850 224524 [email protected] [email protected]

Charlotte Dun Kerry Jerman t: 01968 678465 t: 01874 625856 m: 07572 149631 m: 07838 591799 [email protected] [email protected] Morgan Innes Oliver Hall t: 01968 678465 t: 01664 503200 m: 07367 690999 m: 07815 881094 [email protected] [email protected]

Edward Calcott t: 01664 503200 m: 07827317672 [email protected]

Jake Armstrong-Frost t: 01664 503200 m: 07931 610398 [email protected]

48 49 ANDERSONS THE FARM BUSINESS CONSULTANTS

The four Andersons businessess provide services for Farming Businesses and Food and Agribusinesses. Recognising that all businesses are different, Andersons’ advisors tailor their advice to their clients’ needs. Advice may be provided in a range of areas including:-

Farming Businesses • Business Appraisal • Understanding Support Schemes and Grants • Business Strategy and Succession Planning • Basic Payment/Agri-environment Claims and • Investment Planning and Appraisal Problem Solving • Financial Planning including Budget and Cashflow • Preparation of Grant Applications • Enterprise Costings and Benchmarking • Tenancy, Rent Reviews & Arbitration • Farm Business Administration • Expert Witness • IT and Software Design • Insolvency or Managed Recoveries • Contract Farming & Joint Ventures • Recruitment • Co-operation & Collaboration • Training • Diversification

Food and Agribusinesses • Specialist Information Services • Business Analysis and Modelling • Bespoke Training & Briefing • Benchmarking & European • Preparation of Promotional Material and Economic Comparisons Bespoke Publications • Acquisitions & Joint Ventures • Appraisals & Feasibility Studies • IT & Software Design • Business Strategy • Recruitment & Personnel • Market Research & Analysis • Development

For more details on any of the above, or a discussion about your own particular needs, please contact one of the Andersons businesses. All discussions are strictly confidential and without commitment.

Agro Business Consultants Ltd Andersons is also involved in:- Publishers of the ABC Agricultural Budgeting and Costing Book, the Equine Business Guide and the Koesling Anderson Professional Update subscription service, providing A consultancy based near Magdeberg in Germany, the complete agricultural and rural information offering a range of services to businesses in service. Central and Eastern Europe.

The Pocketbook Andercourt Publishers and distributors of the John Nix Farm A joint venture with Velcourt offering executive Management Pocketbook. farm management services to farming businesses in the UK.

50

ANDERSONS THE FARM BUSINESS CONSULTANTS

ANDERSONS MIDLANDS www.andersonsmidlands.co.uk SALISBURY LEICESTER HEREFORD Contact: Mike Houghton Contact: Sebastian Graff-Baker Contact: John Pelham Tel: 01722 782800 Tel: 01455 823425 Tel: 01544 327746 [email protected] [email protected] [email protected]

ANDERSONS NORTHERN www.andersonsnorthern.co.uk EDINBURGH Contact: David Siddle Tel: 01968 678465 [email protected]

ANDERSONS EASTERN www.andersonseastern.co.uk BURY ST EDMUNDS Contact: Nick Blake Tel: 01284 787830 [email protected]

THE ANDERSONS CENTRE www.theandersonscentre.co.uk MELTON MOWBRAY Farm Consultancy Business Research Contact: Joe Scarratt Contact: Richard King Tel: 01664 503204 Tel: 01664 503208 [email protected] [email protected]

The Pocketbook Corporate Consultancy Agro Business Consultants Contact: Graham Redman Contact: Michael Haverty Contact: Anna Anderson Tel: 01664 564508 Tel: 01664 503219 Tel: 01664 567676 [email protected] [email protected] [email protected] www.thepocketbook.co.uk www.abcbooks.co.uk

MID-WALES HARROGATE Contact: Kerry Jerman Contact: Oliver Hall Tel: 07838 591799 Tel: 01423 875721 [email protected] [email protected]

KOESLING ANDERSON ANDERCOURT Contact: Jay Wootton Contact: Jay Wootton Tel: 01284 787830 Tel: 01284 787830 [email protected] [email protected]

Andersons® is a registered trade-mark of Andersons the Farm Business Consultants Ltd