Farming and Agriculture Update: Ramblings of a Rambler

Having found “pastures new” to walk along in the lockdown, most of which have been public footpaths, I have been amazed at the variety of stages that arable crops have reached even within a short distance from each other. The weather over the past six or seven months is largely to blame, having gone from one extreme to the other, causing ground conditions to go from boggy to cracks in the dry ground. An extremely dry April was followed by the driest May since records began over 150 years ago! Farmers and growers will be desperate for a return of some moisture to bring the crops on, but not too much, please! So hopefully you are reading this having been “rained-off”, and you will find something of interest in these musings of current events in the farming and business sphere:-

Covid-19

Firstly the pandemic – this is one of the best times to be located in a rural area, surely. With space to walk, and farmers able to go about (most of) their daily routines without being locked-down, most people have been able to get out and enjoy the countryside during the re-awakening that is Spring. The number of cases of COVID-19 in our area has been relatively low, but that is not to under-play the potential for damaging repercussions if the hygiene and distancing measures are flouted.

For those businesses that employ people, perhaps in diversified farms, and have had to reduce hours or put employees onto furlough arrangements, our website contains comprehensive information about the Coronavirus Job Retention Scheme, and changes to it along the way.

There have been a number of other COVID-19 related problems caused to farming which I have summarised here-

  • Shortage of labour – the new points Based System (PBS) for immigrants together with the virus means that a lot of farmers, particularly in south Lincolnshire, are concerned about the availability of labour for harvest. The virus, and lack of freedom of movement will be more relevant this year, but the PBS will come into effect on 1st January 2021 and could impact next year. The Government has tried to help the current situation by launching Pick For Britain, to try and recruit more domestic workers to work on the land. You will see that Prince Charles is giving his support to this campaign.
  • Fly-tipping – a perennial problem in rural areas, but made worse by the closure of many waste disposal sites. Farmers are asked not to touch the waste, as it may be hazardous. Instead it should be reported to your local authority.
  • Rights of Way – As mentioned above, the public have been out and about enjoying the countryside in ever-increasing numbers since the lockdown restrictions were eased. This hasn’t always led to them following the right paths, or the Countryside Code. To aid their understanding of the need to keep the countryside, and the health of the nation’s food producers, in good order, the NFU have published signs with agreed wording that can be downloaded from NFU online by land-owners, and printed off for displaying on gates, fences etc.
  • Hardship Fund for Dairy Farmers – The Government have set up this fund to help dairy farmers with the impact of the coronavirus on their industry. Demand for milk has been severely impacted on by the fall in the restaurant and hospitality trade since the lockdown began. The fund provides grants of up to £10,000 per farmer. More details are on the .gov website  
  • Concerns for malting barley – with the closing down of the hospitality sector, the demand for beer has reduced significantly. The fall in consumption in licensed premises has not been made up for by “drinking at home”, even though this has gone up by 22% since lockdown! Add to this the extra spring barley planted to replace winter wheat lost to the weather, and the possibility of over-supply of malting barley looks like a distinct possibility.
  • BPS and Country Stewardship applications – the deadline for these has been put back a month to 15th June 2020.
  • Sadly the Lincolnshire Show has been cancelled for 2020. There will still be a Virtual Lincolnshire Show, – please look out for our reminiscences of past Shows when watching the virtual Show online!
  • If you need any further information on business matters, there is a lot of information on our website which you may find useful.

In other news

Away from the difficulties caused by the pandemic, there have been a number of other happenings in the farming world that will hopefully be of interest:-

  • Oil Seed Rape – The NFU is pressing the Government to support OSR growers until an effective alternative to banned neonicotinoids can be found. The amount of OSR planted has fallen considerably in the last year, and crops have been ravaged by the cabbage stem flea beetle due to the lack of an effective treatment
  • Brexit trade talks – these are still moving along in the background, along with negotiations with other non-EU countries, as we move through the transition period. The farming trade bodies are applying pressure to our negotiators to make sure quality standards are not lowered, and our food quality is not compromised as a result
  • Sugar beet – The campaign is finally over! It officially finished on Good Friday, some 208 days after it started – the longest campaign on record, again down to the weather.
  • Air quality – Just as an aside, the farming industry has had a lot of bad press in recent years from the green lobby about the emissions from farming, generated by machinery using diesel, and livestock producing methane. Reports are now showing that all CO2 emissions are markedly down, and the air is cleaner than for some 15 years, but I haven’t seen a lot of credit being given to farmers for this. Maybe farmers weren’t causing such a big problem before after all!

A ramblers final thoughts 

One final thought, or request, if it applies to you.

It is important in family farming partnerships that a Partnership Agreement is put in place so that all partners, and other family members, are aware of their rights and responsibilities.

If not, many misunderstandings can occur, often leading to long and expensive court cases. I was reminded of this by the recent case of Dorothy Horswood V Peter Horswood. As the case name suggests, this was a family dispute. It related to whether or not a formal Partnership Agreement, put in place after farming had been on-going on an informal basis for many years, would over-write alleged promises made before the written Agreement was signed up to. PH, the son of DH, argued that he expected to receive his mother’s share of the partnership land “free of charge” as part of his inheritance. When his mother decided to retire from the partnership in 2016, her son exercised an Option per the Agreement to buy her land, but subsequently felt he should have received the land for nothing, and the Partnership Agreement should be “looked through”. His case was dismissed, and the Partnership Agreement was deemed to have been signed up to by all Partners, and was the governing document of the partnership and all its assets. It over-rode what had gone before.

If you want certainty over your affairs, that would best be achieved by having a robust, and regularly reviewed, Partnership Agreement.

As always agriculture is a big part of the local economic picture and whilst farmers might not be affected by the lock-down they and their businesses will still be affected. If you have any questions regarding the above note please contact Richard Grayson or Graham Pogson on 01522 81 5100.


Covid-19 Farming and Agriculture Update

The current lock-down and crisis caused by the coronavirus is having widespread implications across all sectors of the economy. Farmers and those working in agriculture, food and distribution of produce throughout the supply chain are playing a important role in supporting the wider public.

The business of farming is continuing and we asked Richard Grayson (head of farming and agriculture at Nicholsons) for his views on the current situation.

  • Farmers are generally carrying on as normal, with a few adjustments, such as no physical planning meetings in the morning, but instead organising themselves by phone/text.
  • Farmers are classed as key workers. The NFU are supporting them in many ways, and have given NFU members access to be able to print off an “Essential Journey Certificate” to produce to the police if necessary.
  • Farmers in most areas with combinable crops or vegetables are struggling to establish crops for the summer due to extraordinarily wet sowing season. With spring drilling, likely to lead to lower than normal harvests, which will impact on the 2020 harvest results.
  • Some farmers and fruit growers will be vulnerable to a shortage of labour to harvest/pick their crops due to a) Brexit and b) lack of movement across borders due to Coronavirus lock-downs. Local workers will be needed to help on the land.
  • Lambing is well under way, and no cross-contamination into animals as far as we know.
  • Current shortage of red diesel at an important time for farmers – having to resort to using more costly pump diesel. Caused by a lack/shortage of labour to move diesel from the docks, particularly at Immingham. This has been caused by the coronavirus.
  • Legislation has been put in place to protect residential tenancies, and commercial business tenancies. There has been no corresponding legislation put in place for 1986 or 1995 Act agricultural tenancies, so if it is proving difficult to keep up rent payments as a result of the coronavirus epidemic, tenants should enter discourse with landlords to avoid the chance of eviction.
  • Macro-economic factors and future government intervention may assist. Current low oil prices are helping and may help reduce fertiliser costs as well whilst there is the possibility that crop prices, and therefore food prices, may go up as a result of shortages/increase in demand.
  • As with most things farming, the forthcoming weather will play a big part – anyone betting on a drought and a hosepipe ban!?!

Self Employed Support Scheme (SEISS) 

Regarding the Self Employed Income Support Scheme (SEISS), there is a possibility that farmers may qualify for the payment in June. If they meet the income criteria, they will also have to consider if they meet the “loss of profits” criteria. The government have stated that they must have “lost trading profits due to COVID-19” to be able to claim.

We are not sure yet what this means in terms of whether they have lost a little bit of profit, or a lot of profit! If there is no de minimis to the amount of profit lost, most may be able to say they qualify, although the actual wording will not be known until the self-employed have a chance to apply under this scheme. The NFU are currently gathering information from members on behalf of the industry, so that they can assess the business impact, and have data to back up any claims that may be made. I will keep an eye on this situation as it develops.

Valuations 

With valuers now starting to consider 2020 valuations and with some crops having being abandoned or ploughed in we recently spoke to a local valuer about information that they could collect for us that might be useful.

This included;

  1. A note to detail the specific acreage of failed crops,
  2. A note of the costs associated with those crops up to the valuation date, where possible. These costs obviously won’t want carrying forward at the year-end, but will be “expensed” as a normal cost, with no carrying value.

As always agriculture is a big part of the local economic picture and whilst farmers might not be affected by the lock-down they and their businesses will still be affected. If you have any questions regarding the above note please contact Richard Grayson or Graham Pogson on 01522 81 5100.