High prices and policy uncertainty lead farmers to consider quitting
A leading Yorkshire agricultural secretary has revealed how many farmers are considering “packing up” as margins tighten.
Clare Wise, who runs Total Farm Solutions alongside a farm at Skipton on Swale, near Thirsk, with her husband, Phil, said while financial pressures caused by the Iraq conflict were having a significant impact on her and her clients’ enterprises, continuing uncertainty over government policy was also seriously undermining ventures.
Mrs Wise was speaking after agricultural consultant Andersons revealed agricultural input inflation had climbed soared since the start of the Iran conflict, hitting 7.6 per cent annually in March, while farm output prices fell 6.5 per cent over the same period.
Andersen said “agflation” had been especially evident in fertiliser costs, as around 30 per cent of global urea supply, a key source of nitrogen fertiliser, is constrained by the Strait of Hormuz.
Due to the rising fuel and input costs, Farmers For Action said it is considering coordinated action after being approached by farm organisations across the country.
Mrs Wise said: “Fertiiliser is at £600 a tonne at the minute. The cost that you are putting into a crop, you just are not going to get that at the other end. It’s just pointless putting anything in. I saw that 71 per cent of farmers are ready to give up – that’s quite a lot!”
She said the Government was responsible for having instilled a cloud of uncertainty hanging over the industry when they started reducing the Basic Payment Scheme and not replacing it.
She said the The Institute of Agricultural Secretaries and Administrators has seen an increasing number of cases of farmers in trouble being put to them. Mrs Wise recommended farmers continue diversifying and focusing on their cashflow.
She said: “I’m finding I’m doing more and more budgeting, at least 12 or 24 months in advance, just to keep things afloat.
"If you don’t have something that’s turning over money you’re not making any money. Around us we have seen a lot of farms go into flower farming to the public. Airb&b’s are big too. It’s about having fingers in lots of pies. It’s alright if you are a mixed farm, but it’s very difficult for the arable guys at the moment, they are getting hit massively.
"All they’ve got is that corn price at the end of the day, which isn’t brilliant, and now they’ve got the added cost of fuel. A lot of them are uncertain because they don’t know what the future holds for them.”
Due to uncertainty surrounding inheritance tax, she said many farmers this year had shouldered tens of thousands of pounds of extra accountancy fees. She said while farmers need to plan 12 to 18 months ahead, the government was giving them three or four months to plan.
Mrs Wise said: “A lot of my farmers are looking at the bottom line and are saying can we pay these bills the next month every time I go and are looking at the list of who they can and can’t pay. A lot of farmers are looking at packing up, particularly if they don’t have anyone to hand it down to. There’s no enthusiasm there any more. The light at the end of the tunnel is very dim at the minute.”