Agri-blog for February Newsletter
The way farm businesses become, or remain profitable, is likely to
change significantly in the next few years.
Brexit means that payments based on area farmed under the EU's Basic
Payment Scheme (BPS) will be phased out over the next 7 years.
Farmers will receive payments for providing public goods under a new
ELMs Environmental Land Management Scheme helping Government meet its
commitment to be net zero carbon by 2050. Public Goods can be described as goods that
benefit the community and which don't have a recognised market value such as flood
mitigation through management of streams and flood plains, or managing soils
and planting specifically to increase the storage of carbon and its removal
from the atmosphere. Managing land to
provide habitats for vulnerable plants and animals to increase biodiversity
would be another example.
Defra is taking a
"co-design" approach to ELMS and has over 70 "test and
trial" projects running throughout England. Cornwall is a big part of this with five
trials and Cornwall Council has been selected as one of five areas to pilot a
Nature Recovery Network which aims to benefit people and wildlife by increasing
and joining up wildlife-rich sites.
Defra's Farm
Business Survey for England 2019/20 shows the potential risk to farm businesses
of these changes, particularly in the grazing beef and sheep sectors that
predominate in Cornwall. Lowland grazing
livestock in England shows an annual farm business income of just £9,400 on
average but it is the make up of this that is most worrying. The contribution of the beef and sheep
trading part of the business is negative and it is predominantly the Basic
Payment Scheme payments that puts the business in any profit at all.
As these payments
are phased out it seems unlikely that payment for the provision of public goods
will be enough to give many farmers the income to remain at even a low level of
profit.
This is important across the country but particularly so in Cornwall and
the Isles of Scilly where agricultural activity covers an estimated 80% of our
land mass and the agri-food sector accounts for almost 33,000 or 14% of all jobs
and £1.4 billion, or 15.5%, of GVA, as well as linking so strongly with our
tourism and hospitality sectors through our strong food and drink culture and
reputation for quality.
While recognizing
that Government trade policy and attitude to UK food production will be
critical, if farm businesses are to survive and thrive farms must seize the
opportunities and adapt. Large improvements
in farm productivity will be needed along with good business management and a
willingness to look at new ways of doing things, new markets and new business
models. New entrants must be encouraged
into the sector.
Although ELMs is likely to offer some support to farmers to adapt their
businesses to the new opportunities in environmental management, the LEP and the
Cornwall and Isles of Scilly Local Nature Partnership (LNP) recognise that this
is only part of the issue.
Farmers cannot be expected to make decisions about environmental land
management in isolation of their main farm enterprise, investment, succession
planning, diversification or perhaps even leaving the industry.
That’s why we’re working with the LNP and many others to explore whether
it would be feasible to pilot a farm advisory service to help farmers make
decisions not just about ELMS, but more widely by developing whole farm plans.
We want thriving businesses that contribute to sustainable food production
with improved biodiversity and net carbon zero impact. That should be a huge
opportunity for Cornwall and the Isles of Scilly but we must help our
industries adapt so that they can remain profitable while being expected to
improve the environment on which they and other sectors like tourism also
depend.
The LEP has
convened a broad group which includes the Local Nature Partnership, National
Farmers Union, Prince’s Countryside Fund, Farm Cornwall, Cornwall Council and our
Universities and others to look in detail at what support can be put in place
to help our farming community respond to the biggest change in land use policy
for more than 50 years.
Clare Parnell is a farmer in North Cornwall and agri-food specialist. She is a LEP main Board member and chairs the LEP’s Rural Group.