In 2014, I was an Agricultural Bank manager for a high street Bank. I was asked to write a personal report on how I viewed the Agricultural industry at that time. At the time it was intended to be read by senior people inside Banking that had little or no experience or knowledge of the UK’s Agricultural Industry. It ended up being read by several politicians and senior clergy. In it I was also asked to look ahead to issues that will hit farmers over the next three years. Whether my insights were correct are for the reader to judge. But I do feel we are in a greater challenging period for the industry which is what made me share this publicly.
As I write this on 12th January 2014 farming businesses throughout Lincolnshire are just coming out of two of the toughest years in living memory. Whilst this is a generalisation there have been very few businesses that have not suffered some consequence due to a combination of drought, too much rain, and/or crop failure. Even those without arable crops have been affected as feed costs for animals has increased. In horticulture there has been pressures caused by a lack of daylight, last year’s cold winter and cold spring resulting in a combination of heating costs or reduced growth, resulting in slow growth and loss of opportunity as one or more crop cycles have been lost. On top of this has been problems that everyone has encountered as cost of living has increased, incomes from both earnings and savings have dropped, and life has become a little more difficult for us all as public resources tighten.
Against all this, I am lucky, as an employee of a large PLC if I am sick, I get paid; if I need medical attention I have private health insurance; I have a company pension and savings schemes. However, this does not mean I lose sight of the reality of others. Since October 2012 I have kept a brief note of the numbers affected by the conditions we have experienced. I have encountered from then to date 134 people with varying degrees of difficulty. Many of those have been in a good position to help themselves, especially if they have historically strong businesses and a good asset base, or have the ability to adapt. About a third of them have not been in that position and five have been beyond the ability for me to help them continue.
The problems of the last two years have taken a physical and emotional toll on many. I have seen farmers that have considered suicide as a solution as they have totalled up their life policies. I have seen a farming couple in tears as they have experienced a total failure of a rape crop, and feared that this would ruin their future plans for the farm. I have seen tenant farmers fear their homes are in jeopardy, in some cases more than one family’s home. I have seen farmers clinically depressed, unable to see a way forward. Some have turned to alcohol, or simply isolated themselves from their friends and neighbours without realising they can help. I have seen farmers reducing livestock levels in order to afford to feed their stock. I have seen some make the tough decision to retire rather than battle on. Many a time I have had to remind farmers that one or two bad years does not make them a bad farmer or a bad business.
We must remember it is not just farmers that have been affected. Agricultural contractors have suffered from lack of work due to bad weather. Agricultural machinery manufacturers have laid off workers, and sadly we saw the end of Marston trailers near Grantham. Farm workers have had to work prolonged hours, especially in harvest 2013 which was prolonged, with a relatively warm winter increasing the work load.
At the same time I have seen great generosity. I have seen farmers donate feed when they have had to buy it themselves. I have seen farmers lend kit and labour gratis to struggling neighbours. I have seen professionals give their time and expertise. What concerns me are those that are unknown. I met a farmer that has refused to ask for help as he has been disabled and his family have struggled on unwilling to ask for help. It is very easy to read the news and read about the figures but what really counts is the effect on people. A cost that cannot be easily measured.
If I was to look ahead the key issues that will hit farmers over the next three years or so will be:
1. Information technology, bureaucracy, and lack of effective broadband. I am increasingly seeing government agencies and companies pushing all avenues of business down the internet route. Banking, VAT, cattle movements, single farm payment, all require internet access and the need for this is ever increasing. All this is happening despite the fact that only about a third of the rural and farming businesses that I know have an effective and useable internet service, or the knowledge and ability to use it. The steamrollering of internet services regardless of ability to access them is a national scandal that greatly disadvantages rural communities. On top of this, for farmers, is an increasingly complex level of bureaucracy which many now feel is beginning to overwhelm them.
2. Water and soil management. The weather of the last two years has increased the need to store water when it is in surplus and drain it away effectively without eroding soil when it is in surplus. The retention of nutrients in soil is a challenge and a likely increase of expense.
3. Reliance upon one person. This is not just a problem for the traditional farmer, but also key employees or farm managers. Mechanisation has enabled more to be done by one person, resulting in most farms being reliant upon one person. On bigger farms this is different in that a key employee or farm manager will carry the can. However, I have seen many under pressure especially in harvest 2013, that has been a prolonged harvest without break and increasing winter work in a mild year. It has to be remembered that many Lincolnshire farms are too small to provide a good level of income for one family, and those farmers have to do work for neighbouring farmers, have second jobs, or diversified. Businesses need to supply enough income. The pressure on the main breadwinner is great.
4. Increasing costs. Working capital costs on the whole are increasing at a greater rate than the profits that potentially can be obtained from the end produce. This is especially important to tenant farmers. I am pleased to see an increasing number of responsible landlords recognise that they are not taking the risk of farming. But there is great competition for farmland. Machinery is becoming more expensive to purchase and maintain. All this is not helped by the reduced choice of sources of finance that has happened in the last five years, although I do see this beginning to improve.
5. Ability to change. Whilst farmers are innovative, the pace of change is such that they will have to make tough decisions to change more quickly than in the past. This can be emotionally tough on a farmer that has seen many generations of his family farm before him, and they feel a duty to continue and pass on the business unchanged to the next generation regardless of whether they wish to follow on!
6. Artificial markets. These are a challenge in various forms. Energy policy is encouraging farmers to undertake energy projects. But this has created a whole sea of confusing information, and in that sea are a few sharks! It will only be a matter of time before a wind turbine manufacturer, a solar provider, a straw trader, or a trader of maize to AD plants over-trades and goes bust with some poor farmer incurring a resulting loss. Farmers are having large amounts of money offered to them to allow maize to be grown on their farms. This may store up a problem for future crops as the risk of mycotoxins is high especially in eastern England. I also believe that as maize is grown in the UK and Lincolnshire in ever larger quantities the risk of disease and resultant crop failure will increase. On a separate note I have seen farmers participating in energy projects become victims of hate campaigns and the worst of human behaviour.
7. Increased competition and expectations of farm employees. This year I have encountered seven cases where employees have been expected to work in excess of 14 hours a day without break for several weeks or loose their jobs. I have also encountered employees working extra unpaid hours due to them operating worn out knackered machinery. Many farm workers of middle age are in fear of a growing band of young, capable immigrants that are prepared and able to work long hours at a level of pay that would not support a conventional family and increasing overheads that we all experience as cost of living increased.
8. This final issue is of greater longer-term concern. Farmers and farm workers are increasingly losing their ability to save for their retirement. Even those that are able to make some provision cannot find investments that will perform reliably enough to provide a retirement fund. On top of this is an increasing likelihood that hard work will wear out their bodies and restrict their ability to earn before a retirement income can be drawn. The potential for future poverty is great.
Please consider reading this that all is not gloom. Farming has great opportunities for many and is a growing industry. Beef, poultry and arable farming are all flourishing and providing an increasing range of employment and business opportunity. However, in this writhing I have focused on some of the human costs and difficulties.
All views are mine own only.
Andrew
It is hard to imagine that as I wrote this in 2014 the storms of Covid, Brexit, Banking Support, and a regime change in farming were only six years away. As already said, whether my observations were correct or not are for the reader to judge. However, what does concern me is the price individual people are will continue paying in various forms and pains.
Remember you are not alone and there are many people out there to talk to, whether friends and neighbours, professionals or one of the farming support charities:
FCN – FARMCOMMUNITY NETWORK tel: 03000 111 999 email: help@fcn.org.uk
SAMARITANS tel: 116 123 email: jo@samaritans.org
LRSN – LINCOLNSHIRE RURAL SUPPORT NETWORK tel: 0800 138 1710 www.lrsn.co.uk
Or view the organisations in the booklet on this link: