Wednesday, 2 January 2013

Bad weather, and how it affects farming

As we enter 2013 there seems to be no end in sight to the incessant procession of depressions sweeping across the Atlantic to deposit their rain on the British Isles and here in the South West we appear to have been at the vanguard since the rain started last April.

This is not only tedious for us all but it is becoming an increasing concern to farmers. For example, many arable farmers were unable to sow cereal crops in the autumn and are now looking to source seed for crops that can be sown in the spring, which I can only imagine will soon be in short supply and consequently expensive.

Livestock farmers are also finding the weather hard work. They struggled all last summer to grow and harvest quality forage crops to feed cattle during the winter. Those forage crops which have been harvested are generally of limited quality and in some instances maize crops still remain un-harvested in the fields.

On the upside, commodity prices generally remain high but if the weather does not improve soon it will impact arable farmer’s ability to cultivate their land for spring sown crops and livestock farmers will hope that the winter is not too long because this will put pressure on fodder stocks.

So what are the prospects for the coming year? Well, it goes without saying that farmers will wish for “kinder” weather in 2013 than they saw in 2012 but they will also hope that commodity prices will remain firm. The latter will largely depend on production levels across the world which will again be influenced by the weather.

Another important matter on which farmers will be keeping an eye on this year are the ongoing talks in Europe concerning the next round of reforms of the Common Agricultural Policy (CAP). It seems that these will now not be introduced until 2015 but it is likely that the detail of what these reforms will entail will start to emerge next year; the expectation is that support payments for agriculture will fall and so farmers must prepare their businesses for this. This will be a particular challenge for livestock farmers, many of whom still rely on CAP support payments to make a profit.

So what can farmers do about any of these challenges? Well nothing directly because the weather, world commodity prices and EU policy are all out of their control and so they need to concentrate on what they can control themselves. They must understand their businesses, bench mark their performance against others, continuously improve their technical competence, optimise production, control costs and monitor their financial performance through budgets and cash flows.

The farmers who will survive and prosper in to the future are those that have a real grasp of their own business, a clear understanding of which enterprises are making money and which are not and a preparedness to adapt to whatever the weather or EU throws at them in 2013 and beyond.

James Stephen MRICS FAAV
Rural Practice Chartered Surveyor, Wells

T: 01749 683381

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