As harvest draws to a close and cultivations in readiness for sowing next year’s crops are well under way, farmers still face considerable uncertainty as to what they will need to do in order to comply with the new Basic Payment Scheme (BPS) rules.
As most readers will be aware the Single Payment Scheme, which is the existing EU support scheme for farmers, will be replaced by the BPS from 1st January next year and in so doing farmers will need to comply with a whole raft of new rules, many of which seem to me to be entirely pointless. However, compliance with these new rules will be necessary if farmers are not to lose out on support payments next year.
It seems likely that with many agricultural commodity prices at low levels, these EU support payments will be even more important next year in order to balance the books. However it is frustrating that following the publication of the latest update from DEFRA on the new rules, there are still many questions left unanswered.
In particular some of the rules surrounding Ecological Focus Areas (EFAs), that form part of the “Greening” measures which will affect many arable farmers, are not entirely clear. Under these rules, farmers with more than 15 hectares of “Arable Land” may have to put 5% of their arable land in to an EFA.
The simplest way to do this is to “set aside” 5% of the Arable Land as “fallow”. But care is required to understand both the definition of “Arable Land” land and what will qualify as “fallow”. I do not have space to deal with these complexities here but suffice it to say one can end up with some rather counterintuitive results, which for example will allow temporary pasture to qualify as fallow provided it is not cropped or grazed between 1st January and 30th June. It seems to me this will achieve absolutely nothing of benefit for either farmers or the environment.
Another option is using hedges as a means of claiming the 5% EFA. However, the rules in relation to hedges seem even more confusing. At present it seems clear that if a hedge is bordered directly by arable land in the ownership of one farmer, then the hedge can be claimed. However, if the hedge borders permanent pasture, a road or a neighbour’s land on the other side, it is not clear whether this hedge can be used to contribute to the EFA and if so to what extent.
Further guidance is awaited on this and many other points of detail from DEFRA and so my advice to farmers is to keep things as simple as possible in the first year of the new scheme and plan next year’s cropping on the “knowns” rather than waiting for DEFRA to define the “unknowns”.
James Stephen MRICS FAAV
Partner
Rural Practice Chartered Surveyor, Wells
T: 01749 683381
E: james.stephen@carterjonas.co.uk
A property blog written and authored by our specialist blogging team, discussing all and any matter relating to the residential, rural and commercial property markets.
Showing posts with label EFA. Show all posts
Showing posts with label EFA. Show all posts
Tuesday, 2 September 2014
Monday, 21 July 2014
Arable prices at their lowest for years
As harvest begins, arable prices have fallen to their lowest levels for some years. “Farmers Weekly” figures for last week show feed wheat trading at around £132/t as compared to £162/t a year ago, and similarly feed barley trading at £107/t as compared to £140/t and Oilseed Rape at £235/t compared to £320/t.
In this area I have only seen winter barley being harvested to date although having been in Oxfordshire last Friday I did see combines rolling in the first fields of oilseed rape. It is too early to comment on crop yields but with prices where they are, farmers will need a bumper harvest to prevent significant losses.
Anecdotal evidence from the farmers I have spoken to indicate that although the crops look good, some have suffered from the very wet winter which has impacted yields, particularly on the wetter land while crops on more free draining land have fared better.
In addition to concerns over commodity prices and yields, farmers are also faced with another raft of decisions to be made concerning next year’s cropping which need to be addressed very soon. This is because next year will see the introduction of new rules for European support payments as the Single Payment Scheme is replaced by the new Basic Payment Scheme.
Allied to this scheme are a raft of new “greening measures” to which I have alluded in previous articles. These measures require arable farmers to observe new rules concerning crop diversification and the introduction of so called “Ecological Focus Areas” (EFAs).
Complying with these rules will be predictably complicated and what is clear is that farmers will need to make decisions very soon while the detailed rules are only just emerging. This is further complicated by the fact that the EFA rules will also impact on the payments received by some farmers under existing agri-environment schemes.
In addition many arable farmers who farm land on a “contract farming” basis will now need to treat these areas as a separate holding from their own land. This may sound simple to the uninitiated but it has the potential to threaten the viability of some long standing contract farming arrangements. As a consequence there will need to be detailed discussions between the landowner and contractor in the coming weeks if the payments due under landowner’s Basic Payment Scheme claim in 2015 are not to adversely be affected.
So, after a reasonably good run over the last few years arable farmers are faced with not only low commodity prices but also rule changes from Brussels which will make things more complicated and expensive with no obvious upside for anyone.
If farmers or landowners require advice on this matter they are welcome to contact James Stephen on 01749 683381.
In this area I have only seen winter barley being harvested to date although having been in Oxfordshire last Friday I did see combines rolling in the first fields of oilseed rape. It is too early to comment on crop yields but with prices where they are, farmers will need a bumper harvest to prevent significant losses.
Anecdotal evidence from the farmers I have spoken to indicate that although the crops look good, some have suffered from the very wet winter which has impacted yields, particularly on the wetter land while crops on more free draining land have fared better.
In addition to concerns over commodity prices and yields, farmers are also faced with another raft of decisions to be made concerning next year’s cropping which need to be addressed very soon. This is because next year will see the introduction of new rules for European support payments as the Single Payment Scheme is replaced by the new Basic Payment Scheme.
Allied to this scheme are a raft of new “greening measures” to which I have alluded in previous articles. These measures require arable farmers to observe new rules concerning crop diversification and the introduction of so called “Ecological Focus Areas” (EFAs).
Complying with these rules will be predictably complicated and what is clear is that farmers will need to make decisions very soon while the detailed rules are only just emerging. This is further complicated by the fact that the EFA rules will also impact on the payments received by some farmers under existing agri-environment schemes.
In addition many arable farmers who farm land on a “contract farming” basis will now need to treat these areas as a separate holding from their own land. This may sound simple to the uninitiated but it has the potential to threaten the viability of some long standing contract farming arrangements. As a consequence there will need to be detailed discussions between the landowner and contractor in the coming weeks if the payments due under landowner’s Basic Payment Scheme claim in 2015 are not to adversely be affected.
So, after a reasonably good run over the last few years arable farmers are faced with not only low commodity prices but also rule changes from Brussels which will make things more complicated and expensive with no obvious upside for anyone.
If farmers or landowners require advice on this matter they are welcome to contact James Stephen on 01749 683381.
James Stephen MRICS FAAV
Partner
Rural Practice Chartered Surveyor, Wells
T: 01749 683381
E: james.stephen@carterjonas.co.uk
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