In the latest of a series exploring the work of AHDB, Farmers Guardian examines the levy board’s Brexit calculator and how farmers can use it at a time of such uncertainty.
With Brexit on the horizon, many farmers are feeling unprepared about what the future holds.
However, a new online calculator from AHDB allows farmers and growers, for the first time, to see how they may be affected by potential Brexit scenarios.
For farmer Conor Colgan, the new tool has allowed him to better understand the predicted impacts of subsidy loss and tariffs and prepare for the challenges ahead.
As a pedigree Salers and combinable crops farmer in a family partnership of 336 hectares in Northumberland, Mr Colgan has a wealth of knowledge about the industry, but like many, remaining profitable in a post-Brexit world is a grey area.
He said: “There are a lot of unanswered questions with only six months to go until we leave the European Union. I wanted to know about the potential impact of Brexit on my business and find out how I can better prepare for the unknown.”
The calculator is part of a wider toolkit which analyses five key areas of the business, including being efficient with resources, profit and performance, as well as financial management and planning for the future.
It allows individuals to input their own data and see what effects three different Brexit scenarios might have on their business.
Mr Colgan said: “My first impression was that it was nice and clear on screen, it draws you in and is not too complicated. It is very simplistic in its design and easy to follow. It lays out the three scenarios quite clearly which is the crux.
“It is quite surprising to see the potential impact of these scenarios on your business and also a little bit concerning if you have not explored this before.
“I would encourage all farmers, regardless of size or sector, to use this new calculator as it provides valuable insight into how your own farm business could be affected once we leave the EU next year.”
AHDB market intelligence director Phil Bicknell said: “It is great to see farmers and growers making full use of our new Brexit Impact Calculator. In the last few days, we have all picked up on a bit more detail of the future policy framework, but the landing zone is far from certain.
“As more detail becomes available, we will continue to update the calculator and our range of tools. We can start to put together pieces of the jigsaw and have a better idea of what Brexit will mean to our business.”
BREXIT, to a certain degree, was having a ‘hold’ effect on investment and develop- ment within agriculture, according to Barclays banks. Therefore, taking a look at how your business might be affected within three scenarios is the beginning of planning for the future.
The bank’s main advice was to be in touch with your business, your input costs and output income, and be aware of the effects of different drivers on profit.
Change is always unsettling, but the bank said it should not be used as an excuse not to plan and develop your business for a sustainable future.
This is where AHDB’s Brexit Impact Calculator comes into play. The three scenarios might not be where the industry ends up, but they can give an idea of what effects different levers will have on a business.
The sooner they are understood, the sooner the business management can start to steer through the change successfully.
This tool gives an understanding of the effects of trade agreements/tariffs, labour costs and subsidy income to your busi- ness and, armed with that information, business managers can make informed decisions.
Anything which gets a business more in touch with their figures is a huge help to the longer term business management, so if using the calculator is a first venture into delving into more detailed finances of the business, hopefully it will encourage farmers to become even more engaged with cost of production and efficiency.
For more information, go to ahdb.org.uk