A massive 80 per cent of rural businesses are expecting their profits to fall in 2020 due to the coronavirus pandemic, according to the latest Rural Sentiment Survey from Knight Frank.
More than a third of businesses – 35 per cent – said their profitability would be ‘significantly’ hit.
Farmers who are heavily dependent upon tourism or leisure enterprises are braced for a serious drop in revenue, while those who rely on more traditional sources of income anticipate lower losses.
Just under 40 per cent of those taking the survey had shut down elements of their businesses, and a similar proportion said tenants were struggling to pay their rents.
More positively, only 8 per cent of respondents believed their long-term viability was under threat, with many still making plans to expand or diversify their businesses and tap into concerns about the environment and climate change.
Almost 40 per cent said they wanted to dedicate more land to conservation, while half plan to plant more trees.
The global property consultancy surveyed 300 farmers, landowners and other rural businesses as part of its tenth Rural Report.
Clive Hopkins, head of farms and estates at Knight Frank, said: “Covid-19 has ruthlessly exposed vulnerabilities within the rural sector to diminishing cash flow.
“How economic recovery will look in 2021 is uncertain and now is the time for all businesses to look under the bonnet in a strategic way.
“However, some positives will undoubtedly emerge. Real assets, such as land, will likely become increasingly attractive for investors, which is when farmland and forestry will come into their own.”
Other findings from the survey showed many respondents were positive about the future for locally-produced food, with 64 per cent predicting its popularity will remain high after lockdown.
Despite this, only one-fifth think the Government will place more emphasis on food security over the coming years.