Amid growing concerns about farm incomes, CKD Galbraith, a Scottish firm which provides advice on managing farm estates, has said farmers should do more to ‘grasp commercial opportunities which could transform their businesses’.
The latest farm business income figures released by Defra at the end of October showed a dramatic fall for the third consecutive year, with sectors such as dairy and pigs seeing their incomes halved.
Simon Brown, head of the CKD Galbraith’s farm sales division, said: “There is a golden opportunity for farmers to make their greatest asset – their land – work better for them.
“This is not about diversification in the traditional sense or a criticism of farmers. It is about seizing the commercial opportunities that are undoubtedly there but many farmers have not thought of – mainly because they are too busy doing the day job or have only considered the possibilities which exist within their own farm boundaries.”
The Government has encouraged farm diversification as a way of increasing income. Funding has been offered for projects which boost tourism and money has also been made available to farmers who wanted to set up farm shops, ice cream parlours and camping sites.
But Mr Brown said a ‘great number’ of farmers could generate another income stream without having to undertake and operate another activity.
“How many farmers stop and question whether part of their land would generate more income if it was used to plant trees rather than running commercial hill ewes, that in turn would be eligible for a grant? Or how many consider whether they have minerals or a site that could generate cash if it were designated development land in the local development plan?
“Even the renewable energy sector, which is not as attractive as it once was, can still offer good returns through combined heat and power plants, biomass and battery units for electricity storage”, he added.
Mr Brown also suggested farmers could even consider using historically low interest rates to their own advantage.
He said: “There is every chance farmers with significant equity in their property can borrow at around 3 per cent or less. The cash could then be invested in commercial ventures which could yield 8 per cent return on investment, and that could transform the income of a farm business”.