A new beginning

In years gone by, the day after the September quarter day was regarded as the beginning of the new farming year - the harvest would have been garnered and preparations would be well in hand for the coming, possibly severe, winter months.

A Land Agent friend reminds me that yesterday, September 29, was Michaelmas Day, which might normally have meant that tenant farmers might have anticipated receiving a dreaded rent review notice!

“But why should it be this way?” he poses the question, “With the current state of the agricultural markets should not tenants be serving notices on the Landlords and look at the possibility of a rent reduction?”

He goes on: “Traditionally, if the rent was to be discussed the tenant is the one to lose and end up paying more. Over the past few years we have seen un-sustainable rents tendered for agricultural land. Rents over £200/acre have been common across the region even reaching £250/acre, plus for regular grade three arable land.

“When I discuss rents with my clients they all agree that this level is not healthy for a business or the agricultural rent market. So why are we not seeing more honest rents? Well I believe we are! We are stilling seeing high rents tendered but recently these are back in the region of £175/acre rather than £250.

“Tenants are willing to pay a competent agent to negotiate with the landlord for a serious rent reduction. Where a landlord understands the value of a capable tenant negotiating a reduction in today’s market can be a much more amicable affair.

“With wheat prices hovering around the £100/ton mark farm business finances need to be under close scrutiny and this includes the farm rent. If the farm is efficiently only making a £80/acre profit before rent then it does not make business sense to be paying £160/acre rent.

“The argument I always here is my agent fees will be more than the rent I save! This may be true, but a good agent will be able to manage expectations and know if the discussion is worth having. In terms of figures if you rent 150 acres at £200/acre and your agent can negotiate a reduction of £20/acre saving you £3,000 per annum on rent then a fee of £2,000 would still see a saving, along with a reduced rent for the next couple of years.

“Any tenancy should be fair and the majority of landlords or their agents will understand the current market and should be willing to discuss rental levels.”

Desperate measures

This summer has seen milk production across the UK fall to its lowest daily rate since milk quotas were abolished and the indications are that further large scale reductions may be inevitable.

With final seasonally adjusted milk EU production figures for July not yet available, there are very strong reasons to expect, not least due to rising costs to the farmer, of an accelerated slowdown in farm output.

The UK, Poland and Denmark have all recorded year-on-year reductions for July and decreases are also expected in the two largest milk producing Member States, Germany and France. Production in Ireland and the Netherlands is still running above last July, but both have slowed considerably in recent months.

The market outlook is, seemingly, now improved and with significant positive moves in recent weeks, the NFU’s Milk Board for Wales has been very forthright in its view that much more money should now be coming back to farmers and that processors are clearly ‘dragging their feet’ in this respect.

The gap between most producer prices and commodity prices is now quite significant - all the price indicators point towards a farm gate price of 25 pence per litre if not more, yet the reality for most farmers is that milk prices are still around 20p or less.

This all points to the conclusion that processors are very slow to respond to market improvements. When the market takes a downturn, farm-gate prices respond immediately and processors reduce their price overnight!

I hear platitudes that processors and end users have sympathy for producers’ plight and much of this will be genuine, but the speed in reflecting positive market increase in value is simply not quick enough and farmers rightly expect to see a fair share of any improvements in markets returned to their own balance sheets and not held back higher up the supply chain.

The EU has just finalised the details of its scheme to pay farmers to reduce milk production, which could lead to further reductions in supply over the coming winter as European Commissioner for Agriculture, Phil Hogan, expects a strong uptake for the 150m euros in EU funds to be made available to farmers who cut milk supply.

Hogan says: “There is a huge interest in this particular scheme where we are trying to bring about balance between supply and demand in the milk market. If the milk market doesn’t achieve balance, we won’t have a higher price for the farmer.”

Farmers will have an opportunity to enter the scheme in October, November and December and with certain conditions attached, it is anticipated that producers will be paid 14 cents for every litre of reduced production compared to last year.

A further 350m euros of ‘targeted aid’ for farmers around the EU will be distributed to each individual member state on their own conditions, with an option for each country to match it with national funds.

Diary of a farmer’s wife

Behind every good farmer is a great farmer’s wife though the farmer in question may not always appreciate this!

Having been married to John for over 30 years, Bobbi Mothersdale knows this more than anyone. Through her diary, Bobbi gives a wry, comical and yet realistic account of life on their East Yorkshire farm.

Over the course of the year, we meet her friends and family, as well as the three dogs, numerous hens and crafty guinea fowl that play such a big part in their daily routine.

Like any farming family they have good days mixed with bad and have to deal with adverse weather, bureaucratic challenges and uncooperative livestock.

Bobbi’s accounts of her irate farming husband thwarted once again by the gods of rain or a petulant sheep will be instantly recognisable to anyone who has ever worked on a farm and on many an occasion you will find yourself laughing out loud at her description of the situations she finds herself in.

Illustrated with 24 beautiful sketches by Jacquie Sinclair, Bobbi’s dry and witty way with words can not fail to amuse and endear you.

Bobbi says: “If you are a farmer’s wife, you will find this an unputdownable must-read that you will want to share with all your friends. Though be warned - you might need to prise it away from your husband and his friends first…”

Think positive

It may seem a distant memory now, but wasn’t the weather on the August Bank Holiday amazing?? Unbelievable....! I hope you had the chance to enjoy it. Good weather, summer hols, ice cream and bronzed faces are fun, enjoyable and magical times for family, loved ones and recharging your batteries.

As the kids are now back in school, and already anticipating half-term, your thoughts will inevitably be turning to the months ahead and your business. A change in the seasons is nature’s timely reminder to get our house in order and prepare for the next quarter. To embrace the change and make the most of every day.

How much can you achieve before the end of 2016? The answer may be more than you may think! Lack of self belief is such a natural default. Coming up with excuses; blaming situations over which you have no influence and denying personal responsibility. In time this creates a sense of anxiety, anger and frustration which becomes the source of procrastination.

When you believe in yourself, you take action and see results. Your confidence grows and achieving your potential becomes an inevitable voyage of discovery.

Here are three ideas which have been suggested to me (by a reader of this column) to help you get started to build your motivation, improve your confidence and help you to achieve more than you thought possible:

1. Set yourself a challenge -it’s very easy to carry on doing what you’ve always done working to the mantra ‘If it’s not broken, why fix it?’. But in today’s fast-paced world, that actually means you’re going in reverse.

We naturally reject the notion of pushing the envelope as the inner demon of fear takes over….” What happens if this doesn’t work?” “If I don’t achieve my goal, I’ll look a failure…” There is no single formula for success. Nobody has walked in your shoes before so your path is completely unique. As you set yourself your challenge, recognise that this may involve taking small steps and some learning from others may be required along the way.

Be specific in what you would like to achieve and commit to attaining your goals. Identify and note down a personal best to beat in terms of new business wins, new product developed, amount of product/service delivered. Be bold and ambitious and start taking action right now.

2. Make every day count -it’s widely recognised that successful people have certain routines in common with which they kick-start every day. Rising early and beginning each day with a simple ritual will get you into the right mindset to empower you for greater success.

There are many self-help books available on this subject and the choice is quite bewildering. If you are committed to personal development and getting yourself into the right frame of mind I would recommend you utilise the mindset tools from the best-seller The Miracle Morning: Silence, Affirmations (including reading your identity statement), Visualisation