Rural Advice
More joined up thinking for farms of the future Carter Jonas partner Mark Russell takes a look at the future of farming in this country and anticipates an increase in farm amalgamation and mutual co-operation.
Planning has long been the lynchpin of successful farm management and agricultural profitability. While some facets of the industry are short term in approach, we work with clients to consider 5-year and then 10-year plans. This provides a firm structure for the future and stability to safeguard against periods of flux. So what will farming look like in the next decade? While the technology we use may be similar to what is used currently, profitability will increasingly be driven by efficiency and specialisation. The industry has moved towards efficient uses of power and labour since the advent of agritech, while identifying a niche is a fundamental tenet of many businesses’ success. In addition, business profitability will be driven by yet further diversification – whether in skills or alternative uses of land, buildings and assets, as well as vertical integration. From a farming perspective, where one is growing a commodity, the emphasis will need to centre
around a reduction in costs and could initiate the emergence of agricultural collectives. While we currently consider a 400ha arable business to be a substantial operation, I anticipate a rise in thenumber of large businesses which amalgamate and streamline their operations.
Collaboration The good news is that this doesn’t necessarily signify wholesale industry job losses, but it will demand more joined up thinking. We can certainly foresee a dozen farms of 400ha each working together as a single conglomerate with individual farmers taking responsibility for staff, machinery, purchasing, selling, crop husbandry, environmental and grant management, land asset management, and diversification and business development. While this might sound like a surplus of management, 4,800ha could turnover upwards of £6m annually, and it will of course require the
investment of adequate time to make it work properly. Which raises a challenge: can you identify 4,800ha near you, which is currently managed by people with who you would happily work in partnership? By contrast, if you were asked to identify land that you would be happy to contract farm, the answer would be much easier. Perhaps the problem is not finding the right land or even the partners; perhaps we need to think beyond the limits of the status quo and consider a different approach beyond the current mind-set.
More managers If we were to scale up the above to 9,700ha, it would be easy to consider a farming enterprise of this size demanding a number of managers, each with a specific focus, whether business management, individual crop types, and so on. However for this to work, there would be a need to adopt a new way of thinking, replacing the norm with an even more focused business approach to farming, either by deploying each individual’s skills into running the business, or by contracting in those business skills to make it work.
Conversely, at the other end of the spectrum, where niche products are being sold, there could be greater emphasis on directly fulfilling customer demand to drive profitability. Perhaps the current debate around growth hormoneproduced beef or chlorine washed chicken carcasses entering the UK market will ignite even greater interest in, and lead to, a larger market for individual, farm-sourced meat. This would give customers greater transparency over the provenance of their food. Much in the way that vegetable boxes are now delivered in the manner of a traditional green grocer, perhaps we will see known source meat packs delivered in a similar way. Inevitably, the next 10 years will bring many opportunities for farmers looking to grow their business. To achieve this, there needs to be further separation of land ownership from farm business management (with various ways of achieving this), so that the farming business can completely focus on the issues impacting on profitability. Mark Russell is a rural partner in the Carter Jonas Cambridge office –mark.russell@carterjonas. co.uk; 07967 555737. ■
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