News in brief: February 2023

January is usually a month for planning the year ahead – a chance to think about objectives and projects you’d like to tackle.

Opportunities for farmers and estate owners to do this within their businesses were, however, somewhat constrained by ongoing volatility and uncertainty in key areas, not least government policy. Resilience is, once again, going to be key – something that landowners have become well acquainted with over the past few years. Here are some of the main stories affecting rural businesses this month. 

Changes to ELMS “too little, too late”?

Further changes to ELMS were announced by Farming Minister Mark Spencer at the Oxford Farming Conference with detailed plans released by the government later in the month. Environment Secretary Thérèse Coffey announced an accelerated roll out of the Sustainable Farming Incentive and detailed what farmers will be paid to deliver through an enhanced version of the Countryside Stewardship Scheme. “Farmers are at the heart of our economy - producing the food on our tables as well as being the custodians of the land it comes from,” Ms Coffey says. “These two roles go hand-in-hand and we are speeding up the roll out of our farming schemes so that everyone can be financially supported as they protect the planet while producing food more sustainably.”

Output costs expected to remain high

Prices for fertilisers made using gas are expected to remain at record levels in 2023, new analysis indicates. Data from the Energy and Climate Intelligence Unit (EICU) suggests that farmers could be paying an extra £1.1 billion for nitrogen and phosphate fertilisers from 2021-2024 due to high gas prices.

Matt Williams, land use analyst at ECIU, says: “Farmers are staring down the barrel of another tough year. The price of fertilisers made from gas remains at historic highs meaning Britain’s farmers could pay hundreds of millions of pounds extra this year compared to more normal prices.”

Government ‘undermines’ farming industry in review of scheme

The government’s decision to classify farming businesses as ‘non-high energy businesses’ in a review of its Energy Bill Relief Scheme has been widely criticised. NFU Scotland says it will continue to press for all agricultural businesses to be eligible for the higher rate of relief as it believes that failure to extend the highest level of support to agri-businesses would condemn consumers to a further escalation in food prices.

“Support at processing and manufacturing level for electricity costs is most welcome but unless you back that up with the same level of support at farm level for production and on farm storage, then providing the raw materials for our processing and manufacturing sectors will further decline,” says NFU Scotland President Martin Kennedy.

New strategy seeks to protect crops and plants from disease

In a bid to protect domestic food production, the government launched a new five-year strategy to protect crops and plants from pests and disease. The Plant Biosecurity Strategy for Great Britain sets out a vision for a new biosecurity regime and bio-secure plant supply chain, which the government believes will safeguard food security and help mitigate the effects of climate change.

Nicola Spence, UK Chief Plant Health Officer, says: “Plant pests and diseases know no borders. As the global trade in plants and plant products continues to grow, our precious ecosystems, native species and biosecurity are at risk. The resultant threats posed to our treescapes, food security and the global economy are all too real.”

Milk prices under pressure

Farmgate milk prices enjoyed a year of record-breaking price increases in 2022, but experts believe this positive run is coming to an end. Changes to the milk price so far in 2023 have all been downwards, with just one exception, marking the first reductions in almost two years. “Assuming the typical lag of three-four months, milk prices are projected to see further cuts as we move into the spring,” says AHDB lead analyst Patty Clayton. To date, almost all the major milk processors have announced price cuts for either February or March.