Diversification will be key for farmers as subsidies are cut and land values fall, a leading Suffolk lawyer says.
Claire Barritt, senior associate at Ipswich law firm Prettys, urged farmers to revisit their business plans to ensure they are not caught out as Britain leaves the European Union (EU).
The value of commercial farmland is expected to fall by 3.6% in the wake of Brexit, she said.
MORE – UK pig sector ‘should expand over time’, feed firm predictsOne of the major challenges facing British farmers is a possible reduction in farm subsidies, she warned. Environment secretary Michael Gove is planning a radical overhaul of the system, arguing it offers too much help to larger farms and not enough to smaller ones. He wants to bring in a ‘public money for public goods’ approach, delivering environmental benefits such as clean water, flood prevention and wildlife preservation.
Farms can prepare for the financial impact of post-Brexit changes by diversifying, said Ms Barritt, who discussed Brexit and the agricultural landscape at Prettys’ Developers’ Club gatherings at Essex County Cricket Club and at Suffolk Food Hall.
“We still don’t know for sure what the long-term subsidy strategy of the government is going to be post-Brexit,” she said.
“If, as expected, subsidies are reduced, then farmers will certainly have to look at diversification and efficiencies in how they run their businesses.”
Opportunities to raise additional income could include growing different crops, converting redundant barns to residential property and looking at ways to create commercial property as well as tourist accommodation, she suggested.
“An emerging school of thought is that the EU subsidy regime may have stifled innovation and entrepreneurial decision-making among some farmers.”
Ms Barritt was joined by William Hargreaves, director at estate agents Savills’ Ipswich office, at the Suffolk Food Hall meeting. He encouraged East Anglian farmers to see the current political landscape as an opportunity rather than a threat, suggesting they would have to find new ways for the public to benefit from their land ownership.
“They are attempting to mitigate uncertainty by listening to new ideas and embracing innovation,” he said.
“The concept of natural capital is a prime example of this and one which farmers and landowners will have to grasp.”
He added: “New development opportunities will no doubt play a part. Whether it’s converting an existing property into a holiday let, exploring the potential for recreational activities or selling parcels of land for new housing – dynamism and diversification will be key to any fruitful enterprise, as will the use of technology and adopting efficient farming systems.”
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