Calculating whether you can manage without

Tim W

Member
Livestock Farmer
Location
Wiltshire
As a grazier, I assume you will not be having the infrastructure and land management costs that a lot of farms, rented or owned, have to find each year. Those costs of property ownership/management are quite considerable. I could make a small profit without sub, if I didn't have a lot of those costs, or very cheap land rental so that I could use acres rather than fertiliser, lime, etc.
No, but much larger fuel/haulage bills I would imagine?
 

The Son

Member
Location
Herefordshire
Thats the best reply so far...
Joe Public are gonna be in for a much bigger shock id say..
when bread is £2 a loaf or £3 even & everything else likewise up say what 40% ??? wild guessing.
Tech my LL will have to reduce the RENT buy the amount the BPS was previously set at if my 1986 tenancy Agreement rules
are followed by the book.
We all wont need as much working capital neither.
I'll bet alot of the rest of the variable inputs will fall.
Maybes iam wide of the mark but is it such a bad thing? :(

.....The transitional period will be rough thats the only snag......

I disagree, the public are used to cheap food, the supermarkets are used to supplying them with cheap food, and government delights in supplying their voters with cheap food.

The world is a small place and if we can't supply it at the required price, their are plenty of others who will.

I do not believe the market will make up the shortfall in SFP.
 

Extreme Optimist

Member
Livestock Farmer
I think one of the problems is actually calling these payments "subsidies". Are they really subsidies? They were at one point with Arable Area Payment Scheme and the cattle and Ewe premium schemes, but are they actually subsidies now? We are selling RPA/DEFRA/NE a service. They want greening etc. They want the footpaths managed to within certain criteria, they want muck spread only within certain months, they want the hedges cut when they want them cut. Additionally, they want fields not to be poached and they want feeders to be moved daily. They are NOT subsidising our production, they are paying us for a service. It is OUR land and OUR businesses and we have a right to take the payment and agree to cross compliance or tell them to keep their money and bugger off. We have allowed ourselves to get in a situation where they dictate what they want to happen on our land and our businesses whereas if we were selling a service to anyone else, we would be dictating the terms.
The indirect, result of the payments maybe that we can accept prices that are lower than the cost of production for our produce, but we are not being subsidised to supply cheap food. The payments are in place so that they can control what we do. They like this control and won't want to relinquish it. Yes, they can impose rules anyway and take us to court, but that is not nearly as easy for them as withholding 3% of our BPS/HLS/ELS etc.
 

J 1177

Member
Mixed Farmer
Location
Durham, UK
I think one of the problems is actually calling these payments "subsidies". Are they really subsidies? They were at one point with Arable Area Payment Scheme and the cattle and Ewe premium schemes, but are they actually subsidies now? We are selling RPA/DEFRA/NE a service. They want greening etc. They want the footpaths managed to within certain criteria, they want muck spread only within certain months, they want the hedges cut when they want them cut. Additionally, they want fields not to be poached and they want feeders to be moved daily. They are NOT subsidising our production, they are paying us for a service. It is OUR land and OUR businesses and we have a right to take the payment and agree to cross compliance or tell them to keep their money and bugger off. We have allowed ourselves to get in a situation where they dictate what they want to happen on our land and our businesses whereas if we were selling a service to anyone else, we would be dictating the terms.
The indirect, result of the payments maybe that we can accept prices that are lower than the cost of production for our produce, but we are not being subsidised to supply cheap food. The payments are in place so that they can control what we do. They like this control and won't want to relinquish it. Yes, they can impose rules anyway and take us to court, but that is not nearly as easy for them as withholding 3% of our BPS/HLS/ELS etc.
Thats why i genuinely think there will be some sort of sub because defra will not want to relinquish controll. Also if farmers arent following rules its a lot easier to use the threat of bps reduction to penalise rather than bringing leagal proceedings.
 

nelly55

Member
Location
Yorkshire
What makes me cross with certain comments.No two farms are the same.Some have to borrow to either buy land,survive until a better year ,buy a family member out.Yet we get if you can't make it pay get out of farming.Well if daddy left you a great farm,no borrowed money or you are Mr Perfect I make money because I farm so perfectly here's my figures well As a member of the public reading all these perfect farmers why am I giving them subsidies,so all us useless non profit farmers go and you are left with a no subsidy world.So in a perfect world all we are left with is perfect profit making farms,getting no subsidies and trading on the open market.Good luck ,I could make up my small amount of subsidy by a part time job but it's going to be one hell of a job to get a salary of £50000 plus unless you become an Mp.Its sad because all the public see is flash 4x4s and big houses ,family farms are going yet these were the backbone of the village for work,trades and tradition.Sorry bad morning and my lunch time rant.Plus the public are getting subsidised food one by the buyer hammering us down on price and the retailer putting prices up.The world is in a mess because of governments run by people who have little or no idea of the world outside their bubble
 
What makes me cross with certain comments.No two farms are the same.Some have to borrow to either buy land,survive until a better year ,buy a family member out.Yet we get if you can't make it pay get out of farming.Well if daddy left you a great farm,no borrowed money or you are Mr Perfect I make money because I farm so perfectly here's my figures well As a member of the public reading all these perfect farmers why am I giving them subsidies,so all us useless non profit farmers go and you are left with a no subsidy world.So in a perfect world all we are left with is perfect profit making farms,getting no subsidies and trading on the open market.Good luck ,I could make up my small amount of subsidy by a part time job but it's going to be one hell of a job to get a salary of £50000 plus unless you become an Mp.Its sad because all the public see is flash 4x4s and big houses ,family farms are going yet these were the backbone of the village for work,trades and tradition.Sorry bad morning and my lunch time rant.Plus the public are getting subsidised food one by the buyer hammering us down on price and the retailer putting prices up.The world is in a mess because of governments run by people who have little or no idea of the world outside their bubble

Why should the public pay subsidies so a farmer can buy a family member out?
 

nelly55

Member
Location
Yorkshire
Why should the public pay subsidies so a farmer can buy a family member out?
I am not saying subs should be used for buying family members out ,I may have worded my comment incorrectly I was just stating there are many reasons why a farm doesn't make a profit in a farming year.Subsidies are a hot topic just as benefits are ,or subsidies for wind power etc.just a bit off topic but if subsidy in a form for wind power or similar ,is that not a sub to build a profit making income,just like land.
 
I am not saying subs should be used for buying family members out ,I may have worded my comment incorrectly I was just stating there are many reasons why a farm doesn't make a profit in a farming year.Subsidies are a hot topic just as benefits are ,or subsidies for wind power etc.just a bit off topic but if subsidy in a form for wind power or similar ,is that not a sub to build a profit making income,just like land.

I personally think subsidies of all kinds should go in every industry.
 

DrWazzock

Member
Arable Farmer
Location
Lincolnshire
Easy just to subtract it from the year's profit and see what's left. We'll just manage without it but won't be spending much on investment. We've got the place to where we want it now anyway, using SFP money for sheds and infrastructure etc over the years.

I'm ahead of the game anyway as they've slashed mine this year for some unknown reason. Good job I'm not relying on it. They needn't think they'll get any cooperation from me in the future though.
 
So you think the likes of nissan that were given massive ammounts of sub in the form of grants to keep jobs in the north east, and in this country shouldnt have been given?

No, if it isn't economically viable then it is not economically viable. Different if it was a one off due to the recession but if they are continually getting them like farmers do then it clearly shouldn't be there!
 

J 1177

Member
Mixed Farmer
Location
Durham, UK
No, if it isn't economically viable then it is not economically viable. Different if it was a one off due to the recession but if they are continually getting them like farmers do then it clearly shouldn't be there!
But many industries are getting subs because the reality is most of these multi nationals would clear off abroad into lower cost economies. And there are plenty of sweetners by governments for big business. What you have to realise is the sub paid to farmers 99 times out of 100 ends up in the local rural economies. The first to suffer when subs go wont be the farmers it will be the associated industries, their employees and their familys.
 

joe soapy

Member
Location
devon
The whole country is in need of a reality check.
Everything the ordinary man at the foot of the ladder has to pay for with his taxes both direct and indirect has spiraled out of control, been having dealings with the cops recently, All i hear is they have had big cuts, Well our parish used to fund a resident policeman complete with house and integral station, not quite like that now, i telling them a few of those smart detectives should be investigating who is stealing their cash.
School class for me was 1 teacher to 36 pupils, lady up the road works as classroom assistant, 1 of 4 in the class of 20 plus a teacher.
We had a resident doctor and district nurse, the doc also did private work for the posh people,
now we got umpteen in the office, various specist nurses and a few docs. growing up, home visit
were normal if needed, otherwise go to surgery and to be seen usually in the hour, now it could be 2 weeks for an appointment if you can get through on the phone
 

JJT

Member
BASE UK Member
Location
Cumbria
If you take out depreciation as well as bps in the accounts then we would show a profit. Obviously that is not sustainable but we have kept everything fairly well up to date and improved infrastructure, so could weather the storm for a few years.
 

DRC

Member
I personally think subsidies of all kinds should go in every industry.
Subs are a very small price to pay for a safe, consistent, affordable supply of good quality food in this country.
They also help keep the landscape in areas such as the lake District, looking just how the tourist industry wants it too.
Food is too important to leave to pure market forces, as we all know what leaches in the city or banking world, would do for a fast buck.
 

Billboy1

Member
Surely if subs disappear land prices and rental values will fall as part of the natural market readjustment? It could possibly be argued that subsidies are part of the reason land prices got so high?

Definitely has a influence on aha and fbt rents if it goes these will have to fall assuming crop prices don't rise dramatically
 

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