Farming without subsidies

Clive

Staff Member
Arable Farmer
Location
Lichfield
What do you do about high hill land . It's not viable without sub , farmers would have to pack up and leave as the only option would be to plant it with trees

I think we have to accept that food production is not always the best use for some land - this has always been the case

If land can’t produce profitable food without subs it’s time to consider other ways to make a living from it and that’s probabaly where the public goods / natural capital comes in as the kind of land you describe is potentialy very rich in that

We don’t have some god given, publicly funded right to farm and it’s conceited to think we have
 

Clive

Staff Member
Arable Farmer
Location
Lichfield
I really like the positivity from Sir Lockwood Smith on our potential future. It will be a industry bloodbath to achieve it though.

Wasn’t a bloodbath in NZ when it did - less than 1 % went out of business and under 5% left through natural wastage over the following few years

That’s a very healthy % - no industry should be stagnant and have no new blood or turn over of business - Sir Lockwood Smith said all this

I bet we loose more than that % of Farm business each year in the uk now despite subs !
 

rob1

Member
Location
wiltshire
I really like the positivity from Sir Lockwood Smith on our potential future. It will be a industry bloodbath to achieve it though.
to be fair thats what was said about new zealand and while some did lose everything life carried on, we have a lot more consumers than they have so we can survive, at least we have had enough warning to get our house in order, rents and land price will fall which wiill allow new vibrant entrants with new ideas to come in, of course we will need to work together to get more of the retail price and thats where it will fall down if we arent careful
 

spin cycle

Member
Location
north norfolk
Wasn’t a bloodbath in NZ when it did - less than 1 % went out of business and under 5% left through natural wastage over the following few years

That’s a very healthy % - no industry should be stagnant and have no new blood or turn over of business - Sir Lockwood Smith said all this

I bet we loose more than that % of Farm business each year in the uk now despite subs !

don't use nz as a 'beacon of hope' for farming without subs....its a myth
 

spin cycle

Member
Location
north norfolk
in a lot of cases only because they've taken on a lot of debt...i googled it all a while back.....in short their debt is 20 times their annual output....ours is six

sometimes they've got 100 yr mortages

after the last dairy downturn nz banks want farmers to pay debt back and build up cash buffers for the next downturn

ever since subs went there have periodic attempts to bring in a 'farm debt mediation bill' to protect farmers from the banks.....it finally seems it's going to happen

they've also had lower environmental regulation which is about to change...this is going to need investment but are the banks going to lend more given the already indebtness and 'mediation bill'

in short kiwi farmers have 'played the game of their lives' in terms of efficiency but will/has it been enough?

this nz farming is rosy myth needs debunking

they've basically replaced their subsidy by being a third more effecient,a third in debt and a third in lower regulation IMO
 
ive made my opinion clear im happy to farm sub free if the rest of the world looses the 497bn it gives to farmers each year, if theyre going to continue to keep supporting them and keeping world prices low we need to support our own

Oh ffs. Do you want a payment because parts of Africa enjoy crazy heat units and can grow two crops a year?

Life is not fair and world agriculture is not and never will be fair. Some people have lower costs than you. Some enjoy less regulation. Some are much farther from their consumers than you are, some do not get the rainfall you do. There is no level playing field and there never was. Give up your funny money and stop complaining.
 
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What do you do about high hill land . It's not viable without sub , farmers would have to pack up and leave as the only option would be to plant it with trees

If it ain't viable, it ain't viable, leave the bloody stuff alone. Would you try to farm a swamp or arctic tundra?

Some places just can't turn a shilling, put it on the shelf along with many many thousands of square kilometres of similar on planet Earth where farming as we know it today just won't work.

If the Australian government gave billions to farmers in their own country encouraging them to try and grow sugar beet in the absolutely driest territories, and then subsidised the freight of their output to the nearest port, hundreds of miles away and none of it ever pencilled, would you reckon it was madness?
 

Still Farming

Member
Mixed Farmer
Location
South Wales UK
That’s the land owners problem not mine !

Rents around here are simply inflated by the value of sub, so without it they will all adjust to the bare land rental value which is perfectly affordable whilst still being nicely profitable

Most farms have fixed cost structures that are frankly ridiculous vs where they could / should be - they may be good farmers but seriously lacking in the ability to run a business

It will put somef farns out of business - this is not a bad thing .............
Yes maybe.
The Landowner just gets someone else in to pay rent .
If people got to earn x amount to pay rent wether through growing crops etc or from subs. handouts,its got to come from somewhere and its therefore impact.
 
Yes maybe.
The Landowner just gets someone else in to pay rent .
If people got to earn x amount to pay rent wether through growing crops etc or from subs. handouts,its got to come from somewhere and its therefore impact.

The point Clive is making is that rents will have to sit at a level that is sustainable for the tenant, or they won't take on the rent in the first place, why would they? The rental market for land will thus be entirely determined by what the earning potential of that land, or what the range of prospective tenants believe it is, not distorting it with EU funny money and all that entails. A simple sales-costs= profit calculation that a lot of people are capable of doing although some still seem to struggle with calculators I admit.

In areas where there is high demand for rented land, the rents will remain high. In areas where no one wants it or if the land is problematic and won't grow wheat well, rents will drop. In reality it t'was ever thus, only the curtain of funny money obscures this.
 

stewart

Member
Horticulture
Location
Bay of Plenty NZ
they've basically replaced their subsidy by being a third more effecient,a third in debt and a third in lower regulation IMO
Not quite accurate, efficiency has increased by more than a third, debt has increased by more than a third, regulations are exceptionally high, as an exporter to various countries around the world they have to be.
 

Still Farming

Member
Mixed Farmer
Location
South Wales UK
The point Clive is making is that rents will have to sit at a level that is sustainable for the tenant, or they won't take on the rent in the first place, why would they? The rental market for land will thus be entirely determined by what the earning potential of that land, or what the range of prospective tenants believe it is, not distorting it with EU funny money and all that entails. A simple sales-costs= profit calculation that a lot of people are capable of doing although some still seem to struggle with calculators I admit.

In areas where there is high demand for rented land, the rents will remain high. In areas where no one wants it or if the land is problematic and won't grow wheat well, rents will drop. In reality it t'was ever thus, only the curtain of funny money obscures this.
You can look at it all ways.
The Landowner will want to "maximise "their assets respectful of "sustainable level" or not.
"The Landowners problem not mine", attitude won't fit we may find!
 

Top Tip.

Member
Location
highland
Wasn’t a bloodbath in NZ when it did - less than 1 % went out of business and under 5% left through natural wastage over the following few years

That’s a very healthy % - no industry should be stagnant and have no new blood or turn over of business - Sir Lockwood Smith said all this

I bet we loose more than that % of Farm business each year in the uk now despite subs !
What happened in New Zealand when subsidies were removed was that 10% of farmers went out of business but 90% of their suppliers went bust. The farming industry over there went through a very tough time for a lot of years ,why you would wish this on yourself and your fellow farmers is beyond me.
 
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