UK farming must reconfigure & attract investors to grasp future opportunities

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A mindset that is relatively closed to new business structures, limited collaboration and a lack of investment into farm infrastructure are hampering UK farming's potential according to research commissioned by Oxford Farming Conference (OFC). Delegates will hear these challenging findings at the organisation's 2014 conference, held at Oxford University from 6-8 January.

The report states that there are many strengths to farm structure in the UK, but says that the industry must be more open to changes in land management and not be wedded to owning land to farm it. It also challenges farm business operators to think more widely about sources of capital and to explore agreements like share farming or partnering external investors.

"The context to this important research is that our farming sector has far-reaching opportunities, but it needs to adapt to profit from them," said Julian Gairdner, OFC 2014 Co-Chairman. "Underwriting the whole report is the recommendation that farm businesses need to adopt an openness and willingness to embrace change." "It is likely that more transformation will happen in the UK farming industry in the next 10 years than we have seen in the past 50, so the industry needs to be prepared to adopt new systems, structures and partner investors who understand agriculture. The report delivers some hard-hitting punches and - intentionally - it doesn't hold back in spelling out the progress needed." Mr Gairdner suggests that the report, produced by Bidwells, draws reasoned conclusions about what needs to happen to accommodate the expected and unexpected on agriculture's horizon.

The report's author, Ian Ashbridge from Bidwells, says that farmers will need to seek alternatives to the tried and tested, and warns that further decoupling of farm ownership from farm operation was inevitable. "We are seeing investors from outside farming bringing in new sources of capital and creating opportunities for the most professional, well-equipped and entrepreneurial farmers as operators. These professional operators will challenge the accepted definition of “farmer” as the industry and, to a degree, society understands it," he highlights.

"Farming has so few operational structures for the combination of land, labour, capital and enterprise. One of the things this research has identified is that there is a need for new and innovative structures – models which align interests more effectively, particularly in light of some of the major changes in farming likely to be seen in the next decade." "For example, share farming, so successful in New Zealand and other countries, remains relatively untried here. Its adoption requires a major change in attitude from farming towards risk and reward, and sharing the whole value the business generates – even equity," he suggests. He predicts that the future profitability of farming will necessitate inter-farm collaboration on infrastructure such as buildings, roads and water systems, in order that sufficient capacity can be achieved.

"Water security will be the key defining issue for food production in a decade's time - farmers need to prepare for this." He warns that farming must also be allowed to access new technologies that will improve yields of key food crops and not fall victim to the same "Luddite attitudes as GM has." Farming must also invest in its people – in the widest sense.

"The UK risks exporting its talent both in the science community, but also in agricultural leadership and business management. These assets must be retained, and invested in, if a sustainably competitive future is to be reality." The basis of the report's conclusions was a series of in-depth interviews with over 100 farmers, 50 agri-industry experts and a peer review by a 10-strong expert panel. The report has been generously supported by Burges Salmon, Syngenta and Volac.