Falling crop prices won’t put farmers off
NewsThursday 31 July 2014
A recent survey has found that, even with the falling crop prices, the majority of farmers are remaining optimistic about future growth.
MHA, a UK-wide group of accountancy and business advisory firms, carried out the survey, which is the second in a series of agricultural surveys that have been conducted this year.
It found that 69% of farmers were expecting to see growth in their business, and 51% were planning to increase their acreage.
The MHA Agricultural Insight Survey was first conducted at the Lincolnshire Agricultural Machinery Manufacturers Association (LAMMA) in January and re-run at Cereals 2014.
These surveys took in the views of more than 200 farmers nationwide.
The study did find that succession planning was a concern for many farmers and it is moving up the agenda for many of the respondents.
European Union predictions earlier this month claimed that the European cereal harvest is set to beat the average for the second year in a row, and that this could be part of the reason for the optimism amongst those surveyed, outweighing the impact of recent drops in commodity prices.
The farmers did, however, complain of a shortage of available land in which to expand their business stating that they were feeling the squeeze on their margins.
The head of the MHA Agriculture Group, David Missen, has said that the optimism being shown in the survey is slightly at odds with the recent falls in cereals prices.
Speaking to East Anglian Daily Times, he said: “The key figure for farmers is price x yield and we would hope the yield for the 2014 harvest will be exceptionally good.
“Although the recent falls in the price of both cereals and meat was a key topic of conversation, it is encouraging that there is an underlying optimism as we go into harvest. For those looking for expansion however, the availability of the right land at the right price remains a barrier to expansion as land prices continue to rise while supply remains static.”
Apart from the concern about the amount of land available, another worry for many farmers is the planning for the future of the business. Out of all the farmers surveyed at Cereals, 17% felt that succession planning was a “great concern” and an additional 39% acknowledged that this was of “some concern”.
Adam Rowden is a writer for Farming Ads view his Google+ page.