ha farm in the East of England found that the operational costs of growing a hectare of wheat came to £387/ha – more than average and down to much higher estab- lishment and depreciation costs. The farm in question is now looking at only ploughing where necessary for agronomic reasons and reducing the number of trac- tors from three to two – with a hire tractor for use at the peak six-week harvest period, says Mr Gemmill.
Catalyst for change “A review may be the catalyst for people to consider whether a joint venture would be a better way for-
“
Cutting costs and improving effi ciency is a pressing reality
ward or a continued approach to improve cost effi ciencies. We are involved with a wide range of joint ventures from full collaboration to partial and full contract farm- ing agreements. “Equally, it can also highlight
how much of a saving could be made by changing the buying strategy on inputs. For example, looking at the price of three com- monly-used chemicals applied during the 2017 harvest we found
that growers who bought through our best buys service made a 30% saving compared with those pay- ing a serviced price for product. “It is interesting to note that our research suggests that there is no obvious relationship be- tween the size of the farm and its costs. We have also seen that farms with the lowest costs do not necessarily have less horsepow- er available – just cheaper horse- power.
“This might be achieved by op- erating over a large area, but can also be the result of where ma- chines are being kept for longer and residual values kept high through regular maintenance.”
Rural ‘land grab’ won’t solve housing crisis
The compulsory purchase of farm- land at agricultural prices for building will not solve the rural housing crisis, say landowners. MPs on the Housing, Com- munities and Local Government Committee are looking at the ef- fectiveness of land value capture and powers to buy land at agricul- tural prices for housing. The Country Land and Busi-
ness Association submitted writ- ten evidence and gave oral evi- dence to the committee of MPs on 4 June. The impact of restrictive planning and tax systems on the economics of development were holding back investment in the countryside, said the CLA. CLA policy director Christo- pher Price said: “Compulsory pur- chase of land should only ever be a last resort and any changes must acknowledge the economic reali- ties of development in the coun- tryside.”
Straw is helping to bolster arable margins this summer – at a cost for livestock producers “
We are at a moment this country has not had in 70 years
farming businesses adapt and de- liver, Mr Moody explained. “The productivity challenge and the changes needed to meet it will not be adequately answered by efforts over simply the fi rst cou- ple of years.”
The move away from basic payment should be a steady process, so any conse- quential changes in input costs and structures are fully deliv-
ered. “There is no basis for insu- lating smaller claimants, leaving them open to later shock while not encouraging new opportu- nities.”
Any new schemes should be
of suffi cient scale, with legisla- tion in place to allow fl exibility in land occupation and use, to en- able business change, added Mr Moody. At the same time, admin- istration and IT systems must be signifi cantly improved. “As we embark on the design and implementation of post-Brex- it policies, a completely new start needs to be made to ensure com- petent, practical and well-de- signed systems to deliver them. Incompetence in delivery will prejudice the intended goals.”
The CLA argues that current methods of capturing the increase in land values – through section 106 agreements and the CIL go a long way in funding investment in housing infrastructure. It acknowledges that both have
their fl aws but says it does not sup- port any changes that would make the process even more complex and adversarial.
Mr Price said the best way to solve the acute shortage of rural housing was to remove the barri- ers that stand in the way of private landowners who want to help pro- vide small-scale schemes. “These include the uncertain- ties of navigating the cumber- some, chaotic and under-resourced planning system and a tax system that too often disincentivises pos- itive investment. “We are open to a more funda- mental look at new ways of both providing more housing and cap- turing land values, but it must start by working with landown- ers, not seeking to forcibly re- move their assets at artifi cially low prices.”
AUGUST 2018 • ANGLIA FARMER 73
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