18 October 2018

Chairmans report

2017 saw Rural Plc (Kent) continuing in its work to provide analysis and commentary on the state of the rural economy in Kent. Inevitably this effort included close attention to the implications of the Brexit vote and in April we joined forces with Canterbury Christ Church University in putting on a sector presentation with keynote address from Richard Ashworth MEP. That joint initiative has continued.

We also launched the Rural Rap sponsored by the BTF Partnership, which provides a weekly snapshot of contemporary news and views particularly emphasising where and how Kent may be affected. Despite GDPR this initiative has been widely acclaimed and is eagerly awaited every Friday morning by several hundred stakeholders around the county.

We also continue our annual analysis of the financial performance of the county’s agricultural and horticultural sectors and more detail on that will be found later in this report. Very noteworthy however is the fact that in the “good” years of 2012 and 2013 we saw total profitability coming in at well over twice the level of BPS and Agri Environment payments. In 2014/15/16 total gross margins were poor and the overall profitability of the sector barely equated to the gross value of support payments. It would be oversimplifying to suggest that no farm would have made a profit without BPS and Agri Environment, but that would have certainly been the case in many businesses.

2017 has seen profitability in the sector exceed the level of support payments once again but that margin is slender and most of the surpluses came through from the top and fruit sectors which benefited from the affect of catastrophic late frosts in mainland Europe.

Despite a better year in 2017, the horticultural sector still faces uncertainty over labour availability post Brexit and the industry overall is totally compromised by wider uncertainty over trading and income support going forward.

It seems inevitable that farmers will be expected to do more with less money and all against a background of increasingly stringent regulation on food safety, welfare and the environment.

Coherent policy is vital to balance the needs of family farming structures, so important to the rural community, alongside the efficiencies required at the corporate end of the industry.

Simply capping levels of available subsidy would be naive in the extreme. Farming as a business must have reasonable prospects of profitability if it is to deliver the environment that our general public values so highly. The environment comes with biodiversity, and that cannot be delivered without connectivity. The world of conservation hankers after a living landscape and it is only farming and forestry which can deliver that.

Such an ambition is a non-starter without profits across the sector.

Mike Bax, Chairman

 

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