The view from a New Entrant Tenant Farmer STEVEN POWLEY

Transcription

1 The view from a New Entrant Tenant Farmer STEVEN POWLEY

2 Introduction In November 2013 we took on a ten year Farm Business Tenancy at a 267 acre farm in the Eden Valley

3 Background the long road to a tenancy I grew up at Green Marsh, a ten acre small holding, where we kept beef and sheep It was always my intention to become a livestock farmer I studied agriculture at Newcastle University After graduation I began working on a mixed farm of which free range egg production was a major component Began looking at options for the future: Make Green Marsh a viable business Rent a farm Expand herd of suckler cows

4 Green Marsh

5 Challenges planning granted for free range egg enterprise Fell through at final stages due to market conditions Land at a premium in Cumbria In competition with dairy farmers Expanded herd of suckler cows Invested wages from work Took on seasonal grass lets Away wintering

6 FBDC 2008, 2009, 2010 competed in the National Federation of Young Farmers Farm Business Development competition Competitors were given a model farm and budget, and were asked to put together a tender and business plan 2009 placed 2 nd, 2010 won This was a very helpful experience which taught me: Tenacity and to never give up To carefully analyse your business plans The importance of not tendering a high rent in hope of getting the farm, only to be saddled with unsustainable rent levels

7 Herd expansion Land was the limiting factor Part time farming Cattle kept at numerous locations Small herd quality over quantity Strive to gain a good reputation for the stock we sell Wet summer of 2012 horrendous field conditions Reached a point where expansion was no longer possible above 50 cows

8 Low Northsceugh 267 acre 60 acre SDA 150 acre ploughable land Remaining is permanent pasture Rises to 750ft above sea level Owned by a retired farmer First tenant ran the farm as a dairy enterprise Landlord felt that he no longer wanted the farm to be ran as a dairy enterprise and that he would like to help young people get a start We had been using the same land agent who suggested us as possible tenants

9 The farm business Initially we are informally restricted as to how to run the farm as it was rented to us on the basis that it s a traditional upland farm - beef and sheep Due to the high cost of investment we haven t been able to fully stock the farm so have taken in other farmer s livestock

10 Expanded the herd to 120 cows and are still in the progress of expanding

11 Small flock of sheep ewes

12 Take on cattle to winter

13 Take on sheep to winter

14 Grown 45 acres of spring barley. This reduces feed and bedding costs and rotation helps with reseeding, as many fields are badly infested with weeds.

15 Challenges Buildings only one functional building the day we arrived Previous tenant took most of the gates and troughs which was unexpected Infrastructure had been left in a poor state Fences Drains Weeds infestation Rodent infestation Insufficient shed lighting Rapid expansion of the herd has lead to some health issues. So vet and med costs have been higher than budgeted as has calf mortality levels

16 Investment Focused capital on: Ingoings Stocking the farm Making it efficient to run with low labour requirement (safety) Allot of work on improving the holding, with the intention of impressing the landlord 20 water troughs replaced Gates Feed barriers and troughs Lighting Cattle handling equipment Concreting shed bottoms and yards

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18 Huge reliance on contractors to do tractor work, avoid cost of buying machinery

19 Labour arrangement At the beginning of the tenancy my father, brother and myself were in full time employment. It was decided that my brother would give up his job to work on the farm full time and I would continue with my job as a unit manger of a free range poultry site This allows for faster herd expansion

20 Business viability Doesn t really need to be said particularly this year with the state of the agricultural commodities market on a global level that future planning is extremely difficult Farm gate prices can fluctuate wildly Most of our produce is sold through the market All we can do is farm as efficiently as possible Try to produce a product that is in demand

21 We have tried to carve out a niche market selling calves for people to show at the Winter Fairs Harnessed social media

22 Tenant Landlord relationship I believe it should be a partnership The tenant is the custodian of a valuable asset In my personal situation I feel very fortunate as the landlord is a retired farmer with a wealth of experience of the farm He has been very understanding of the situation we are in and very supportive

23 Length of tenancy I certainly agree with the view that FBT s should be 10 years plus Benefits for tenant and landlord The tenant has security to invest in the farm Reseeding Soil fertility Drainage Building improvements All help to maintain or improve the value of the Landlord s asset At the same time improving the efficiency of which the tenants business is ran Shorter tenancy length can lead to mining of farms where minimal management is put back into the land

24 Summary Tenancy opportunities are rare, especially for new entrants 5 years before farm is fully operational Landlord and tenant relationship is vital Longer tenancies create favourable environment for investment