Exodus is expected
ONE-FIFTH of the people now farming could leave the industry within five years, according to ADASs head of management consultancy Bill Hall.
Recent changes in tenancy law would quicken structural change, which was already being pushed by currency movements, the euros arrival, plus CAP and WTO reform, he said at the launch of the firms Agricultural Strategy 1998 paper.
For those wanting to leave the business, it was no longer just a choice of selling the farm or putting it on an full tenancy. Now, farm business tenancies increased the options, said Mr Hall.
More multi-functional businesses would develop. For example, a farmer might continue to live on his farm, and receive £250/ha (£100/acre) rent for arable land from one or more tenants, while drawing income from another source.
Structural change had long been evident in the milk sector, with the number of herds with fewer than 50 cows falling nearly 40% in the 10 years to 1996. "But dairy farmers dont have a uniqueness as smaller, older farmers," said Mr Hall.
Rapid change would also occur in the arable sector as the less competitive businesses disappeared. For some, expansion was not an option. "The escape route requires more land."
Buying land is one area where farmers have sometimes over-stretched themselves, said Mr Hall. "Investment should generate profit improvement – not just a bigger business."
Dairy herds in the UK
Herd size 1996 % change
000s from 1986
Under 50 16.2 -39
50-100 13.5 -23
100-200 7.0 -5
Over 200 1.0 -9
Cereal holdings in the UK
Cereal area 1996 % change
000s from 1986
Under 50ha 51.9 -24
50-100ha 12.0 -10
Over 100ha 8.9 -18