TFA urges tenant farmers to seek rent cuts of up to 20%
Drought-stricken farmland © Graham Hunt/Alamy Stock Photo Tenant farmers are being urged to seek rent cuts of 10-20% this autumn as falling yields, weak returns and persistently high costs leave many farm businesses under severe financial pressure.
George Dunn, chief executive of the Tenant Farmers Association (TFA), said tenants should act before Michaelmas on 29 September, as notices served now could trigger rent reviews and possible reductions from Michaelmas 2027.
“If we can’t get rent reductions in the coming year, when will we ever get rent reductions, given where we are with costs and yields and everything else?” he told Farmers Weekly.
See also: TFA warning to Burnham as security of tenure plummets
The warning comes amid a succession of challenges, including another poor harvest, rising costs, bluetongue disease, drought conditions affecting grazing and forage availability, low milk prices, regulatory pressures and limited access to credit, leaving some tenant farmers struggling to stay afloat.
Highlighting the financial pressures behind the call, an analysis of AHDB figures by the Energy and Climate Unit think tank estimates UK arable farmers will lose £4.8bn after a 14.4m tonne crop production shortfall across three consecutive poor harvests.
The TFA is advising members to contest landlord notices or serve their own formal notices to seek lower rents.
It is also urging major landowners to act now rather than wait for formal review processes, calling for voluntary rent cuts of 10-20%, or rent holidays.
However, landowner organisation the Country Land and Business Association (CLA) said rents should continue to be determined through the established review process, taking account of the individual circumstances of each holding.
CLA president Gavin Lane said: “The rent review process is clearly set out in both AHA [Agricultural Holdings Act] and FBT [farm business tenancies] legislation, and rents payable will depend on the nature, cropping and livestock on each holding, taking into account the terms of any agreement.”
He added: “Rents are reviewed in rotation, and landowners and tenants need to engage in this legitimate process so that a fair rent from the holding can be achieved.”
The Duchy of Cornwall, which covers more than 51,800ha across England and Wales, has about 700 agricultural lettings, including more than 200 tenant farms ranging from small family holdings on the Isles of Scilly to large mixed arable and beef estates.
It said it recognises the “significant challenges” facing farming and has consulted most tenants on the pressures they face.
Rural director Matthew Morris said the scale and severity of the impact varied across the Duchy and its response would be tailored accordingly.
He said the Duchy provided tenants with practical support, including specialist advice, help with grant applications and direct financial assistance, alongside access to specialist mental health support.
“We know that collaboration across the sector will be central to helping farmers navigate the challenges ahead,” he added.
‘Share the burden’
Mr Dunn argued that landlords needed to share the financial burden with tenants as farm businesses faced another difficult year.
“Now is the time when things are going south for the burden to be shared a bit between them and their tenant farmers,” he said.
Mr Dunn advised tenants without a live rent review notice to consider serving one now, allowing a review for a change to take effect in 12 months’ time.
The TFA said seeking a rent reduction was prudent business management and could help maintain viable businesses for both landlords and tenants.
Rent reviews can unlock wider opportunities, says CAAV boss
A rent review should be a practical discussion that opens up broader conversations about repairs, investment or succession planning, potentially delivering value beyond the rent itself, according to Jeremy Moody.
The secretary and adviser to the Central Association of Agricultural Values (CAAV) warns that talks risk going nowhere without reserving the right to formal dispute resolution – arbitration in England and Wales, or the Land Court in Scotland.
That requires serving the right notice more than 12 months before a review date, which must typically be three years or more after the rent last changed.
While England and Wales allow either party to rely on a notice served by the other, Scottish tenants must serve their own.
Mr Moody said discussions should be held in good time ahead of the review date “to allow thought, reduce surprises and consider mutually beneficial outcomes”.
He added: “If a rent review goes to dispute resolution, the decision will focus solely on the rent, taking into account evidence such as comparable rents and the farm’s economic performance under the lease.
“However, both sides should continue working towards an agreed settlement wherever possible.”
