English lowland Basic Payment Scheme (BPS) entitlements have started trading at about £150/ha this year.
The number of deals that have taken place to date is very limited, but there is an expectation that prices could firm when the trading period gets busier after Christmas.
Hugh Townsend of Exeter-based letting agent Townsends said he struck his first deals of the 2018 year in mid-September, with non-severely disadvantaged area (non-SDA) entitlements selling for £150/ha plus VAT.
This is slightly higher than the average price in 2017, which was £144/ha, although across the whole of last year’s trading period prices ranged from a low of £100/ha to a high of £180/ha.
The bulk of trading typically happens in the final few weeks before the submission of the BPS form.
Mr Townsend said entitlement values had dropped in 2017 as a reaction to the Brexit vote.
However, his view was that there could be greater confidence this season following prime minister Theresa May’s Florence speech, which suggested a two-year transitional period beyond March 2019. This signalled support payments might continue in their current form for a while longer, he said.
“Although nothing is guaranteed, it is looking like support payments will be there for another three years,” he said.
Tony Rimmer of Cheshire-based Rostons said he expected trade to pick up once 2017 BPS payments started to arrive in farmers’ bank accounts.
People were buying on the basis that the entitlements would unlock support payments for 2018 and 2019. “Beyond that, anything is possible,” he said.