English lowland entitlements trading for less than in 2016

English non-SDA Basic Payment Scheme entitlements are currently trading at £170-£190 each, according to brokers.

Chartered surveyors Townsends said the number of entitlements it had traded so far this year was nearly a third down on last year, with Brexit casting a gloom over the market and pushing values below 2016 levels.

Prices had dipped down to £170 in February, although offers had rallied slightly with the opening of the Rural Payment Agency’s entitlement transfer system, it said.

See also: Farmer wins High Court battle over entitlements

However, it pointed out that at current prices (and exchange rates) farmers who purchased entitlements could be looking at a 14% return within eight months, with the 2018 BPS claim year offering a 100% return.

SDA entitlements were currently trading at around £200, although some vendors were confident the market will rise to £220 and were holding out for a higher prices, it added.

Moorland entitlements were in very short supply and selling for £50-£60 per entitlement.

George Paton of Webb Paton said trade in lowland entitlements was starting to increase as more farmers and agents got stuck into their 2017 BPS forms.

“Trade is currently around the £170-£180/acre mark with the bigger blocks going for a bit less than the smaller blocks,” he said.

Prices ramp up

“But I expect things to ramp up over the next few weeks and prices could rise to £200 per entitlement. This time last year we were trading at £250-£275.”

Mr Paton added that farmers who needed entitlements might be wise to buy them sooner rather than later as it would give the RPA more time to process the transfer.

Carys Studley, rural surveyor with Rostons, said there was currently a surplus of non-SDA entitlements on the market, which was why prices had eased to the £170-£190 level.

Usage rules meant that farmers had to use all their entitlements at least once in every two years or they would lose some in the second year.

This meant that some vendors were offering up their excess entitlements and were prepared to take slightly lower offers on them, she said.