Covid 19 – Rural property and business update
The following is a brief round-up of some of the Covid-19 related issues affecting rural property owners and businesses
3 minutes to read
Commodity prices
A bit of a mixed bag for livestock values. Prime beef prices as expected slid somewhat, while lambs prices rebounded after last week’s slump.
In the arable sector, record US harvest predictions pulled back feed wheat values, even though the UK itself is not expected to enjoy a bumper cereal crop this year. Ex-farm prices are around £15/t lower than this time last year.
Poor planting conditions and the impact of Flea Beetle mean the oilseed rape harvest here will be hit especially hard. This is helping to keep prices just slightly higher than 12 months ago, despite the collapse in crude oil markets.
Furloughing extended
Chancellor Rishi Sunak announced on 17 April that the government’s Coronavirus Job Retention Scheme, which allows employees to furlough employees who cannot perform their roles due to the outbreak, has been extended by a month to the end of June.
Fly tipping and sky lanterns
Although the virus outbreak has brought out some of the best of us as a society, it hasn’t increased some people’s appreciation of the countryside. There has been a 300% surge in fly-tipping cases in certain parts of the country, according to The Countryside Alliance.
The closure of official tips and recycling centres has led to more waste being dumped on farmland, which even in a normal year costs landowners around £50m to clear up.
A campaign to launch squadrons of sky lanterns every week to show support for the NHS has, for somewhat obvious reasons, also been given short shrift by the fire brigade and rural organisations. Best to stick to banging those saucepans.
Shooting season hit
According to our team of rural land managers a significant number of estates that host shoots are scaling back or cancelling their seasons. To get a clearer picture of the potential impact on the sector and its workforce we have launched a short survey. Just click on the link below. Everybody who takes it will go into a draw to win a decent magnum of Champagne. https://www.surveymonkey.co.uk/r/2020_shooting_season_sentiment_survey
Labour shortfall
Despite a valiant response by the British public to create a new land army to help harvest fruit and vegetable crops usually picked by seasonal workers from the EU, there is still a significant shortfall. Around 30,000 people have signed up to work on farms, but 80,000 are needed in total.
Some horticultural growers are resorting to chartering planes to bring in workers from Europe and even as far away as Nepal, according to press reports.
Welsh agri-pollution delay
The Welsh farming minister has delayed her decision on whether to implement the Draft Water Resources (Control of Agricultural Pollution) (Wales) Regulations 2020 until after the Covid-19 pandemic has receded.
https://gov.wales/draft-water-resources-control-agricultural-pollution-wales-regulations-2020?_ga=2.228534110.216000819.1586351942-2111641444.1548417540
The draft regulations look to cut the amount of pollution created by agriculture and focus particularly on slurry management and fertiliser applications. “A lot of them would be considered good practice anyway,” points out my land management colleague Edward Holloway.
Land market stagnates
As the countryside greens up the spring selling season should be gaining momentum, but last week fewer than 200 acres of farmland were advertised in Farmers Weekly. Annually, volumes are down by almost 40%. With the current round of movement restrictions extended for another three weeks this trend is set to continue.
New Capital Gains Tax deadline in place
Given the above, the following may not be applicable to many, but it’s worth bearing in mind for when the market eventually gets going. As of 6 April, individuals and trustees have just 30 days to pay the CGT bill on the sale of properties that don’t qualify for main residence relief.
However, HMRC has acknowledged that the new deadline has not been especially well publicised and says it will not apply late-filing penalties for transactions concluded between 6 April and 30 June and reported up to 31 July. Interest on the payments will still accrue, though.
In addition, HMRC has indicated it will take a flexible approach where payment is difficult due to the COVID-19 crisis.