The Rural Update: Reinventing farming
Your weekly dose of news, views and insight from Knight Frank on the world of farming, food and landownership
7 minutes to read
Viewpoint
I hope that you had a good Easter. It's traditionally a period of rebirth, and policymakers certainly seem keen for the UK's agricultural sector to reinvent itself, whether that's via new income streams from nature markets, or utilising new technology to boost efficiency and productivity.
It's undeniable that farming is on the cusp of a new era where those factors are set to play a significant role. At its heart, though, our industry is fundamentally about using the soil to feed people.
How to do that profitably and sustainably will be different for every farm or rural estate, but it's unlikely that business as usual will be an option, even if the government’s prescription doesn’t suit everybody.
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Commodity markets
Oilseed rape perplexes
Despite expectations that Donald Trump’s trade tariffs would dampen sentiment, oilseed rape prices are heading in the opposite direction. “Rapeseed and wider oilseeds markets continue to perplex traders, processors, and the rest of the trade, as values have continued to improve amid global tariffs, which initially looked set to stage a decline in prices,” reports Frontier.
“Old crop May 2025 MATIF futures have risen dramatically versus new crop futures and are currently trading at a €70/t premium to August 2025. Towards the expiry month of the futures contract, there is often ‘technical’ trading where the futures become detached from the reality of the cash oilseed market. This year, these movements are particularly early and reflect the extremely complicated market we find ourselves in,” it adds.
Nitrogen in short supply
Fertiliser prices are climbing, and delivery times are lengthening as farmer demand picks up. Imported ammonium nitrate is now costing £377/t, according to the AHDB, up from £337/t this time last year.
A lack of farmer confidence at the end of last year delayed orders, while the early closure of the Sustainable Farming Incentive (SFI) scheme means more land is being drilled with spring crops rather than wildflower mixes.
The headline
Carbon credit trade boost
The government says the UK will cement its status as the "green finance capital of the world" following the launch last week of a new consultation aimed at raising the integrity of voluntary carbon and environmental markets.
Its proposals, which it says will make it easier for businesses to create and trade carbon and nature credits, as well as attract more private finance by building trust in nature markets, are based on the following six principles:
- Suppliers should ensure that credits meet recognised high-integrity criteria that ensure they deliver environmental benefits
- Buyers should measure and disclose the planned use of credits as part of sustainability reporting
- Users should consider how credits feed into wider transition plans that align with the 1.5°C goal of the Paris Agreement
- Claims involving the use of credits should accurately communicate an organisation or product's overall environmental impact, including by using appropriate and accurate terminology
- Market participants should cooperate with others to support the growth of high-integrity markets
- Credits should only be used in addition to ambitious climate action within value chains
The consultation closes on 10th July.
News in brief
Defra tech funding
A new round of funding to promote the use of technology on farms has just been announced by the government.
The £47 million pot, which has been split across three funds, will “help bring cutting-edge technologies into real-world use with a particular focus on reducing on-farm emissions and capitalising on new opportunities made possible by the Precision Breeding Act,” says Defra.
Zombie solar schemes hit
The energy regulator Ofgem has just published the details of its Connections Reform Package, which it says will prioritise renewable energy schemes that are ready to begin operating and align with the government’s clean-energy targets. Many have been held up because of queue-blocking by so-called “zombie” schemes. The first projects could be live by 2026, claims Ofgem.
Banks shift climate target
In further signs of a more nuanced attitude to climate-change, the 129 members of the Net-Zero Banking Alliance (NZBA) have voted to drop the requirement for banks to set climate targets aligned with limiting global warming to 1.5°C degrees and reaching net-zero emissions by 2050.
Six major US banks have already quit the NZBA following pressure from Republican politicians. Conversely, Triodos Bank, which finances many environmental initiatives, has left the alliance in protest at the watering down of its aspirations.
KF expert judges eco award
James Shepherd has been asked to join the judging panel for the Royal Agricultural Society of England's prestigious annual awards.
James will help judge the Natural Capital category, sponsored by Trinity Natural Capital, which celebrates farmers who are leading the way in sustainable agricultural practices and demonstrating how agriculture and the environment can thrive together.
Find out more about the award, enter or nominate somebody.
F&M bioterrorism?
The Hungarian and Slovakian governments, which are battling to contain an outbreak of foot and mouth (F&M), have suggested that the emergence of the disease in their countries could be down to “bioterrorism”, reports the Politico website.
Neither, however, have provided any evidence to back up their claims. Meanwhile, in the UK, Defra has published its risk assessment of the likelihood of F&M reaching the UK. As of 3rd April, it classed the risk as “medium”.
Property of the week
Private Essex Island
This week's property is something slightly out of the ordinary. Osea Island, near Maldon, is a totally private 380-acre island on the River Blackwater, and has been settled for over 5,000 years, boasting a fascinating history around its top-secret role during WWI.
It includes 38 residential properties, ranging from large houses to small holiday lets, and nince commercial properties that can be used for hosting events, film shoots, wellness retreats and many other exciting opportunities.
The guide price is £25,000,000. Please get in touch with Georgie Veale for more information.
Discover more farms and estates on the market with Knight Frank.
Property markets
Farmland Q1 2025 - Values resilient
The farmland market in England and Wales is holding steady in the face of mounting sector pressures. Despite wider challenges across the agricultural sector and ongoing policy uncertainty, values have remained largely stable, underlining the market’s resilience.
The Knight Frank Farmland Index, which tracks the average price of bare agricultural land across England and Wales, showed a marginal drop of 1% in the first quarter of 2025 to £9,072/acre. This follows a similar small decline in the final three months of 2024, bringing the annual fall to just 1.9%.
“While farmer protests and policy reform have dominated headlines, the farmland market itself has experienced a fairly uneventful start to the year,” says Will Matthews, our Head of Farms and Estates.
“Values have remained steady, and relatively few new properties have been put up for sale so far in 2025.” Just over 8,000 acres were publicly launched during the first quarter – a drop of 11% compared with the same period last year.
Country houses Q1 2025 - Mixed picture
The average price of desirable homes in the countryside slipped by just 0.3% in the first quarter of the year, according to the Knight Frank Prime County House Index.
Over the past 12 months, values have fallen by 1.6%. "Expectations of an extra base-rate cut by the Bank of England this year could help steady markets," says Tom Bill, Head of UK Residential Research.
However, the top end of the market is faring less well as wealthier buyers worry about Keir Starmer’s reforms to the non-dom tax regime and general attitude towards the rich.
Average prices for properties over £5 million have fallen 3% on an annual basis, with the number of new applicants falling 15% in the first quarter compared with the same period in 2024.
Development land Q4 2024 - Housing delivery down
Only 2% of the 50 housebuilders recently surveyed by Knight Frank believe that the sector will deliver the 300,000 new homes that the government is targeting for 2025.
The gloomy prognosis is contained in the latest instalment of our Residential Development Land Index report, compiled by researcher Anna Ward, which reveals that the price of green and brownfield development land remained flat in the final quarter of the year, despite Labour’s ambitious housebuilding targets and planning reforms.
Download the full report for more insight and data.