UK rural property: Grasping the opportunities
The Knight Frank Rural Property and Business Update – Our weekly dose of news, views and insight from the world of farming, food and landownership
9 minutes to read
Opinion
The government's charm offensive with the rural sector is really in full swing with the launch of its latest policy paper, Unleashing rural opportunity. If the polls are to be believed, it is not going to be easy for the Tories to turn around their ratings in the countryside. Will this latest paper make a difference - I sense it may take more. Turning the plans into tangible outcomes that rural communities will actually see on the ground would be a start. But if the experience of accessing one of the current rural grant funds is anything to go by (story below), just rolling out new initiatives and lowering barriers isn't going to be enough if rural communities and businesses are to truly grab the opportunities they need MT
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Andrew Shirley Head of Rural Research; Mark Topliff, Rural Research Associate
In this week's update:
• Commodity markets – Lamb prices pass their peak
• Policy – Defra unleashes its rural action plan
• Grants – Northern counties struggle with rural funding
• Public rights of way – Landowner fined after cow attacks
• Shooting – BASC launches Defra legal challenge
• Badger culling – Natural England expands zones
• Out and about – The Rural Report comes together
• Farm fires – Six-point plan of precautions
• House prices – Country homes take a dip
• Farmland Index – Prices rise in quarter 1
• The Wealth Report – 2023 edition out now
• Farmland Index – Agri-land 2022's top-performing asset
• On the market – Commercial Zambia arable opportunity
Commodity markets
Lamb prices pass their peak
Grain and oilseed spot prices saw some rebound on the week. November 2023 contracts also increased in part with the news that the Ukrainian dam explosion will flood about 10,000ha of farmland and cause issues for irrigation systems. On the back of this, Ukrainian grain import limits to its neighbouring EU member states, will be extended to 15 September. Lamb prices this week have probably confirmed that they are passed their annual peak but remain strong, being 25p/kg up on last year as supplies are lower MT
Talking points
Policy – Defra unleashes its rural action plan
The government is seemingly on a schmoozing campaign to prove it’s on the side of the rural community after polls showing Tory support slipping in the countryside. So hot off the heels of the Farm to Fork summit comes the government's Unleashing Rural Opportunity. So, what does the 28-page document contain? Confirmation of what the government is already doing – tick. Promises of what more the government will do – tick, and plenty of planned consultations – tick.
The document also cites that rural areas contribute 15% to England's economy, worth about £250 billion of the national GDP and lays out four main focus areas for the government. Growing the rural economy, improving connectivity, developing housing and energy supplies and finally, improving community living. These themes it is hoped will help the government achieve a levelling up between rural and urban areas.
Internet connectivity is a significant issue for remote areas, and one of the headline announcements was a £7 million fund to help test satellite, wireless and fixed-line systems. Defra says this will support farmers and tourism businesses to access "lightning-fast, reliable connectivity". In one of the consultations outlined in the plan, the government will seek views on cutting red tape to convert redundant farm buildings into family homes. In addition, the government say that it will "fund a network of Rural Housing Enablers across England with £2.5 million. This will boost the supply of new, affordable housing by identifying development opportunities, supporting site owners and community representatives to navigate the planning system and securing the support of local communities for developments."
Rural businesses will await to see whether these plans turn into outcomes MT
Grants – Northern counties struggle with rural funding
FarmingUK reports that many rural businesses are finding it hard to access the £110m Rural England Prosperity Fund announced last September. The website says that northern counties are experiencing confusion around the application process and deadlines.
The fund is meant for rural businesses to help them become fit for the future and deliver levelling up for rural communities. Funding for projects includes farm shops, wedding venues or tourism facilities or improvements to village halls, pubs and other rural hubs. However, the grant funding is being delivered through local authorities, each of which specifies the types of capital projects that are eligible, and each runs its own application process MT
Public rights of way – Landowner fined after cow attacks
A landowner has been hit with a £15,000 fine after two separate incidents of walkers being attacked by cattle on his estate in Wiltshire. In each incident, the walkers were knocked over and stamped on whilst using a public right of way in a field being grazed by cows and calves. It was found that there had been no measures to segregate the cows from the footpath. The Health and Safety Executive said: "Where possible, cows with calves should not be grazed in fields where there is a public right of way. Where this is not possible, they should be segregated from the footpath by appropriate fencing where it is reasonable to do so." Sir Charles Hobhouse pleaded guilty and was sentenced on 8 June to pay costs of £8,000 in addition to the fine MT
Shooting – BASC launches Defra legal challenge
In a follow-up to our story last week, the BASC has instructed lawyers to begin legal proceedings against Defra over its general licence withdrawal. The General Licence (GL43), which permits the release and management of gamebirds on and near Special Protection Areas (SPAs), Special Areas of Conservation (SACs) or within 500 metres of their boundaries, was allowed to expire by Defra on 31 May 2023. The legal challenge will begin the process that will seek permission from the High Court to bring a Judicial Review of Defra's decision.
BASC chief executive Ian Bell said, "BASC's absolute priority is to seek the immediate reinstatement of a workable GL43 system that, as a minimum, allows shoot managers and those affected to get back on with their work and their lives." He added: "We believe the High Court review is necessary to ensure that Defra's processes are changed for the future, and proper engagement with the rural community takes place before any significant changes are introduced" MT
Out and about – The Rural Report comes together
From airfields to country estates, Andrew and I have spent the past few months visiting Knight Frank's clients around the country with our Rural Consultancy colleagues to create content for this year's edition of The Rural Report and our new Rural Matters website. The report is just about to head to the printers now and is going to be chock full of fascinating case studies, data and insights. If you're not already signed up to receive a copy, please let us know, and we'll put you on the list. A lot of last year's content is still relevant so why not have a read while you’re waiting? The Rural Report 2022. MT
Need to know
Farm fires – Six-point plan of precautions
It seems dryer than usual periods and higher risk of on-farm fires are becoming increasingly regular events in recent years. The fire and rescue services, backed by the NFU and NFU Mutual, have issued a new six-point plan to help farmers guard against fires this harvest.
Alex Nelms, NFU county chair for Berkshire, Buckinghamshire and Oxfordshire, said: "Our advice is to keep farm vehicles maintained at all times. This includes combine harvesters which should be cleared out regularly during harvest. It's also important to keep a serviced fire extinguisher on hand. If the worst happens and there is a fire on farm, having an emergency plan and staff trained on what to do is really important. It also helps to have information on how to access water supplies and have a bowser filled with water, tractor, and plough ready to create a fire break if needed" MT
Badger culling – Natural England expands zones
A further 11 new zones in England will receive supplementary cull licences to undertake badger control operations. Natural England has authorised the new licences on top of the existing 18 areas that will also resume culling. Defra said that "1 June is the earliest possible date for the start of operations and is the start of the open season."
Defra is seeking to move away from culling towards vaccination and increased cattle testing. Trials for a cattle vaccine and new skin test for the endemic disease have so far been successful, the Animal and Plant Health Agency (APHA) announced in February. It is hoped that the combination of CattleBCG vaccine and the Detect Infected among Vaccinated Animals (DIVA) skin test will be deployable in the next few years MT
Knight Frank Research
House prices – Country homes take a dip
The average value of country houses fell by 0.5% in the first quarter of the year as the cost of borrowing continued to rise, according to the latest findings from the Knight Frank Prime Country House Index. On an annual basis prices have dropped by 0.8%. Demand remains strong, but transaction numbers fell in the aftermath of Liz Truss's mini budget last autumn. "Ultimately, despite resilient demand, we expect the reduction in spending power caused by the increase in the cost of borrowing and improved supply to see prime regional prices decline by a few percentage points in 2023," predicts my colleague, Chris Druce.
Farmland Index – Prices rise in quarter 1
Agricultural land proved resilient in the first three months of 2023. While residential property values weakened, the average price of bare farmland rose by 2%, edging closer to £9,000/acre, according to the Knight Frank Farmland Index. The hike takes the annual rise to 11%, reinforcing farmland's reputation as a good hedge against inflation. Read the full report for more data and insight
You can also listen to the latest edition of our Intelligence Talks podcast where I discuss biodiversity net gain and nutrient neutrality schemes with my Rural Consultancy colleague Isabel Swift AS
The Wealth Report – 2023 edition is out now
Knight Frank's leading piece of thought leadership on property and wealth trends was launched recently and includes an interview by me with one of Scotland's pioneering rewilders, as well as some thoughts on why farmland could be one of this year's most in-demand property investments. Download your copy to find out more AS
On the market
Zambia calling – Commercial arable opportunity
Tanya Ware from our Lusaka office has just launched Wheatlands Farm in Zambia's Central Province. The 689-hectare arable commercial opportunity is in the Mkushi farming block, Zambia's agricultural heartland. Over 500 hectares of centre pivot irrigated land deliver wheat yields of over 8t/ha and over 3t/ha of soyabeans. The farm has a 3.6 million cubic-litre irrigation permit. The guide price is US$5.5 million. Contact Tanya for more information.