Arable farms face ‘economic storms’ post-harvest

Jul 3, 2024

Arable farmers are being advised to ‘work closely with their accountant’ in the wake of figures forecasting post-harvest losses in 2024.  

The figures, produced by Strutt & Parker, are based on a 131ha in-hand holding with an expected winter wheat yield of 7.5t/ha in 2024 

They predict an £80/ha margin – a drop of £119ha compared with 2023 – assuming growers have managed to drill spring crops on unplanted winter crop areas. 

This would lead to a whole farm net margin of just £10,480 to cover rent, finance, drawings, and reinvestment, placing farmers in a tight position.  

The situation could be exacerbated for smaller farmers who often show a deficit of funds.  

Whereas banks are supportive or larger, secure farming operations, they are starting to apply pressure to those that routinely go into the red to change from an overdraft facility to a repayment loan, placing even greater burdens on their finances.  

Ian Parker, agricultural tax expert at Whitely Stimpson, said farmers must proactively manage the things they have control over to protect their businesses.  

He said:

“There are so many unforeseeable and uncontrollable elements that impact on farming from the weather to geopolitics, commodity price volatility, input availability and costs, and the increased cost of working capital. All of these have to be juggled as best they can be, which is why it is imperative for farmers to manage the things they can control, such as cash flow, fixed and variable costs, borrowing, efficient staffing, and other business and financial processes that will impact on how profitable and sustainable a farm enterprise will be. This is particularly the case for arable farmers heading into harvest 2024 and beyond, where predicted losses could take their toll.” 

Ian added with judicious management, farmers should be able to weather any financial storms during the medium term until harvest 2025, where margins are predicted to return to normal. 

“Growers might have to endure some short-term pain,” he said. “But with solid advice and prudent management, there is light at the end of the tunnel.”

Contact us

To speak to us about cash flow planning or any other business advice, contact Ian Parker on (01295) 270200 or email 

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