COVID-19: The impact on Agriculture

2020 was always going to be a challenging year for Agriculture in the UK. Brexit, the Budget, a new Agricultural Bill, suspected tax reforms, and now we are facing the biggest pandemic since Swine Flu. COVID-19 has affected over 75 countries, infected over 200,000 people worldwide, with numbers growing daily; what can those of us working in the Agricultural industry expect over the coming months?

Overseas Workers/Labour

On average, over 50,000 seasonal workers are required on British farms each year to harvest crop, many of those working coming from overseas. The increasing number of international travel restrictions and the tightening of border controls as a result of COVID-19 means that, unfortunately, overseas workers are going to struggle to travel to the UK. Unless labour can be effectively transferred from other sectors, like the hospitality industry, this presents a serious challenge to many farmers.

HOPS Labour Solutions Ltd along with The National Young Farmers’ Clubs are urgently calling for an increase in British workers.

Panic Buying

One of the biggest talking points in the media at the moment is the stock-piling of food. Many supermarket shelves are emptying as quickly as they are being filled, despite Government pleas and assurances that the UK’s supply chain is sufficient.

History has proven that panic buying during pandemics has a detrimental impact on the global food market; supply chains run out, demand increases and prices fluctuate. This week alone has seen a rise in beef and lamb prices.

Ban on Public Gatherings

As the Government calls for the UK to avoid public gatherings and avoid all non-essential travel wherever possible, further restrictions on the operation of Auctions, and possible closures, could be on the cards. However, the Government will undoubtedly be keen to preserve the foodchain. Restrictions on Auctions will have a massive impact on the industry, not only economically, but also socially. Many Farmers enjoy their weekly trips to the Auction and closures and restrictions will be acutely felt across the sector.

The Agricultural Show season, which attracts hundreds of thousands of visitors annually, is expected to start mid-April. However, many shows nationally are now either being cancelled or postponed due to the outbreak. It appears that the remainder will shortly follow suit.

Financial Support

The UK Government have announced a £330billion bailout fund available to businesses across the UK that are affected by COVID-19; those to benefit include small businesses and the self-employed. The bailout fund includes government grants of up to £10,000 to help towards business costs, as well as government-backed bank loans of up to £5million. Mortgage payment holidays are to be introduced and, small businesses that cannot afford to pay their tax bills can apply for a “time to pay” agreement with HM Revenue & Customs which temporarily suspends debt collection. This is just the situation as of the date of this article; new measures are being introduced daily.

Financial support and advice, as well as emotional and general support, can be sought from the following charities:

• Farming Help
• The Royal Agricultural Benevolent Institution
• The Farming Community Network
• Addington Fund

The UK’s Agricultural Industry is extremely resilient; farming is a stressful occupation at the best of times. Through what will be an extremely difficult few months, not only for farming businesses, but for everyone, Burnetts Agribusiness Team advise our clients to:

• Follow the Government Guidance;
• Start looking for seasonal workers earlier than normal, consider using family and friends if possible;
• Use the Government funding;
• Seek support if needed;
• Start planning: speak with your Accountant, Bank Manager, Land Agent, Solicitor to see whether they have any advice or recommendations for your business; your professional advisors are here to support you and your farming business through this difficult time.