Unearthing a blueprint for new entrants striving to establish their own farm business in the UK

1.
PLOUGHING
YOUR
OWN
FURROW:
Unearthing
the
blueprint
for
new
entrants
striving
to
establish
their
own
farm
business
in
the
UK.
G e o r g e
B r o w n
A p r i l
2 0 1 2

2.
ACKNOWLEDGEMENTS
I
am
grateful
to
a
number
of
individuals
who
have
been
incredibly
patient
in
answering
my
many
and
varied
questions.
While
the
views
presented
here
do
not
necessarily
reflect
their
own,
they
have
been
invaluable
in
shaping
arguments
in
this
study.
They
include:
• Ruth
Layton
of
FAI
Farms,
• Mike
Gooding
of
FAI
Farms,
Chairman
of
the
Oxford
Farming
Conference
Council
2012
• Charles
Baines
of
Laurence
Gould
• Alison
Rickett,
National
Fresh
Start
Coordinator
• Richard
Gooding
of
BQP
• Martin
Law
of
Hardcastle
Burton
• Jim
Baird,
Nuffield
Scholar
2011
• George
Dunn,
Chief
Executive
of
the
TFA
• Oliver
Hardwood,
Chief
Surveyor
at
the
CLA
• Rupert
Clark,
Partner
and
Head
of
Rural
Estate
Management
at
Smiths
Gore
• Ian
Pigott,
Nuffield
Scholar
2002
and
Founder
of
Open
Farm
Sunday
• Sarah
Palmer,
NFYFC
Agriculture
and
Rural
Affairs
Officer
I
am
also
extremely
grateful
to
the
farmers
who
agreed
to
be
case
studies
in
this
project.
They
provided
me
with
a
fantastic
array
of
information
and
are
some
of
the
most
inspirational
people
I
have
ever
met.
They
are
listed
in
the
appendices
at
the
end
of
this
study.
Finally
I
would
like
to
thank
my
college
for
their
support
in
funding
some
of
the
travel
expenses
incurred
in
undertaking
this
research,
and
Mary
Young,
my
long
suffering
dissertation
supervisor,
for
all
of
her
help
in
developing
this
report.
2

3.
CONTENTS
Introduction
4
Literature
Review
5
Methodology
11
Data
Presentation
12
The
Blueprint
–
Land
15
The
Blueprint
–
Capital
24
The
Blueprint
–
Output
29
The
Blueprint
–
Labour
34
Conclusion
38
Endnote
42
Bibliography
43
Appendices
49
3

4.
INTRODUCTION
Concern
over
the
number
of
young
people
pursuing
careers
in
agriculture
has
recently
received
much
attention
in
the
farming
press.
A
number
of
factors
have
been
highlighted
as
contributing
towards
the
aging
agricultural
workforce,
but
to
date
the
literature
available
has
offered
little
in
the
way
of
practical
guidance
for
new
entrants
striving
to
establish
their
own
farm
business.
Two
quotations
succinctly
contextualise
this
issue,
and
consequently
clarify
the
aim
of
this
dissertation.
“Encouraging
the
next
generation
to
be
motivated
about
starting
their
own
business
is
vital
to
building
a
stronger
future
for
British
farming.
We
need
young
people
with
ideas,
ambition,
commercial
acumen,
skills
and
drive,
if
the
challenge
of
producing
more
food
and
impacting
on
the
environment
less
is
to
be
realised.”
(King,
2011)
“This
winter
[2011/2012],
CAP
reform
aside,
I
have
heard
more
presentations
on
‘new
entrants’
than
anything
else.
The
subject
is
hugely
important,
but
I
have
been
disappointed
by
the
array
of
papers
I
have
heard.
None
have
offered
any
substance
beyond
rhetoric
and
utopian
wishes.”
(Pigott,
2011)
This
paper
seeks
to
look
beyond
the
“rhetoric
and
utopian
wishes”
and
uncover
the
practical
means
by
which
new
entrants
to
agriculture
to
establish
a
thriving
farm
business?
Definitions
“There
are
three
recognised
routes
to
farm
ownership:
patrimony,
matrimony
and
parsimony.”
(Shadbolt
and
Martin,
2005,
p270)
The
terms
‘new
entrant’
and
‘young
farmer’
shall
be
used
interchangeably
throughout
this
analysis.
Art.
8
Council
Regulation
Ec
1257/1999
defines
a
young
farmer
as
someone
under
40
years
of
age,
possessing
adequate
occupational
skills,
setting
up
as
the
established
head
on
an
economically
viable1
agricultural
holding
for
the
first
time.
While
this
definition
is
not
without
fault2,
it
nonetheless
serves
as
an
adequate
guideline
in
defining
the
type
of
person
described
as
being
a
‘new
entrant’
in
this
paper.
Nevertheless,
more
simply,
how
can
ambitious
young
1
‘Economically
viable’
is
defined
as
fulfuling
one
of
the
thresholds
given
in
Regulation
(EC)
No
1166/2008
ANNEX
II,
namely
that
the
holding
consists
of
more
than
5
hectares
of
agricultural
land,
one
hectare
of
orchards,
0.5
hectares
of
vegetables
or
0.1
hectares
of
protected
crops,
or
more
than
10
cows,
50
pigs,
20
sheep,
20
goats,
or
1,000
poultry.
The
same
criteria
are
also
used
by
DEFRA
(2010)
to
define
the
minimum
threshold
deemed
to
be
‘commercial’.
2
For
example,
a
‘new
entrant’
may
not
be
establishing
themselves
as
the
head
of
the
holding
straight
away,
or
may
have
already
gained
a
delicate
foothold
in
the
industry
but
still
face
a
number
of
obstacles
that
are
the
same
as
those
faced
by
someone
deemed
to
be
a
‘new
entrant’
(TFF,
2008),
4

5.
people
with
little
prospect
of
acquiring
a
farming
enterprise
through
patrimony
or
matrimony,
assist
themselves
in
developing
a
farm
business?
A
health
warning
“[T]he
first
rule
of
first
generation
farming
is
you
don’t
whinge
–
it’s
up
to
you
and
no
one
else.”
(Blanche,
2011,
p11)
While
it
will
be
demonstrated
that
a
number
of
factors
currently
make
it
difficult
for
new
entrants
to
establish
a
farm
business,
it
is
not
the
intention
of
this
paper
to
criticise
current
policy
or
campaign
for
reform.
Instead
the
aim
is
to
analyse
solutions
to
the
barriers
to
entry
as
they
currently
exist.
To
many
these
metaphorical
hurdles
seem
insurmountable,
and
it
is
therefore
hoped
this
dissertation
will
examine
some
of
the
ways
in
which
successful
new
entrants
have,
and
can,
overcome
them.
This
analysis
will
not
seek
to
unearth
a
single
‘best’
solution;
farming
is
an
incredibly
diverse
industry
therefore
a
one-­‐size-­‐fits-­‐all
answer
is
unlikely
to
exist.
That
said,
there
are
a
number
of
common
issues
facing
new
entrants,
thus
it
is
not
unreasonable
to
suggest
that
there
may
also
be
a
number
of
common
solutions.
LITERATURE
REVIEW
Agriculture’s
labour
force
“[T]he
industry
is
facing
a
recruitment
and
succession
crisis
with
the
average
age
of
farmers
in
the
UK
at
58
and
rising.”
(The
National
Trust,
2001,
p2)
In
England,
52%
of
farmers
are
aged
over
55,
compared
to
just
22%
of
the
self-­‐employed
urban
workforce
(ADAS,
2004).
Nationally,
the
median
age
of
farm
holders3
varies
from
55
to
60
years
across
all
farm
types
(DEFRA,
2011),
and
almost
half
of
National
Trust
tenant
famers
are
past
retirement
age
or
within
10
years
of
it
(The
National
Trust,
2008).
The
problem
extends
beyond
just
the
age
of
farm
holders.
In
the
UK
a
quarter
of
the
sector’s
workforce
is
55
or
older4
(LANTRA,
2011a).
Across
Europe
this
figure
is
higher
still,
with
47%
of
agricultural
workers
in
the
EU-­‐15
being
55
years
or
older
(DGARD,
2010),
and
while
there
has
been
a
decrease
in
the
total
number
of
farmers
by
9%
from
2000-­‐2007,
the
number
of
farmers
under
the
age
of
35
has
fallen
by
42%
in
this
same
period
(DGARD,
2010).
3
The
‘holder’
being
defined
as
the
person
in
whose
name
the
holding
is
operated
(DEFRA,
2011)
4
Compared
to
a
UK
average
of
17%
5

6.
British
further
and
higher
education
institutions
have
been
producing
just
50-­‐70%
of
the
recruits
that
UK
employers
need5
(Spedding,
2009),
and
the
National
Employer
Skills
Survey
2009
revealed
that
8%
of
UK
agricultural
industry
employers
had
a
vacancy
at
the
time
(LANTRA,
2011b).
Farming
is
‘crying
out’
for
new
entrants
(Tasker,
2011).
Forecasts
suggest
that
the
UK
agricultural
industry
will
need
approximately
60,000
new
entrants
coming
into
the
sector
between
2010
and
2020
(LANTRA,
2009;
Spedding,
2009;
LANTRA,
2011a),
and
it
is
apparent
that
even
if
overall
employment
in
agriculture
does
continue
to
decline6,
there
will
still
be
a
significant
demand
to
replace
those
who
are
exiting
from
the
sector
(Spedding,
2009).
The
significance
of
an
aging
agricultural
workforce
“The
key
to
developing
an
agricultural
industry
we
can
be
truly
proud
of
in
a
worldwide
context
is
innovation.
They
key
to
innovation
is
new
ideas
and
individuals
willing
to
develop
these
ideas
with
dynamism.
Innovation
is
a
dish
best
served
by
the
desperate
and
the
different,
those
with
little
to
lose
but
a
massive
need
to
succeed.”
(Blanche,
2011,
p7)
Dwindling
entry
of
such
magnitude
normally
characterises
an
industry
in
decline
(Gale,
1993),
however
as
agriculture
and
food
are
strategic
sectors
impacting
significantly
upon
rural
communities
and
the
British
economy
(ADAS,
2004;
Williams,
2006;
Price’s
Trust,
2008;
CEJA,
2011),
this
degeneration
cannot
be
allowed
to
occur
unchecked.
Farming
needs
to
attract
progressive
and
entrepreneurial
individuals
with
outstanding
business
management
skills,
who
embrace
change
and
steer
the
political
agenda
(Spedding,
2006,
2009).
Studies
have
identified
age
as
a
barrier
to
the
introduction
of
more
effective
and
efficient
management
practices
(Foskey,
2005
cited
in
Owen,
2009)
and
it
is
noted
that
the
innovative,
entrepreneurial
and
risk
taking
abilities
of
new
entrants
are
beneficial
to
the
industry
(Shadbolt
and
Martin,
2005;
Owen,
2009).
Younger
farmers
have
been
shown
to
be
better
trained
than
their
older
counterparts7
(DGARD,
2010),
and
new
entrants
are
also
considered
more
adaptable
and
more
focussed
on
longer-­‐term
success
(Williams,
2006).
Farmers
below
35
years
old
also
show
40%
more
economic
potential
than
their
superiors
(DGARD,
2010).
5
Although
is
should
be
noted
that
enrollment
on
agriculture
and
related
courses
has
recently
increased,
and
in
fact
saw
the
greatest
percentage
increase
across
undergraduate
courses
between
2009/10
and
1010/11
(HESA,
2012)
6
Which
would
seem
likely
given
that
it
is
a
near-­‐universal
feature
that
the
percentage
of
the
population
involved
in
agriculture
declines
with
a
nation’s
increasing
economic
development
(ADAS,
2004)
7
“The
share
of
farmers
with
full
agricultural
training
decreases
with
increasing
age
of
the
farmer”
(DGARD,
2010
p.21)
6

7.
Moreover,
Lobley
et
al.
(2002)
categorised
farmers
into
3
groups:
those
who
‘embrace’
change
(31%
of
respondents),
those
who
change
in
response
to
new
pressures
and
opportunities
(‘reactors/adaptors’,
51%)
and
those
who
‘resist’
change
(18%).
While
every
age
group
could
be
found
in
each
category,
‘embracers’
were
generally
shown
to
be
better
educated8,
“somewhat
younger”
and
on
bigger
farms9.
This
goes
some
way
towards
explaining
why,
despite
the
fall
in
number
of
young
farmers
across
the
EU-­‐12,
there
has
been
an
increase
in
the
area
farmed
by
them,
implying
that
those
few
who
have
stayed
in
business
have
increased
the
size
of
their
holdings
(DGARD,
2010)
and
that
it
is
they
who
are
therefore
achieving
the
economies
of
scale
required
to
keep
many
farm
businesses
viable.
Lobley
et
al.,
(2002)
also
found
that
‘static’
businesses
were
far
less
likely
to
be
operated
by
young
farmers10,
suggesting
that
an
ambitious
young
workforce
could
strengthen
a
dynamic
agricultural
industry.
Thus,
the
main
reason
that
the
aging
agricultural
workforce
is
an
area
of
policy
concern
is
the
association
of
young
farmers
with
increased
efficiency,
adaptability
and
ultimately
competitiveness
(ADAS,
2004).
“Young
people
matter
for
farming;
we
need
their
vitality
and
new
ideas
to
help
meet
the
challenges
of
increasing
food
production
and
climate
change”
(Princes
Trust,
2008,
p.2).
Of
course
there
remains
a
place
for
the
older
generation
in
farming;
their
wealth
of
skills
and
experience
is
undoubtedly
beneficial.
Nevertheless,
there
is
a
strong
body
of
evidence
suggesting
that
it
would
be
advantageous
for
the
average
age
of
the
industry
to
be
reduced.
After
all,
what
looks
like
a
daunting
future
to
a
60-­‐year-­‐old
farmer
may
represent
a
golden
opportunity
to
a
driven
30-­‐year-­‐old
(Chamberlain,
2006;
Spedding
2006).
Factors
discouraging
entry
to
agriculture
“Most
people
imagine
farmers
to
be
dull,
conventional,
conservative
and
Conservative.”
(Naylor,
2011)
A
number
of
negative
stereotypes
discourage
prospective
new
entrants
from
considering
careers
in
farming.
There
is
a
perception
that
agricultural
employment
involves
working
long
8
71%
of
embracers
had
some
post-­‐school
education
or
training,
and
44%
were
educated
to
diploma
or
degree
level
(compared
to
11%
of
‘resistors’)
(Lobley
et
al.,
2002)
9
Embracers
represented
31%
of
the
respondents,
but
were
responsible
for
45%
of
the
area
surveyed
(Lobley
et
al.,
2002)
10
Only
18%
of
operators
of
static
businesses
were
aged
under
45,
while
73%
of
static
businesses
had
been
in
the
hands
of
their
current
operator
for
20
years
or
more
(Lobley,
et
al.,
2002).
7

8.
hours11
for
low
wages
(Padwick,
2010;
IGD,
2008
cited
in
DEFRA,
2010),
and
that
it
is
a
low
skilled
industry12
(Curry,
et
al.,
2002;
Kyle,
2006),
needing
to
become
more
professional
(Spedding,
2006).
The
result
is
that
potential
new
entrants
don’t
believe
farming
offers
them
a
future
(The
National
Trust,
2008),
and
there
is
strong
consensus
that
the
industry
is
struggling
with
an
out-­‐dated
image
(Spedding,
2009).
Nonetheless,
although
beneficial
in
understanding
the
context,
combating
the
stereotypes
surrounding
agricultural
employment
is
an
entire
issue
in
itself,
beyond
the
scope
of
this
evaluation.
Of
greater
relevance
to
this
study
are
the
practical
problems
facing
prospective
farmers
that
have
served
to
discourage
entry
into
the
industry
and
therefore
encourage
an
aging
workforce.
There
are
two
key
problems
in
this
area:
the
poor
availability
of
land
and
the
high
start
up
costs
of
establishing
a
farm
business
(Williams,
2006;
Ilbery,
2009;
DGARD,
2010;
Blanche,
2011),
the
two
issues
being
closely
linked.
UK
farmland
supply
in
relation
to
new
entrants
“Without
doubt,
access
to
land
remains
the
single
greatest
structural
obstacle
facing
the
new
generations
of
farmers
and
growers.”
(Payne,
2012)
Older
farmers
in
the
industry
who
don’t
want
to
retire
restrict
the
‘room’
available
for
new
entrants
(Owen
and
Cowap,
2009).
Retirement
from
farming
is
often
a
progressive,
drawn-­‐out
affair,
different
from
the
dramatic
change
in
lifestyle
often
experienced,
for
example,
by
blue-­‐
collar
workers
(ADAS,
2004).
Indeed,
Errington
(2002)
identified
a
“succession
ladder”
within
farm
businesses,
where
retirement
of
the
older
party
is
protracted
over
5
stages13.
11
ONS
statistics
show
the
average
working
week
in
the
agriculture
and
fishing
sector
is
46.4
hours,
(compared
to
a
national
average
of
31.7
hours
per
week
in
the
period
April-­‐Jun
2011)
and
rises
to
50.8
hours
when
only
the
hours
worked
by
men
(who,
after
all,
account
for
77%
of
the
workforce
in
agriculture
(LANTRA,
2011b))
are
considered
(ONS,
2011b).
The
average
number
of
hours
worked
by
employees
in
agriculture
climbs
further
still
when
farm
workers
specifically
are
calculated,
rising
to
52
hours
per
week.
On
top
of
this,
during
peak
times
the
average
number
of
hours
in
a
farm
worker’s
week
escalates
to
80
hours,
with
23%
of
them
working
100+
hours
in
their
peak
week
(Padwick,
2010)
12
In
spite
of
the
considerable
skill
level
within
the
industry,
only
20%
of
the
workforce
are
qualified
to
level
4
and
above,
and
24%
have
no
qualifications.
This
is
compared
with
36%
and
7%
respectively
across
all
sectors
in
the
UK.
(Higher
Education
Statistics
Agency
cited
in
LANTRA,
2011b)
13
First
technical
and
tactical
decisions
are
shared,
such
as
day
to
day
planning
and
organisation
of
work.
Secondly
the
successor
becomes
involved
in
strategic
planning
of
the
business
and
in
long
term
decision
making.
Then
employment
and
staff
management
decisions
are
shared,
before
fourthly
the
successor
becomes
directly
involved
in
financial
matters
such
as
negotiating
sales
and
loans.
The
fifth
and
final
stage
in
completing
succession
of
the
farm
8

9.
Personal
reasons
that
discourage
the
retirement
of
older
partners
from
farms
include
their
enjoyment
of
farming,
a
desire
to
maintain
control,
general
inertia,
their
ability
to
work
to
a
greater
age
and
emotional
ties
to
the
business
(ADAS,
2004;
Baird,
2011;
Hanson,
2011).
Financial
issues
such
as
being
unable
to
afford
to
retire,
an
inadequate
pension,
subsidies
cushioning
risk
(Mishra
and
El-­‐Osta,
2008,)
and
inheritance
tax
advantages
are
seen
to
further
delay
retirement,
as
do
practical
problems
such
as
the
lack
of
a
successor14
(Williams,
2006;
Ilbery,
et
al.,
2009).
Thus,
for
many
reasons
farmers
may
avoid
retirement,
restricting
the
supply
of
land
for
new
entrants.
Combined
with
this
is
the
difficulty
new
entrants
face
in
obtaining
tenancies
from
traditional
sources.
While
the
National
Trust
owns
245,000
hectares
of
countryside15
(The
National
Trust,
2001),
turnover
of
Trust
farms
is
slow16
(The
National
Trust,
2008).
County
Council
Smallholdings
(county
farms)
are
also
hard
to
come
by,
with
the
number
having
fallen
by
72.5%
from
1964-­‐2007
(Ilbery,
et
al.,
2009)
as
holdings
were
sold
off
or
amalgamated
to
create
bigger
units17
(Gemmill,
2005;
Ilbery,
et
al.,
2009;
LANTRA,
2009;
TFA,
2010;
RICS,
2011a).
The
options
open
to
new
entrants
to
acquire
land
through
these
two
traditional
routes
are
therefore
negligible.
Simultaneously,
land
values
have
been
climbing.
It
is
generally
accepted
that
farmland
prices
are
high
in
relation
to
their
potential
productive
agricultural
return
(ADAS,
2004;
Gemmill,
2005;
Shadbolt
and
Martin,
2005),
and
they
reached
record
highs
in
the
first
half
of
201118
fuelled
by
increasing
demand
from
commercial
buyers
(RICS,
2011b).
Referred
to
as
being
like
“gold
with
a
cash
flow”
(Farming
Today,
2012),
land
remains
a
prime
asset
class
in
turbulent
markets
(RICS,
2011b)
and
commercial
buyers
continue
to
invest
in
order
to
increase
output
and
capitalise
upon
strong
commodity
prices.
Residential
demand
also
remains
firm,
with
the
business
occurs
when
the
successor
is
finally
given
control
of
the
purse
strings,
and
control
of
the
cheque
book
is
relinquished
(Errington,
2002).
14
Due
to
children
from
farming
families
electing
other
career
paths,
there
being
no
other
family
members
wanting
to
take
up
the
reigns,
or
the
business
being
unable
to
sustain
the
involvement
of
another
partner
(Williams,
2006).
15
60%
of
which
is
let
out
as
whole
farms
to
700
tenants
(The
National
Trust,
2001)
16
Only
ten
to
fifteen
National
Trust
farms
become
available
to
let
each
year
(The
National
Trust
2008)
17
Currently
the
national
estate
stands
at
less
than
125,000
hectares,
with
Cambrigeshire
Country
Council
owning
more
than
10%
of
this;
holding
an
estate
of
13,500
hectares
(Cambridgeshire
County
Council,
2011a).
However
even
in
Cambridgeshire,
just
3
new
tenants
were
taken
onto
County
Council
farms
during
2011,
illustrating
how
few
holdings
are
available
(Cambridgeshire
County
Council,
2011b).
18
At
£7,479
per
acre
for
land
which
includes
a
residential
component,
and
a
hypothetical
£6,115
per
acre
for
pure
bare
land
values
(RICS,
2011b)
9

10.
‘lifestyle
value’
of
land
being
high
(Ingram
and
Kirwan,
2011)
particularly
in
areas
close
to
large
conurbations.
Thus
it
is
apparent
that
the
demand
for
farmland
from
commercial
and
lifestyle
buyers
contributes
to
higher
land
values
that
price
many
young
farmers
out
of
the
market.
A
remaining
option
for
new
entrants
is
to
rent
land
under
Farm
Business
Tenancies19
(FBTs).
Created
to
reduce
tenant
immobility
and
thus
encourage
the
letting
of
agricultural
land
(ADAS,
2004),
FBTs
theoretically
offer
new
entrants
the
opportunity
to
farm.
However,
in
helping
young
farmers
the
effects
of
the
ATA
1995
have
been
‘disappointing’
(Whitehead,
et
al.,
2002;
TRIG,
2003).
When
FBTs
do
become
available,
demand
for
land
from
neighbouring
farmers
is
often
high
as
they
anticipate
being
able
to
increase
output
without
much
increase
in
fixed
costs
(ADAS,
2004)
thus
meaning
they
can
outbid
new
entrants.
The
result
is
that
new
entrants
“feel
barred
to
a
great
extent
from
taking
up
such
opportunities
because
of
the
high
rents
and
stiff
competition
from
established
farmers
for
the
FBTs
available”(Whitehead,
et
al.,
2002,
p60).
Furthermore,
the
short
duration
of
many
FBTs20
(Ingram
and
Kirwan,
2011;
Walker,
2011)
prevents
tenants
from
planning
for
the
long
term.
Capital
costs
of
farm
business
establishment
‘For
the
group
of
former
students
not
brought
up
on
a
farm
but
who
had
intended
to
enter
farming,
lack
of
capital
was
the
main
constraint”
(ADAS,
2004)
There
are
large
capital
costs
associated
with
building
many
farm
businesses,
and
it
is
generally
the
excessive
fixed
costs
rather
than
high
variable
costs
that
are
problematic
for
new
entrants
(Shadbolt
and
Martin,
2005).
For
example,
to
purchase
11721
freshly
calved
dairy
cows
at
July
2011
prices22,
would
cost
£151,398
and
that
is
before
any
of
the
infrastructure
necessary
for
their
management
has
been
purchased.
Put
in
perspective,
this
figure
is
almost
7
times
the
average
annual
salary
of
a
farm
worker
(Padwick,
2010),
reinforcing
how
large
this
capital
threshold
is
likely
to
seem
to
prospective
young
farmers
seeking
to
develop
their
own
farming
enterprise.
Additionally,
new
entrants
suffer
from
diseconomies
of
scale
in
establishing
their
businesses,
meaning
that
their
capital
costs
are
comparatively
higher
than
those
of
larger
producers
19
Introduced
by
the
Agricultural
Tenancies
Act
1995
(ATA
1995)
20
The
average
length
of
FBTs
is
now
consistently
under
four
years
(TFA,
2010;
RICS,
2011a)
21
The
UK
average
dairy
herd
size
in
the
2010
June
Census
was
117
cows
(DairyCo,
2011)
22
The
average
price
of
freshly
calved
dairy
cows
in
July
2011
was
£1,294/head
(AHDB,
2011)
10

11.
(ADAS,
2004;
Shadbolt
and
Martin,
2005).
The
capital
costs
in
starting
a
farm
business
are
therefore
a
significant
‘barrier
to
entry’
faced
by
new
entrants.
Agricultural
subsidisation
“I
have
never
been
comfortable
with
agricultural
subsidies…
They
diminish
the
impetus
to
innovate,
they
protect
inefficiency
and
therefore
reduce
business
fluidity.”
(Baird,
2011,
p8)
Currently
the
Common
Agricultural
Policy
(CAP)
presents
new
entrants
with
a
number
of
problems,
not
least
that
subsidies
are
capitalised
in
land
and
asset
values,
increasing
the
cost
of
farm
business
establishment
and
expansion
(Baird,
2011).
In
recognition
of
the
difficulties
faced
by
new
entrants,
it
is
expected
that
the
forthcoming
CAP
reforms
will
offer
more
support
for
young
farmers,
most
likely
under
Pillar
2.
However,
while
any
such
measures
will
be
beneficial,
the
current
playing
field
is
so
far
from
being
level
that
any
changes
to
the
subsidisation
scheme
are
unlikely
to
make
it
easy
for
new
entrants.
Thus,
the
ultimate
success
of
any
new
entrant
will
still
depend
more
on
the
“skills,
vision,
determination
and
budgetary
controls”
of
the
young
farmer
than
the
particular
subsidy
on
offer
(Gemmill,
2005,
p4).
This
being
the
case,
what
are
the
options
for
new
entrants
looking
to
overcome
these
barriers
and
establish
their
own
farm
business?
METHODOLOGY
“The
problems
that
are
studied
are
real
ones
to
farmers,
and
so
must
be
studied
in
the
context
of
a
real
world
situation.
Therefore,
the
case-­‐study
approach
cannot
easily
be
divorced
from
the
study
of
farm
management.”
(Shadbolt
and
Martin,
2005,
p11)
The
‘transdisciplinary’
nature
of
farming23
makes
case-­‐study
based
analysis
essential
in
understanding
farm
business
decision
making
(Shadbolt
and
Martin,
2005),
and
solutions
to
the
practical
difficulties
that
face
young
farmers
today
are
best
identified
through
analysing
the
means
by
which
previous
new
entrants
have
overcome
similar
hurdles.
A
number
of
exceptional
individuals
have
managed
to
develop
farm
businesses,
and
so
it
is
hoped
that
through
interviewing
these
new
entrants
and
understanding
the
variables
that
have
contributed
towards
their
success,
a
number
of
common
factors
have
been
identified
that
could
be
replicated
by
future
young
farmers
looking
to
emulate
their
achievements.
23
Describing
how
successful
farm
management
draws
upon
many
different
disciplines
to
resolve
a
variety
of
problems
(Shadbolt
and
Martin,
2005)
11

12.
Such
exceptional
individuals
are
often
highlighted
in
the
farming
press
so
some
have
been
identified
by
this
means.
However,
further
case
studies
were
sourced
through
contacting
prominent
individuals
within
the
industry
and
seeking
recommendations
from
them,
in
the
process
also
drawing
on
their
own
expertise
in
relation
to
this
topic.
It
remains
the
proximal
aim
of
this
study
to
‘unearth
a
blueprint’
for
young
farmers
seeking
to
develop
their
own
farm
businesses.
While
in
reality
it
may
not
be
possible
to
establish
a
single
‘best’
template
for
prospective
new
entrants,
to
attempt
to
base
such
a
blueprint
of
the
experiences
of
suboptimal
businesses
would
seem
somewhat
futile.
Accordingly
this
study
remains
focused
on
an
exceptional
minority
of
successful
young
farmers
in
the
hope
that
identifiable
common
factors
can
be
replicated
by
a
wider
majority
of
new
entrants.
Biophysical,
financial
and
human
resources
are
all
employed
in
a
farm
business
(Shadbolt
and
Martin,
2005)
and
conventional
economic
terminology
suggests
these
can
be
classified
as
land,
capital
and
labour.
This
analysis
therefore
evaluates
the
options
available
to
new
entrants
looking
to
resolve
issues
relating
to
land
and
capital
before
discussing
the
output
options
best
suited
to
young
farmers
and
addressing
how
human
factors
influence
the
success
of
new
entrants
to
agriculture.
There
is
currently
a
dearth
of
literature
on
this
topic.
It
is
relatively
easy
to
find
information
on
the
problems
faced
by
new
entrants
and
the
need
for
young
farmers;
it
is
even
relatively
easy
to
find
examples
of
new
entrants
who
are
establishing
their
own
farm
business.
However,
there
is
a
shortage
of
literature
that
coherently
breaks
down
the
issues
and
offers
supported
solutions
(Pigott,
2011),
and
as
such
it
is
hoped
that
this
study
does
just
that.
Data
Presentation
Having
undertaken
the
semi-­‐structured
interviews
and
compiled
a
range
of
case
studies,
it
has
been
necessary
to
categorise
and
retrofit
the
data
into
workable
groups.
Primarily
for
analytical
reasons,
the
data
has
been
collated
into
tables.
The
process
has
enabled
quantitative
comparisons
of
the
case
studies,
with
repeatable
trends
being
identified.
Unfortunately
the
process
resulted
in
the
loss
of
certain
nuances
of
the
data,
and
so
where
appropriate
they
will
be
highlighted
in
the
latter
sections
of
this
study.
That
said,
the
more
direct
analysis
enabled
by
the
grouping
of
the
case
studies
in
this
way,
offsets
the
regrettable
loss
of
some
of
the
data
specifics.
12

13.
For
a
number
of
case
studies
being
involved
in
a
joint
venture
was
fundamental
in
shaping
their
business,
making
this
a
logical
initial
distinction
with
which
to
group
the
data.
Four
case
studies
fell
into
this
category
(Group
2),
and
common
variables
within
this
grouping
have
been
identified.
Although
there
were
a
number
of
other
new
entrants
whose
businesses
contained
aspects
of
‘jointness’,
they
have
remained
in
Group
1
as
it
has
been
held
that
being
involved
in
a
joint
venture
was
not
as
fundamental
in
contributing
towards
their
successful
business
development.
Those
enterprises
left
in
Group
1
have
been
sub-­‐divided
into
2
further
groups.
Almost
all
the
businesses
in
Group
1
had
an
initial
part
time
labour
requirement
but
it
could
be
seen
that
a
number
of
the
enterprises
required
a
lower
time
commitment,
had
a
lower
capital
threshold,
were
generally
less
intensive
in
their
land
use
and
were
less
predisposed
to
offering
a
consistent
cash
flow.
These
businesses
have
been
summarised
in
Group
1(b),
while
the
others
have
remained
in
Group
1(a).
One
significant
anomaly
is
apparent
amongst
the
case
studies.
While
characteristics
of
Charlotte
and
Ben
Hollins’
farm
business
are
comparable
with
case
studies
within
Group
1(a)24,
it
would
mask
anomalous
features
of
their
accomplishments
to
include
them.
However,
aspects
of
their
success
are
undoubtedly
replicable
by
other
new
entrants
and
so
will
be
mentioned
where
appropriate
in
latter
sections.
Nevertheless,
in
being
anomalous
in
relation
to
the
groupings
in
this
study,
they
ultimately
serve
to
reinforce
that
there
is
no
single
best
means
by
which
young
farmers
can
develop
their
own
farm
enterprise.
The
grouped
data
is
presented
overleaf.
24
For
example,
they
have
followed
CSA
principles,
have
utilised
rare
breeds
and
direct
marketing,
and
have
developed
customer
relations
while
employing
extensive
media
coverage
13

14.
Group
Group
1(a)
Group
1(b)
Group
Group
2
(JV’s)
Core
Enterprise
Dairy,
Pigs,
Poultry
or
4/5
sheep
Vegetable
-­‐
higher
Core
3/4
dairy
output/better
cash
flow
Enterprise
First
Generation?
5/6
first
generation
3/5
first
generation
First
2/4/
Generation?
Formal
Agricultural
5/6
formal
agricultural
4/5
formal
agricultural
Formal
All
possessed
qualification
qualification
Qualification
Agricultural
formal
agricultural
Relevant
skills
develop-­‐ Generally
had
practical
Generally
had
practical
Qualification
qualification
ment
prior
to
enterprise
track
record
track
record
Practical
All
developed
significant
establishment
experience
practical
Sourcing
Land
4/6
prior
contacts
to
4/5
prior
contacts
to
experience,
and
Stakeholder
secure
land
secure
land
Relations
all
had
worked
abroad
Landlord
Size
All
smaller
part
of
Mixed,
often
with
land
Development
All
utilised
landlords
larger
spread
across
a
of
JV
relations
networking
portfolio/
estate
number
of
areas.
contacts
-­‐
this
is
very
important.
Under-­‐ 5/6
made
partial
or
Mixed.
Predominantly
Capital
Land
Personal
capital
Principles
of
Utilised
Land
full
use
of
previously
made
use
of
small
is
essential
–
the
land
use
underutilised
land
grazing
blocks
provision
young
farmer
"needs
to
bring
Initial
Land
Small
-­‐
5/6
on
10
acres
2/5
under
10
acres,
something
to
the
or
less
2/5
10-­‐30
acres.
Area
party"
Required
Business
Mixed
-­‐
contract
Structure
farming
Tenure
Rented,
many
short
Rented,
many
short
agreements
are
term
with
little
term
with
little
security
security
of
tenure
of
tenure
favourable,
and
partnerships
to
Sources
of
Start-­‐up
Varied,
but
some
Varied,
but
some
help
develop
Finance
personal
finance
is
key.
personal
finance
is
key.
farming
business
CSA's
and
private
Private
investors
provide
investors
appear
to
be
appear
to
be
a
good
opportunities
to
good
options
option,
plus
bank
loans
leverage
debt
if
needed
against
other
Initial
4/6
commenced
with
2/5
commenced
with
people’s
capital
Applicable
to
New
Entrants
an
enterprise
that
was
an
enterprise
that
was
Enterprise
Business
Enables
below
the
threshold
below
the
threshold
Capital
Principles
of
Finance
Size
economies
of
deemed
to
be
deemed
to
be
Development
scale
to
be
'commercial'
'commercial'
reached
much
Investment
Investment
reflects
Investment
reflects
more
quickly
tenure
security
tenure
security
and
Priorities
(these
4
are
(greater
security
relatively
low
capital
definitely
in
the
enabled
investment
in
threshold
required
to
biggest
5
assets
that
were
'more
enter
the
sheep
enterprises
in
fixed'
in
nature)
industry
this
study)
Cost
Control
Second
hand
Fairly
low
cost
Key
Messages
Network,
find
a
equipment,
DIY,
low
production
systems
good
system,
be
capital
production
knowledgeable,
Cash
Flow
Relatively
consistent
Relatively
seasonal
accumulate
cash
flow
(for
farming
cash
flow
capital
and
a
anyway)
Product
proven
track
Secondary
5/6
initially
had
5/5
initially
had
record,
be
good
secondary
secondary
employment
at
negotiating
Employment
employment
and
have
Rare
Breeds
4/6
made
part
or
full
2/5
made
part
or
full
exceptional
use
of
rare
breeds
use
of
rare
breeds
communicative
Direct
5/6
utilised
direct
3/5
utilised
direct
ability.
Also
be
Output
marketing
marketing
excellent
at
Marketing
Marketing
enthusing
others,
Customer
5/6
heavily
engaged
2/5
heavily
engaged
and
telling
them
Relations
with
developing
with
developing
how
great
your
consumer
relations
consumer
relations
business
idea
is.
Media
4/6
used/benefited
2/5
used/benefited
Personal
from
national
media
from
national
media
Coverage
characteristics
coverage
coverage
(labour)
are
very
Niche
6/6
in
Niches
2/5
(although
other
3
significant
in
producer's
businesses
determining
the
contained
niche
success
of
a
joint
elements)
venture.
14

15.
THE
BLUEPRINT
-­‐
LAND
Agricultural
production
is
inherently
linked
to
land
management.
Even
if
large
tracts
of
land
are
not
required
in
order
to
establish
an
agricultural
enterprise,
some
‘space’
is
still
necessary.
Yet
acquiring
land
is
a
significant
barrier
to
entry
for
new
entrants
(Payne,
2012).
Accordingly,
this
section
will
discuss
possible
solutions
to
some
of
these
challenges.
Principles
of
Land
Use
Applicable
to
New
Entrants
1)
Making
use
of
unwanted
land
“New
entrants
are
using
marginal
land
that
no-­‐one
else
wants
to
farm.”
(Amiss,
2011,
p7)
In
order
to
establish
a
new
farm
enterprise,
young
farmers
may
initially
need
to
make
use
of
land
that
is
currently
under-­‐employed
by
existing
industry
operators.
The
majority
of
the
Group
1(a)
new
entrants
made
use
of
under-­‐utilised
plots25
and
80%
of
Group
1(b)
new
entrants
grew
or
are
growing
their
enterprises
on
relatively
small
parcels
of
often
widely
distributed
land26.
Even
the
most
efficient
farms
are
likely
to
have
a
corner
that
is
under-­‐utilised;
these
are
the
areas
on
which
new
entrants
can
grow
their
businesses,
finding
more
profitable
uses
for
otherwise
unexploited
land
parcels.
Landowners
invariably
embrace
the
additional
revenue
presented
by
utilizing
vacant
plots,
and
established
operators
in
a
given
sector
will
welcome
the
opportunity
to
diversify
income
streams.
There
are
opportunities
for
environmentally
sensitive
farming
in
woodland27
and
many
traditional
farm
buildings
are
incompatible
with
modern
agricultural
machinery
so
consequently
sit
unused28.
While
it
may
seem
counter
intuitive
to
suggest
that
a
new
entrant
who
is
already
at
a
disadvantage
because
of
their
small
size
and
lack
of
capital,
attempt
to
establish
a
business
on
a
sub-­‐optimal
plot
of
land,
it
must
be
remembered
that
there
is
likely
to
be
little
alternative.
Furthermore,
the
proposed
enterprise
needn’t
be
based
on
this
plot
forever;
initially
the
aim
is
25
Ranging
from
unmanaged
areas
of
woodland
to
unused
farm
buildings
26
For
example,
one
new
entrant
is
taking
on
additional
grazing
60
miles
from
his
base,
and
another
estimates
that
in
the
last
5
years
he
has
spent
1100
hours
driving
to
and
from
his
sheep,
in
the
process
covering
a
distance
equivalent
to
twice
the
circumference
of
the
globe!
27
Pigs
and
poultry
are
obvious
examples,
but
there
is
also
scope
for
silvopasture
enterprises
28
Shifting
economic
pressures
and
agricultural
practices
have
resulted
in
many
traditional
farm
buildings
loosing
their
origincal
purpose
(HELM,
2011)
15

16.
simply
to
get
the
business
off
the
ground29.
Once
the
business
model
has
been
shown
to
work,
inevitably
more
opportune
plots
of
land
will
become
available,
and
with
a
proven
track
record
landlords
will
be
more
likely
to
consider
allowing
the
enterprise
to
expand
onto
their
property.
2)
Intensity
of
land
use
“[I]t
is
not
the
acreage
you
farm,
but
the
intensity
of
production
you
maintain,
which
determines
the
financial
success
of
the
venture.”
(Henderson,
1943,
p41)
With
land
being
expensive
and
difficult
for
new
entrants
to
source,
production
from
the
area
obtained
should
be
maximised
in
order
to
minimise
costs.
Traditional
economic
theory
suggests
that
capital
increases
returns
from
land
and
labour,
so
the
difficulty
is
in
establishing
a
system
that
produces
maximal
returns
without
incurring
significant
capital
costs.
The
particular
farming
operation
will
dictate
the
way
in
which
production
is
intensified;
a
number
of
the
Group
1(a)
new
entrants
demonstrated
however,
that
increased
output
could
be
obtained
from
a
relatively
small
plot
through
running
a
variety
of
different
enterprises30.
Alternatively
management-­‐intensive
grazing
techniques
are
potentially
well
suited
to
new
entrants31
and
have
been
successfully
employed
by
all
3
dairy
operations
in
Group
2,
and
also
used
to
varying
extents
by
a
number
of
Group
1
new
entrants.
A
common
criticism
of
management-­‐intensive
production
methods
is
the
labour
requirement
involved
in
their
implementation;
the
high
cost
of
land
however,
means
that
such
techniques
can
most
likely
be
justified
in
order
to
minimise
land
related
costs.
3)
How
much
land
is
really
required?
“‘[H]ow
many
acres?’
or
‘how
many
cows?’
is
largely
irrelevant
as
a
measure
of
success.”
(Amiss,
2011,
p14)
A
number
of
enterprises
included
in
this
study
challenge
perceptions
on
the
amount
of
land
required
to
start
a
farm
business.
Over
60%
of
Group
1
new
entrants
began
their
enterprises
on
10
acres
or
less,
and
fewer
than
20%
started
with
more
than
30
acres.
Some
of
the
29
This
may
require
something
of
a
culture
shift
in
the
UK,
where
it
has
been
commonly
expected
that
farmers
cultivate
the
same
plot
of
land
for
much
of
their
lives.
However,
in
New
Zealand,
it
is
frequently
seen,
particularly
in
the
dairy
industry,
that
a
farmer
may
have
worked
on
and
had
varying
degrees
of
investment
in
multiple
farms
businesses
throughout
their
lifetime
(Shadbolt
and
Martin,
2005)
30
By
way
of
example,
one
case
study
reared
ducks
for
meat
and
eggs,
geese
for
christmas,
had
a
flock
of
70
sheep,
a
herd
of
20
cows,
some
pigs,
and
ran
a
poultry
processing
facility,
all
on
57
acres.
31
New
entrant
dairy
farmers
in
Wisconsin
were
shown
to
be
far
more
likely
to
employ
management
intensive
grazing
techniques
than
their
established
counterparts
(Buttel,
et
al.,
1999;
Barham,
et
al.,
2001)
16