For those involved in buying land this year extreme caution is needed to ensure both the vendor and purchaser understand the situation in respect to the BPS. To claim for this year and therefore to retain any entitlements registered in one’s name, one must have had the appropriate amount of land at one’s disposal for Friday 15th May, this week. Whilst the deadline for submitting the BP5 and transferring entitlements has been pushed back to the 15th June, the 15th May deadline otherwise remains. That gives us four weeks with a considerable amount of work still needed, for most not helped by now having to revert to paper submissions. If this is of a particular problem we, amongst others, can now offer once again, online submissions of BP5 claim forms, the RPA giving us access to the “back of office” software. This would be of particular use to those that wish to avoid errors. This has particular relevance when checking crop diversification and Ecological Focus Area calculations.
Historically in the first year of any new scheme quota values tend to be at their lowest and this has proved to be the case again with Non-SDA entitlements having recently hit in a few cases a low of a third of last year’s average price. The market however is steadily becoming busier and we are expecting heavy trading in the last four weeks and we are sure that our trading to the deadline will be as popular as always. With prices at the time of writing ranging from £60-95/ha for Non-SDA depending on lot size and VAT. Ironically SDA is more expensive at £140/ha. If you have land then this is the year to buy entitlements.
Pressure is also on for the 15th June for new and young farmers to sort things out in order to make their claims for additional entitlements and top-up payments of up to 25% of the average value up to 90 hectares of entitlements. This is an important consideration if buying more land this spring for any family business.
Another consideration for purchasers of land with existing renewable incomes, this spring has seen the emerging of new opportunities to capitalise on the income received over the period of renewable leases. City fund managers looking for long term income security can see rental income from land leased to solar, biomass, wind or other large scale developers as attractive investments. By capitalising now landowners could use the lump sum obtained for reinvestment on the farm to invest in additional land or fixed equipment, or to pay off existing debt liabilities.
