Category: Updates

How farmers can prosper from diversifying

18th March 2019

Many farmers are responding to rising energy costs, lower food prices and the huge Brexit question mark with a broad range of enterprising diversification ventures. Julie Liddle runs the rule over some of them.

Diversification is no long a nice-to-have sideline, but rather a crucial element of modern agri-businesses.

Recent government figures suggest 62 per cent of UK farmers now have no choice but to diversify into other enterprises at the same time as operating a traditional working farm. As a result, more than half of England’s 57,000 farms have diversified in some way, according to statistics issued by Defra at the end of January.

Tourism, leisure and hospitality

Glamping is increasingly popular among people who want a taste of the great outdoors without ‘roughing it’ on a traditional camping site. Rather than sleeping in tents and cooking outside, glampers have comfortable beds, quality cooking facilities and hot water on tap.

Glamping represents a lucrative opportunity for farm diversification, although it must be done well to be successful and planning consent is crucial. Local and neighbourhood development plans will affect your proposals, so it is important to engage with the local planning authority after taking professional advice first.

Latest figures show that less than one in three couples now choose a church or religious building for their wedding ceremony, which is good news for alternative venues.

The UK wedding market is a £10 billion industry, and farm weddings can offer stylish and romantic options, with couples able to choose a restored livestock barn, or a historic farmhouse for the ceremony. Converted barns are especially popular for their rustic charm and are an ideal party venue for the evening entertainment.

Pet projects can be profitable

Converting outbuildings to kennels and catteries is a great way to generate significant extra income.

If you have a background with animals – as most farmers do – so much the better. Spacious accommodation is always sought-after among pet owners who are prepared to pay top dollar to ensure their furry friends are happy and secure in their ‘home from home’.

The market is substantial, with £4.6 billion spent on pets and related pet products in the UK in 2017 –up from £2.55bn in 2005. Again, planning is critical though, as in addition to new builds, a change of use of existing buildings may be needed.

Farming enables a more caring society

The concept of ‘Care Farming’ involves the use of land and space to help vulnerable individuals to recover.

Around 250 care farms are currently operating in the UK, with a further 100 in the pipeline. They involve farms welcoming people such as troubled teenagers, rehabilitated offenders and patients with dementia. Service users benefit from structure and stimulation in their everyday lives, and activities include everything from therapeutic contact with livestock to horticultural and environmental classes.

Rural crafts, arts and products

Many farms and rural businesses diversify into teaching heritage skills such as traditional spinning and weaving.

Some farms combine livestock with craftwork, such as sheep and alpaca farms running ’fleece to felt’ or spinning workshops where guests are able to meet the sheep or alpaca, then turn the wool into fabrics.

Local food provenance and sourcing the freshest ingredients possible has a natural fit with farming, which means hosting a cookery school on your farm could be an ideal way to monetise your produce.

Recent reality TV shows, for example the Great British Menu, have emphasised the importance to our food supply of Britain’s farmers, while underscoring the public’s interest in the origins of their food.

Brewing and distilling

The UK’s craft beer sector is continuing to grow, with the number of microbreweries rising from 1,218 in 2012 to more than 2,000 in 2018. To meet this demand, the UK hop area has also grown, up eight per cent in 2016 to 942 hectares and another four per cent in 2017 to 980ha.

With just over 50 hop farmers in the UK at present, the British Hop Association says anyone looking to grow hops would need to plant a minimum of 10ha to make it a worthwhile enterprise.

Many farmers are diversifying into the fast-growing spirits distilling market, where being able to say you have nurtured the product from ‘grain to glass’ represents a strong competitive advantage.

For many years distilling was dominated by global businesses, but spirit manufacturing was revolutionised in 2009 when a campaign overturned a ban on small-scale distillation licences.

Energy and environmental ventures

Most renewable technologies still attract government subsidies, and energy security at a time of rising prices, could be a sound investment. Various schemes can help you benefit from the land and environment around your farm by helping to preserve it.

Another area of diversification is using forestry to providing fuel for biomass heating systems and multi-fuel households. Generous government grant schemes for felling and replanting give woodland owners an opportunity to make solid returns on their assets and bring woodland back into productivity.

If you farm is not producing a sustainable return through farming – especially post subsidies – a non-farming scheme to Brexit proof your business could be worth considering.