Basic Payment Scheme (BPS) payments will make up a greater proportion of farm income this year than they did in 2018, according to Strutt & Parker.
While telling farmers they can budget for BPS to be worth about the same this year as 12 months ago, based on the system’s 2019 exchange rate being confirmed at €1=£0.89092, the firm’s follow-on calculations highlight the continued importance of the payments to UK farm profitability.
“Farmers look set to receive payments with a value very close to last year’s, which for a lowland farmer in England was around £228/ha after the Financial Discipline Mechanism had been applied,” said Andrew Atkinson (pictured above), senior associate director with Strutt & Parker.
“It is interesting to note, however, that with grain prices significantly lower than in 2018, this means that, even taking this year’s higher yields into account, BPS will make up a greater proportion of farm income than it did last year.
“And it’s a similar situation for beef producers, who have seen their sale values fall significantly over the last few months.
“This highlights its important contribution to farm profitability and emphasises the importance of farms preparing for BPS payments being phased out.”