Amidst the unprecedented events of the COVID-19 pandemic, Brian Richardson, UK head of Agriculture for Yorkshire and Clydesdale Bank, owned by Virgin Money UK, shares why farmers should be heralded during these difficult times.
With livestock and growing crops to deal with, and a nation which still needs feeding, I believe that the value of UKproduce and the admirable work of our British farmers has certainly come more to the fore. I have been very pleased to see that this has been at least one positive side effect of the bleakness of COVID-19.
As an essential service, used to dealing with the unforeseen, farming has tackled this crisis head on. The industry is having to think on its feet to overcome any negative impacts, which will continue beyond the COVID-19 crisis.
Throughout, I have seen the agri-industry rise to the challenge that the pandemic has presented and truly demonstrate its resilience and robust nature. However, with these changes comes a certain level of anxiety about adapting and sustaining services, as well as income.
As a result, we at the Bank, are very much focused on supporting our farming customers with practical and crucial financial support through the coronavirus. Understandably, requests are coming in daily for adjustments to current lending arrangements to ease the burden. In addition, it has been a relief to be able to provide extra support and a financial cushion at this time through the recently launched Bounce Back Loans and the Government’s Coronavirus Business Interruption Loans. The latter provides financial support up to £5 million to SMEs and is specifically for customers that are losing revenue and seeing their cashflow disrupted as a result of the COVID-19 outbreak.
In recent weeks the farming industry has been in a state of flux. As supply, demand and specifications have changed rapidly, farmers and the food industry have adapted at speed, but this has not been without its challenges. This has caused shifts in market pricing, some of which have been very negative. For example, we despaired as we watched dairy producers on the news throwing milk down the drain, but thankfully this was short lived. although there is still a lot of challenge in the dairy sector. In fact, the market for around 20% of supplies that would normally go into food service (restaurants, fast food outlets, coffee shops schools etc) literally disappeared overnight. Increased demand through supermarkets compensated for some losses, but it still disrupted the supply chain and, for some, had a significant effect on the price they were receiving.
Dairies have been working hard to deal with these changes and the Government has now provided some additional direct support for those farmers who have been particularly hit by these circumstances.
Consequently, there is inevitably some nervousness in the industry on how to sustain livelihoods. Farming is a very long-term business, with the marketing of products running through the seasons, so some of the impacts of this pandemic, such as where premiums are lost or marketing has to be delayed, are yet to be felt. Some businesses have lost sales at their peak trading time – a challenge for any business. Others had diversified into businesses, such as farm cafés and tourism, that have been forced to temporarily close. Despite this, Brian feels confident about the future for a sector that evidence shows has more than risen to the challenge,”
When I talk each week to many of our customers and their trade organisations, I am always impressed by the resilience of the sector. Farmers’ adaptability and innovative thinking takes place on a daily basis and I am glad that the nation has now witnessed this first-hand, with perhaps a new level of acknowledgment for what farmers do to produce the high quality food we all enjoy, at fantastic value for money. We will, as we have always done, continue to support this vitally important sector throughout the COVID-19 pandemic and beyond to ensure the supply chain thrives.
With decades of experience of working in the agricultural sector, I know that it has never been more important than now to react quickly to changes in the markets. As a bank with a long heritage in this industry, our specialist team of agricultural business managers are on hand to talk through individual requirements with their farming and rural customers and provide the necessary advice to help them mitigate current and future impacts”.
Yorkshire and Clydesdale Bank has a long heritage of service to customers and their communities and there has been a significant effort to maintain this in these challenging times. Over many years it has worked hard to establish a team of specialist regional agricultural managers with an in-depth knowledge of the sector. The close relations this team has with customers are proving to be invaluable in supporting their network of UK farming businesses.