The Euro Exchange Rate for BPS 2018 payments has been confirmed by the RPA as €1 = £0.89281, this compares to the rate set last year for BPS 2017 which was €1 = £0.89470.
The 2018 rate set shows a small decrease on the 2017 position of -0.21%. The 2018 rate is the second most favourable since 2009, when it topped 90p per euro.
Based on the 2017 BPS fund being worth £1.762bn at a rate €1 = £0.89470, this less favourable exchange rate now is likely mean the 2018 BPS fund will fall by around £4m in sterling terms, this fall in funds has been restricted as a result of using the average exchange rates for September as opposed to the spot rate set for the last day in September (28th); if that rate had been used the fall would have been c£14m.
Is this all good news for farmers?
This is a favourable exchange rate when you look back at previous rates, but after a year the industry has endured significant impact from the wet and drought weather conditions, this monies will be needed more than ever.
Key is certainty of payment timing and the NFU continues to monitor RPA claim processing performance closely and is seeking earlier bridging payments for those not paid in December 2018.