In the context of a crisis of confidence in British agriculture, the NFU convened banking and lending institutions for a broad discussion, chaired by NFU Deputy President David Exwood, about the role they can play in supporting farming businesses.
NFU Director of Policy Andrew Clark updated representatives from HSBC, NatWest, Barclays, Virgin Money, Oxbury Bank, Lloyds Banking Group and UK Finance on the NFU’s policy work in relation to supporting farm business resilience and underlined the importance of banking institutions working with the agricultural sector to facilitate growth.
“With forward-thinking policies from bank lenders we can continue to innovate and develop new technologies which can help us achieve our goals."
NFU Deputy President David Exwood
Farmer Confidence Survey
Taking place shortly after the release of the latest Farmer Confidence Survey results that captured a worrying collapse in farm business confidence, NFU Senior Economist Sanjay Dhanda outlined what this might mean for future production levels.
This survey of almost 800 member businesses scanned horizons across all major UK farming sectors and saw short-term (one-year outlook) and mid-term (three-year outlook) confidence fall to the lowest levels since the inception of the survey.
Crucially, survey results illustrate that confidence in future banking support has likewise decreased and is also at the lowest level since surveying began. Attendees examined the driving forces behind this decline and how banking institutions can work with farming businesses to reverse this trend.
Future of ESG requirements
As part of this discussion, banking representatives provided their insights into the future of ESG (Environmental, Social and Governance) requirements for lending and their expectations of borrowers.
Reflecting on these conversations, NFU Deputy President David Exwood said: “With farmer confidence at an all-time low, this roundtable has come at a really critical time.
“A core part of this meeting was to help the banks understand the pressures farmers and growers are under from relentless wet weather, unsustainably high production costs, and challenging supply chains and further reductions in BPS support, all putting a huge strain on cashflow, and how their continued support through lending is especially important right now.
“But we’re not just looking at support in the short term. The NFU’s general election manifesto outlines that, as a sector, we have ambitions to boost our business resilience, grow our economic contribution and deliver more for the environment, and investment in agricultural technology is a big part of this.
“We are already a global leader in this area, and with forward-thinking policies from bank lenders we can continue to innovate and develop new technologies which can help us achieve our goals.
“It’s been great to see the banks so receptive and we’ll be following up with them individually to discuss their policies in more detail.”
The NFU will now be attending follow up meetings with individual banks to provide members with a better understanding of each individual banks ESG policy and how this may impact future borrowing.
This information and guidance will be published shortly.
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Our general election manifesto – Farming for Britain's Future – outlines our key asks of the next government to ensure farmers and growers can continue to deliver for the environment, economy and local communities while producing more of the great British food we all enjoy.