Land Tussle – Net Zero – Ecosystem Markets – National Grid – Farm to Fork – Triathlons
Newsletter #4
Origin Rural is a consultancy with the rural sector at its heart.
Through first-hand experience, we provide owners and managers of land and property with high quality support from the ground up.
Confessions
My last newsletter focussed on resilience and business strategies to cope with change. There is now a real sense of land tussling amidst the clamour for rural market share driven by politics, the economy and emerging markets.
We have seen a relatively slow build up following ‘transformative’ legislation effecting land management, primarily the Agriculture Act (2020) and the Environment Act (2021). But now the wheels are truly in motion. On reflection, 2022 was extraordinary. In agriculture, grain prices doubled and input costs inflated to historic highs. Society more broadly was rocked by political turmoil (Three Prime Ministers!), war in mainland Europe and the onset of recession to name but a few. As 2023 ushers in a period of relative stability, we are facing forwards again and the rural sector sits at the heart of competing agendas.
Net Zero remains front and centre, with recent WMO reports indicating that targeted restriction of global warming to 1.5°C from ‘pre industrial’ levels looks very unlikely. The frequency of extreme weather in the UK alone is a stark reminder that the crisis needs tackling hard. That said, there is a sense in farming that mindsets are changing; not just business decisions to invest in new markets and spread risk, but a collective recognition that nature based solutions hold huge potential to make a difference.
Ecosystem service markets have been subject to a new UK Government Strategy to support the scale up of high integrity nature markets across the UK, with investment standards and baselining at the core. Tellingly, the report indicates that total carbon sequestration validated under the two existing ‘standards’, i.e. the Woodland Carbon Code and Peatland Code is c.1.5m tonnes - amounting to 0.3% of the UK’s current annual emissions. Encouragingly, the British Standards Institution (BSI) has been commissioned to expedite standards for nature markets, and baseline metrics are already evolving in the field. This comes at a time when businesses are bombarded with ‘intelligence’ around natural capital and live projects are emerging, particularly in nutrient neutrality hot spots and via Biodiversity Net Gain (BNG) interventions. Layered on publicly available environmental finance under ELMS and a raft of DEFRA funds, the cross-sector challenge at this critical time is to get it right.
Aside from the climate crisis (albeit inextricably linked), land-use for housing, food security, and energy production are all keenly competing for a seat at the table. The Food to Fork Conference at Downing Street and roll out of local authority led Local Nature Recovery Strategies (LNRS) underpinning development plans exemplify this. We are also seeing the side effects of rapid market change feed down to farm scale. Development of battery storage and solar schemes, for example, breath new life into businesses. However, National Grid capacity constraints and consultation over electricity legislative reform continue to frustrate renewable energy projects.
Building on the (positively received) notion of Kinetic Agriculture, businesses are busily adapting to a post subsidy world; an era of price and now supply volatility, against a backdrop of increasing regulatory burden on asset management and market proliferation. I think 2023 marks the tide turning in the industry and it is exciting to be involved.
Highlights
⚡Renewable energy projects worth billions stuck on hold – Billions of pounds' worth of green energy projects are on hold because they cannot plug into the UK's electricity system, BBC research shows.
🍴 An update following the UK Farm to Fork summit held at 10 Downing Street on 16 May 2023 - The Prime Minister and DEFRA Secretary met representatives from across the whole UK supply chain, from farm to fork, for a Summit on how government and industry can work together to support a thriving UK food industry.
🐄 Delinked payments guidance updates - The Rural Payments Agency (RPA) has published updates to the guidance for delinked payments.
💹 World likely to breach 1.5 degrees Celsius limit. What does this mean for mankind? - In a new report, the World Meteorological Organisation said there was a 66 per cent chance that global temperatures would breach the crucial 1.5 degrees Celsius-mark in the next five years. El Nino and human activities are the likely reasons for pushing the mercury levels into ‘uncharted territory’.
🌳Nature Recovery Network - The West of England Nature Partnership is working to develop a regional Nature Recovery Network for the West of England, aligning with shared principles developed across the South West (by the South West Local Nature Partnerships) to ensure coherence and strengthened networks across the wider region.
🏠Renters (Reform) Bill: behind the headlines - The headline everywhere is that section 21 “no-fault” evictions will be banned in a reform of the private rented sector. It is certainly attention grabbing – both for tenants and landlords.
Update from the farm
Despite my best efforts, the annual Basic Payment Scheme deadline went down to the wire. Albeit the final year before delinked payments are automated to farmers, there was no nostalgic sentiment towards the process and endless decimal places. To ensure balance, I was seconded to silage making on the farm and another favourite task; ‘sheeting down’. We managed to compile a crack squad and all went well for the first cut in early May. This is a critical time and really drives the herd performance for the next year - our nutritionist gets very excited about testing the produce and analysis of metabolizable energy, amongst other fun stats. The next 18-months are going to be challenging as milk prices have dropped rapidly and while certain inputs have followed suit, the overhead cost base remains high relative to ‘pre-Ukraine’ levels.
Since that time, we have had hot dry weather and the opposite to the preceding eight weeks. Farms look their best in June and the countryside on the whole is incredibly diverse at this time. I have noticed this summer more than most how vital hedgerows and field margins are for wildlife. The abundance of life scurrying around ‘on the fringes’ is remarkable and I would encourage everyone to review their ability to do more for nature.
I have been persuaded to enter another long-ish triathlon in September, with early mornings spent outdoors training as part of my routine. Watching the sunrise from behind the wheel and swimming in the outdoors transforms the day ahead, and I cannot recommend it highly enough. The flip side is that come September, the sun will probably be setting by the time I cross the line, having been served some lycra clad punishment!
Best wishes,
Chris
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Chris Jones
Owner / Origin Rural
originrural.co.uk
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Origin Rural is a consultancy with the rural sector at its heart.
Through first-hand experience, our independent professional services provide owners and managers of land and property with high quality support from the ground up.
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