Agriculture/Case Study Flashcards
(92 cards)
1
Q
Why do we spread nitrogen / phosphate / potash on crops? What does it do?
A
Nitrogen (N): improves overall plant vigor and yield potential
Phosphorus/Phosphate (P): Enhances seed production
Potassium/Potash (K): Improves overall plant health and diseases resistance
Sulphur (S): OSR has a high sulphur requirement, crucial for oil production
2
Q
What price would you expect to pay for a tonne of straw baled in your area?
A
Barley = £90
Wheat = £85
3
Q
What price would you expect to pay for a tonne of barley/wheat/OSR/oats?
A
Malting Barley = £172
Feed Barley = £152
Feed Wheat = £180
Milling Wheat = £204
Bread Wheat = £233
OSR = £385
Milling Oats = £185
4
Q
Why do farmers use crop rotations?
A
- Disrupt pest lifecycles
- Manage disease
- Control weeds
- Prevent soil from becoming deficient in specific nutrients
- Protect soil structure
- Spread risk across farming income
5
Q
Talk me through a crop rotation in your area.
A
Wheat, 2nd wheat, winter barley, OSR
First wheat followed by a second wheat as predominant crop, then winter barley as it is harvested early to allow for early drilling of OSR. First wheat then does well after OSR.
6
Q
Why is oilseed rape used as a break crop?
A
- As a brassica it breaks the life cycle of cereal-specific pests and diseases
- Oilseed rape has a deep taproot therefore it can improve soil structure and reduce compaction
- Use different herbicides to control grass weeds that are problematic in continuous cereal rotations
- Sown early and harvested early allowing for the distribution of labour and machinery at busy harvest and sowing periods
- Spreads risk across farming income
7
Q
Talk me through a typical growing season for a cereal crop
A
- Cultivate the ground i.e. plough or cultivate
- Sow the crop in late August/September
- Roll the field
- Spray pre emergence
- Spray T1 and T2 in spring
- Spread two passes of fertiliser
- Spray T3 and T4 Spring/early Summer
- Spray glyphosate to dessicatec
- Combine in August/September
8
Q
Are there any upcoming changes to legislation for landowners in Scotland?
A
- The Land Reform (Scotland) Bill
- Land holdings over 3000ha (on the mainland) must produce Land Management Plans (LMP) the public can access
- Must engage with the local community on the review of the LMP every 5 years and consider reasonable requests from communities to lease land or buildings;
- Large land holders over 1000 ha will be unable to sell land without obtaining a Lotting Decision first
- If the ministers decide the land must be sold in separate lots, the lots cannot be sold to connected parties
9
Q
When is BPS guaranteed to be in place until?
A
May 2025
10
Q
What scheme is replacing BPS?
A
BPS is being replaced in 2025 by a new system currently called the Agriculture Reform Route Map.
To gain access to agricultural subsidies, farmers must complete a whole farm plan by carrying out two out of the five requirements before 15th May 2025:
- Carbon audit (every 5 years)
- Soil analysis (20% of soil annually)
- Animal health and welfare plan (two things annually)
- Integrated pest management plan (annually)
- Biodiversity audit (every 5 years)
11
Q
Tell me about carbon audits
A
A carbon audit establishes a business’s carbon footprint. It identifies the sources and quantities of greenhouse gas emissions on farms and areas where simple changes can lead to improved efficiency, reduced operating costs and emissions.
The Payment Rate is a standard cost of £500 for an eligible Carbon Audit Claim.
12
Q
Tell me about a biodiversity audit
A
- create a Habitat Map for all land that they are responsible for
- select at least one habitat using the Whole Farm Plan Habitat and Feature Key that best describes the majority of land cover for each field
- provide habitat map details to SGRPID for adding to the LPIS habitat layer
- update the Habitat Map at least once every 5 years
13
Q
Tell me about soil sampling
A
- helps farmers target nutrient applications to where they are needed most, improving efficiency of fertiliser use
- determine the current levels of pH, Phosphate (P), Potash (K), and Carbon in the Soil.
- 4 samples per hectare, 20% of region 1 land annually
14
Q
Tell me about the Animal Health and Welfare Plan
A
Two interventions per year from the below:
- Bull fertility
- Calf respiratory disease
- Cattle: liver fluke
- Cattle: roundworms
- Sheep scab
- Sheep iceberg diseases
- Sheep lameness
- Sheep: liver fluke
- Sheep roundworms
Livestock keepers can claim £500 per annum
15
Q
Tell me about the Integrated Pest Management Plan
A
IPM plans are applicable to any business that uses plant protection products (e.g. pesticides, herbicides, insecticides, nematicides, slug control agents and plant growth regulators).
Free Scottish IPM assessment plan tool available on the Plant Health Centre website.
16
Q
How would I arrange for these to be carried out on my farm? Is there funding?
A
Funding from the Scottish Government to help farmers prepare under the “Prepare for Sustainable Farming” Scheme:
- Carbon audit (£500 grant)
- £30/Ha for region 1 soil sampling with a maximum of £600 grant
- £250 per intervention (for two interventions) within the animal health and welfare plans.
- Free Scottish IPM assessment plan tool available on the Plant Health Centre website.
Most agricultural consultants can conduct a carbon audit, soil testing companies such as SoilEssentials can carry out the soil analysis and most large animal vets can assist with animal health and welfare plans.
17
Q
What do farmers and crofters require to be eligible for BPS?
A
- Be an active farmer
- Hold BPS entitlements.
- Submit a SAF
- Farm a minimum of three hectares of eligible land
- Have this land at their disposal on 15 May of the claim year
- Have one eligible hectare of land for each BPS entitlement
- Comply with greening, Statutory Management Requirements and GAEC’s
18
Q
What are BPS entitlements? How do you get them?
A
Eligible ‘New Entrants’ to farming can apply to the National Reserve for entitlements; other farmers and crofters can obtain entitlements by purchasing, leasing, inheriting them or due to whole holding transfers, business splits or mergers.
Entitlements can be transferred by sale or lease, with or without land to another active farmer.
19
Q
What do you have to do to be classified as an active farmer?
A
Applicants to the Basic Payment Scheme must meet the definition of a ‘farmer’ i.e., be a natural or legal person (or a group of natural or legal persons) whose holding/production units is/are situated within Scotland. They must also exercise an agricultural activity, e.g., the production, rearing or growing of agricultural products including harvesting.
20
Q
What are the 2024 payments for each BPS region?
A
Region 1 = £147.49 + £75.89 = £223.38
Region 2 = £32.52 + £12.86 = £45.38
Region 3 = £9.43 + £4.32 = £13.75
21
Q
What organisations are there to support farmers?
A
- Farm Advisory Service
- Tenant Farming Commissioner – Bob McIntosh CBE
- RSABI
22
Q
Are there restrictions on how much of your land can be farmed?
A
Ecological Focus Areas (EFAs) - businesses with more than 15 hectares of arable land need to ensure that 5% of this land is managed as an EFA.
23
Q
Talk me through your re-instatement claim? What costs were involved? Why were additional sprays used? What were the sprays?
A
- I calculated the time it would take to carry out each operation by considering the size of the field and the job required
- Firstly to pull out shrubs and small trees
- The field was then to be sprayed with glyphosate to kill everything off
- The field was then topped to reduce vegetation
- It was then subsoiled to a depth of 900mm
- It then required to be ploughed
- And power harrowed
- Once there was a level field ready to be drilled, the stones had to be lifted by hand
- The field was then ready to be sown and put into arable production
24
Q
Give me examples of greening/ecological focus areas
A
Fallow Land
Margins
Hedges
Green Cover
Catch Crops
Nitrogen Fixing Crops
Agro-Forestry
25
Tell me about fallow land
- must have been in an arable crop, temporary grass or fallow the year prior
- must be a minimum of 0.01 ha
- 15 January to 15 July inclusive
You are allowed to:
- establish a wild flower / wild bird seed mix
- temporarily store manure
- undertake investigation or replace of field drains in the period 15 January to 15 March
26
Tell me about margins
- must be on, adjacent to, or within five metres of arable land
- can be around the margin of a field or splitting two crops within a field
- must be between one and 20 metres wide
- must be a minimum of 0.01 hectares in size
- 1 January to 31 December, inclusive
- you must control weeds by spot herbicide and hand roguing
You must NOT:
- clean ditches and spread the spoil the area
- graze the margin if it contains or is adjacent to a watercourse
- store materials
- use for regular access
27
Tell me about hedges
* any hedge having a length of at least 20 metres
* must be on or within five metres of arable land
* longest edge of the hedge is parallel to the field
* must adjacent to a claimed parcel that is BPS eligible and claimed on your SAF
* can be any height but can only be up to and including three metres wide from the centre of the hedge
You must not:
* remove or destroy hedges without the written consent of the Scottish Ministers
* trim hedges or lop branches off trees during the bird nesting and rearing season starting on 1 March and ending on 31 August except for road safety reasons.
* cultivate land within two metres of the centre line of a hedge unless one of the following exemptions apply:
- cultivating to establish a green cover where one doesn’t already exist. A green cover excludes crops that are grown for a commercial purpose, e.g. arable crops including crops that are under sown with grass
- cultivating to establish a new hedge
* apply fertilisers (organic manure, chemical or nitrogen) or pesticides within two metres of the centre line
28
What is a cover crop?
A crop grown to enhance / protect the soil rather than to be harvested for profit
29
Give some examples of cover crops?
Legumes, Mustards, phacelia, chicory, linseed
30
What are the methods of destruction of cover crops?
Spraying off, ripping up, frost, grazing
31
Tell me about AECS schemes?
- Run for a 5 year period
- You are paid management payments each year and capital payments for each works that you carry out
- Capital payments are for activities such as planting hedges,
- Run by a point based system
32
Talk me through completing a SAF application.
1. Log onto Rural Payments website
2. Select relevant clients business
3. Go to applications
4. Choose which scheme you are doing (SAF)
5. Select info/options relevant to the scheme
6. Check entitlements against number you have
7. Land declaration - what is in each field
8. Check greening requirements are met
9. Input livestock numbers
10. Upload EFA maps
11. Submit
33
What is club root? How is it identified? What does it do to the crop?
A soil borne disease that effects brassica crops such as OSR
Pull the crop out of the ground and check the tap routes, if they are short and stunted it may have club root
Affects roots in the form of nutrient water uptake which in turn negatively impacts the yield
34
What yield would you expect from OSR? When do you harvest it?
4t/Ha = 1.8t/Ac
Harvested in late July/early August
35
When do you sow OSR? And at what rate?
Sow in late July/early August
2.7-3kg/Ha
36
Why do you recommend this rotation to get rid of club root?
Want to have a 5 year rotational break between brassica crops to try and eliminate club root in the soil
Wheat generally does well after rape, oats in to alleviate concerns of take all, wheat in again for another first wheat and then winter barley as it is ready early to allow for OSR to go back in.
37
How do I test my soil? What companies can I use? Is there funding?
Contact a company such as Soil Essentials or SOYL who can come out to your farm and take soil samples, generally around 4 samples per hectare to review pH levels, soil status, nutrients, pests and diseases.
Best practice is to test 20% of your Region 1 land annually. Applicants can claim for funding once a year, for up to £30.00 per hectare.
38
How much milk does a typical Holstein Friesian produce per year?
10 000 litres
39
What price would you expect to get for a litre of milk?
37p
40
What is contract farming?
Where a farmer instructs a contractor to undertake the practical operations and management of a crop or other enterprise within the farmer's stated policies and for the farmer's business.
41
What headings would you expect to see in a contract farming agreement?
- Farmer
- Contractor
- Commencement Date
- Term
- Acres of land
- Insurance
- Contractor obligations
- Contractors first charge
- Farmers basic fee
- Divisible surplus
- Accounting
- VAT
- Meetings
- BPS
- Termination
- Dispute resolution
42
What are the advantages and disadvantages of contract farming?
Advantages
- Active farmer status for the landowner (remain in control)
- Qualify for APR for IHT
- Don’t have to purchase machinery or employ staff
- Claim subsidies
- Farmers divisible
- Freedom of Contract for CFA
Disadvantages
o Working capital requirement
o Risk of making a loss
o Effected by external issues such as weather
o May need an agent/professional to manage
o Risk of markets
43
How do you produce the CFA annual accounts? What is included? Talk me through your calculations.
Produce a nominal ledger of No2 account from October the year the crop is being sown to Q2 the year the crop has been harvested, assuming the grain and straw has been sold by this point.
I then input each of the invoices under income, fixed costs and variable costs, relevant to the month the transaction was made.
Once I have calculated the income produced from the straw and grain sold, I deduct the variable costs such as seed, fertiliser and sprays. This gives me the gross margin.
I then deduct fixed costs such as insurance and pest control to give me the first surplus. This is where I would factor in the contractors fixed charge and the farmers basic payment.
Any surplus thereafter is divided between the contractor and the farmer as agreed in the contract farming agreement.
44
Why have input costs fluctuated so much?
Fertiliser costs fluctuated greatly in the aftermath of Russia’s invasion of Ukraine. Due to export restrictions on Russia and general supply chain disruptions, fertiliser prices shot up in 2022. However, supply chains have settled and domestic production has rebounded in the aftermath of a large fertiliser plant in Cheshire closing.
Diesel and labour costs have also seen increased volatility. Diesel prices also increased during the initial phase of the export restrictions on Russia. Labour costs have increased due to a shortage of European workers coming into the UK due to Brexit and visa changes.
45
Did you consider growing beans/peas/potatoes at Shawfair?
It is something we have discussed however the contractor does not have the correct equipment to harvest beans/peas/potatoes and was not interested in investing/hiring this equipment.
46
Would Shawfair LLP be required to have Ecological Focus Areas?
Yes, as they farm over 15 hectares of arable land, at least 5% of their holding should be in EFA’s. However Shawfair LLP does not claim subsidies.
47
Could you claim BPS with leaving the land in fallow?
Technically yes we could, however I would not advise my client to claim anything as if they were investigated/asked for proof they would not be able to prove they are actively farming the land
48
Explain the principles of a Sale of Standing Crop Agreement?
- Farmer purchases the inputs (seed, sprays, fertiliser)
- Farmer employs a contractor to carry out each of the field operations, i.e. ploughing, sowing, rolling, spreading fertiliser, spraying
- Contractor has right of first refusal to purchase the standing crop just before harvest.
- Crop is sold on a per acre price, factoring in markets prices and costs to grow the crop
49
What are the Contractor’s responsibilities and what are the Farmer’s responsibilities in a CFA?
**Contractor Responsibilities**
To grow the crops to the best of their ability
To work with the farmer to reach the farmer’s objectives for the land
To communicate to the farmer any issues on the ground or with the agreement
**Farmer’s Responsibilities **
To provide the working capital
To manage the accounts
To provide the land
To foot the losses when there are losses
50
What fee would you expect a contractor to be paid? And how much would you expect the farmer to be paid?
Farmer £75/acre (185/Ha)
Contractor £150/acre (£379/Ha)
51
Talk me through a gross margin for an arable crop?
Winter Wheat
Grain = 4t/ac at £185 per tonne (feed)
Straw = 1.7t/ac at £70 per tonne (in bout)
Income = £859
Seed = £50 (93kg/ac)
Fertiliser = £135 (20:10:10)
Sprays = £79 (pre em, T1, T2, T3 + T4, round up)
Outputs = £259
GM = £563
52
What happens to BPS under a Sale of Standing Crop Agreement?
The Farmer claims it
Not relevant for Shawfair as no BPS
53
What would you advise your client to do with a grain store that is no longer required at Shawfair?
In the past it was let to a vintage bus company who removed their buses during harvest. I have contacted them to see if they would be interested in coming back to use the space and we are currently in discussions
54
Why did you not recommend putting the land into grazing licenses at Shawfair?
Fields aren’t fenced so it would be an extensive capital payment to put these in
Land is too good quality
55
Why did you not recommend putting the land into grazing licenses at Shawfair?
Fields aren’t fenced so it would be an extensive capital payment to put these in
Land is too good quality
56
Tell me about a Limited Liability Partnership?
- incorporated at Companies House
- minimum of two individuals / companies
- cant sell shares
- allow for a partnership structure where each partner’s liabilities are limited to the amount they put into the business.
- spreading risk, leveraging individual skills and expertise, and establishing a division of labor.
- Limited liability means that if the partnership fails, then creditors cannot go after a partner’s personal assets or income.
57
What are the advantages and disadvantages of an LLP?
Advantages
Protection of personal assets via limited liability
Flexibility in terms of management and how profits are shared
Members can be companies as well as individuals
The partnership can enter into contracts in its own name
Disadvantages
The partnership’s accounts and financial position are available for public view
It can be costlier to set up an LLP when compared with a traditional partnership
The administrative costs are generally higher than a ‘standard’ partnership due to additional accounting and filing requirements
58
How else could you calculate the price for the standing crop?
Considering the going rate by looking at the standing crop market
59
What are the key differences between an LLP and an LTD?
Structure - LLP's have greater flexibility as to how they share profits, remove capital, their management structure, how decisions are made, and the way in which members are appointed and retire
Confidentiality - LLP Members’ Agreement is private, can keep P+L accounts private etc
Tax - Ltd pays corporation tax whereas LLP members pay income tax on profits and from sale of assets
Investment - can't invest in an LLP the same as Ltd as no shares as such
60
How did you bring the CFA to an end? What was the notice period?
The notice period was two weeks, we agreed the end of the CFA verbally but issued formal written notices to be signed by each party
61
Can you talk me through the fertiliser requirements and timing of applications for OSR?
NPK + S
Two passes in the Spring
200 : 49 : 38 + 75
62
What crop was grown on the West Lothian contract farming agreement? What was the yield per acre? What price was achieved per tonne? For grain and for straw?
Winter wheat
4t/acre
£210 for grain
£50/t baled
63
What time of year would you harvest a crop of spring barley?
September
64
Can you please explain some of the recent market trends of agriculture in Scotland?
Various geo-political factors such as Brexit and the Ukraine war have had a huge impact on prices and policy in Scotland.
Fertiliser and grain prices rocketed after Russia invaded Ukraine in February 2022 however have come back down to a more typical level.
However concerns over escalations in the region do have an impact on fluctuation of the grain prices over concerns the black sea grain will stop being imported.
65
Are you able to give advice on agronomy?
No, I am not qualified to advise on agronomy.
66
In your rotation, you have advised that they crop with winter oats, why?
WO is a break crop from wheat/barley as it is a lot less nutrient hungry therefore gives the soil a break from more nutrient hungry crops such as barley and wheat.
67
Why did you not consider introducing grass into your advised rotation?
No livestock on the holding therefore did not really have a use for a grass field
68
Talk me through a typical contract farming agreement.
There are two parties, a contractor and a farmer.
The farmer is the landowner and the contractor is the agricultural operator on the ground carrying out the field works to cultivate and grow the crop
The farmer provides the working capital and sets up a separate account to be used only for the purchase and sale of commodities related to the agricultural operations
The farmer and contractor meet regularly to discuss what crops are to be sown, when and where, any issues on the ground with drainage or access and so on
The farmer instructs the contractor to carry out the field works required
The contractor is paid a "first charge" on a per acre/hectare basis
The farmer is paid a "basic payment" on a per acre/hectare basis
Any divisible surplus of profit after these payments are made are divvied up between the two parties, generally weighted towards the contractor as an incentive
69
Why would you recommend a contract farming agreement over letting the ground on an agricultural lease?
Retain active farmer status
Claim BPS
Retain vacant possession so can use the land for something else
In control of the land
IHT?
70
You state that one of your clients aims was to retain vacant possession, what do you understand by this term?
Are you achieving vacant possession by having the land contract farmed?
An agricultural holding with no agricultural tenancy in place.
Yes
71
Would the capital value of the land change if it was managed under a contract farm agreement rather than say an agricultural lease?
Yes the capital value would decrease if the land was let on a fixed duration tenancy as the land would be valued with a tenant in situe. The purchaser would have to purchase the land with the tenant and would not have VP until the end of the term which would in turn decrease the value
72
What do you understand by Agricultural Property Relief?
Was this a consideration when advising your client?
APR is a relief from IHT for ag property. IHT is 40% of your estate over £325,000
no as they are a company and not subject to IHT
73
I notice from your budget that in 2023, there was a 50/50 split with the contractor, is this typical in your view?
It can be however I would generally expect the contractor to be paid slightly more, maybe 60/40 or even higher
74
What is a more expensive crop to grow, SB or WW?
Winter wheat - more seed, sprays and fertiliser required
75
How did you calculate your standing crop price?
Costs + inputs + profit dependent on market
76
How did you calculate your profit payment for the SSCA?
worked out profits from the agreement and then split 75/25 to contractor and divided on a per hectare basis
77
What do you need to grow and sell oats?
LEAF certification and a contract
78
Why did the CFA make a loss in 2022? This was regarded to be one of the best farming years
Fertiliser was purchased for 2022 + 2023 at probably the most expensive point as there was concerns the price would increase, and grain was sold at quite a low price as they had held out to see if price would increase
79
What date did the latest edition of "Surveying Safely" come into force?
Feb 2019
80
£195 for spring barley is a lot - is this malting?
Yes, was grown for malting
Used laureate variety
Contractor / agronomist confident it would go for malting as nitrogen went on at the optimum time
80
Why did the CFA make a loss in 2023?
- SB grain sold in July 23 when price was very low for approx. £155/t
- 4Ha lost to development
- Yielded 4.75t/Ha
81
What causes clubroot? What can be done to prevent it?
Clubroot is a soil borne pathogen
Spreading lime on stubble before sowing a brassica such as OSR can help to prevent clubroot as it increases the pH
82
What is a PF23 form?
Used for transferring BPS entitlements?
83
Why did you not consider a stubble to stubble agreement?
Not commonly used in Scotland, not an official agreement up here as far as I am aware
84
What rate would you sow:
- winter barley
- spring barley
- OSR
- wheat
- winter oats
- 220kg/ha
- 190kg/ha
- 4kg/ha
- 230kg/ha
- 190kg/ha
85
How much nitrogen would you expect to apply to winter wheat?
230kg/ha
86
Tell me about the safe storage of fertiliser?
Make sure you have a distance of at least 5 meters between the materials
HSE and fire service must be notified if 25 tonnes of AN fertiliser with a nitrogen content of 28%
Also if 150 tonnes or more of any type of fertiliser are stored on a site
87
Name a variety of OSR
Ergo
Resort
88
Name a variety of Winter Wheat
LG skyscraper
Saki
89
Name a variety of Winter Barley
LG Caravelle
Funky
90
Name a variety of Spring Barley
Laureate
Golden Promise
91
What is the definition of a New Entrant?
A new entrant is someone who does not hold, or have a controlling interest in an existing agricultural tenancy and who is not a smallholder, crofter or the owner of more than three hectares of agricultural land
