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PrimeGlobal member firm Thomas Westcott discusses the impact of the Coronavirus on the Agricultural Sector. 

The coronavirus is posing unprecedented challenges to people from all walks of life so we are very concerned for our agricultural clients. However, we must remember that farming has survived many crises through the years and has continued to provide food and a wonderful rural environment. 

Here are several points for farming clients to consider and act on.

Considerations for farmers

• Most farming businesses have a clear route to market, which is continuing for the moment.

• Milk tankers are still collecting from dairy farms, but check your insurance policy so you know where you stand should the milk not be picked up.

• Livestock markets are trading but attendance is likely to be much lower than usual, which will have an impact on sales. Those selling stock through the markets should therefore consider alternatives, such as keeping the animals themselves out on grassland, or selling direct to finishers or even trying to find local outlets or meat boxes.

• May need to seek additional funding as more animals remain on the farm. Speak to your bank about this now - do not leave it too late.

• Abattoirs are still open for business.

• Many farmers work alone or with immediate family members so the call for us to reduce social contact may mean less change to daily life for you than most other people. However, with farms now preparing for the very busy spring season, please take great care to ensure your staff and your families are following the latest advice, particularly where there are vulnerable people involved.

• Access to workers will be very interrupted and certainly migrant workers were not coming into the country in the numbers farming has been used to. This however was happening pre virus and many had worked on their labour plans.

• With lambing season and crop growing / harvesting just coming into the picture this will make getting jobs done more difficult. Try to plan work to ensure the most essential jobs are prioritised.

• Farms that have come to rely on diversification and parallel business activity may face additional challenges. If ventures such as holiday lets have propped up the farming businesses and budget, there is likely to be an impact on cashflow. Talk to your business advisors as soon as possible about how to best manage this.

• Do not forget it is Basic Payment Scheme time of year. Get in touch with your advisor now to ensure there is a safe way of filling in the form with as little personal contact as possible.

• Routine farm visits by many professionals are being stopped for now or at least scaled right back, but much of this communication can carry on through email, Skype or telephone. Make use of the technology you have to ensure you continue to get the advice you need.

 A positive message for farmers during the coronavirus pandemic

• This virus should remind us of the importance of our food security. Once it has passed, I believe the safety and provenance of our food here in the UK will be seen as more important than ever. The farming community are the people we can trust to ensure that is the case.

• Farming is generally well-structured and often with a high value in property assets , which makes it more resilient than many businesses. This will give more flexibility to farmers who need to adapt now or in the future.

• Farm incomes will not decline as quickly as many other sectors. 

 Key actions for farmers to take now

Whatever the nature of your farm or agricultural business, I recommend taking these three actions now:

• Assess the likely impact of the coronavirus on your business.

• Talk to your advisors and business partners.

• Reduce any time spent away from the farm to an absolute minimum.

Content by:

Thomas Westcott

We are one of the largest independent accountancy practices in the South West of England, with 17 offices across Devon and Somerset. We have 28 partners and 270 staff. Some have backgrounds in major international accounting firms, others are drawn from other leading regional firms and, of course, we have our own home grown talent. We act for a wide variety of clients ranging from individual tax return cases to businesses operating in local, national and international markets. We have built teams who hold a wide range of professional qualifications and specialisms in both sectors and services. Vigorous training programmes are maintained to ensure that skills are continuously developed and updated, ensuring that we can provide our clients with the relevant and up to date business advice that they need.

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