Diversification will be a life-saver for many post-brexit

Comment Brian Henderson

Ican’t remember exactly when the term “diversification” became mainstream in the farming dictionary, but it was probably around the late eighties.

But using some of the resources devoted to the farming business – in the form of capital, labour, land, buildings or machinery – in a way which is slightly out of the norm was, of course, something which had been going on in the countryside for centuries.

In many respects our distant forefathers might have been far better at it than us, with subsistence farming requiring a supremely flexible mindset to make the most of what was around them.

And it’s only really in recent times that the industry has slipped into the easy groove of concentrating production on what you might call farm commodities – and then letting someone else handle the marketing and the sales, the areas where all the money is actually made.

But, increasingly, even “diversified” enterprises have a tendency to fall into a predictable series of options: alternative livestock enterprises; leisure and recreation; novel and non-food crops; sales of food and drink; renewable energy – and of course, the old standby of a bit of contracting.

Nothing wrong with these, and on some units they actually provide an important supplement to the dwindling income from mainstream farming elements.

But, as a catch-all phrase, the diversification list doesn’t need to end there – and with the industry facing the possibility of falling margins linked to the

0 Bed and breakfast is a welcome addition to incomes certainty of reductions in support measures, these sources of income, once looked upon as pin money, are likely to play an increasingly important role in the future of many farms.

This will be especially so when the current Brexit “honeymoon” of the weaker pound being shored up by continued farm support ends – and the cold, harsh wind of reality begins to blow after we actually quit the EU.

Already on many units “diversification” has been extended to employment outside the confines of the farming business.

It would be fair to say that a combination of sex equality and economic necessity has meant that the vast majority of farmers’ wives – or husbands – bring home an income which plays a significant role in not only providing for the family, but also in supporting the farm business.

And, as it seems to take ever more acres to provide the economies of scale to keep the business viable, many are beginning to realise that another option might be a second job for the farmer himself.

For, while time spent away from the farm always seems to mean a job left undone or a “marginal gain” not achieved, a cold and dispassionate look at the economics might show where the real gains lie in such an approach.

I realise that not everyone can hope to be paid (admittedly not much) for pontificating in print – but sharing such thoughts with an enlightened farm consultant recently, he agreed that taking a job outside farming was an approach which was likely to become much more widespread.

And he said it would be a damn sight cheaper than the conventional diversification route of converting farm buildings for holiday accommodation or horse livery or buying machinery to undercut the local contractor.

He’d seen many desperate attempts to bring in more cash by misguidedly spending capital on such ventures – and, adding a new term to the growing farming lexicon, he named this phenomenon “distress diversification”.

In all other areas of employment societal changes in recent decades has meant that there are few guarantees of a job for life – and very few people, even if they are lucky enough to move into a job after finishing their studies, would ever expect to still be there when they retire.

Farming, too, is changing – and the pace of this change will only accelerate post-brexit, meaning job security in our industry will no longer guaranteed either.

It might just be time to start flexing that second string to our bows.