A decade long study has concluded agri-environment schemes can significantly increase local bird and butterfly populations without damaging overall food production levels as yields increased elsewhere on the farm. But the researchers warned further research into the costs and benefits is required to help inform scheme payment rates. Early indications from the Boiler Upgrade Scheme however suggest it may leave householders with too much to fund themselves as uptake to date has been low.

In this issue of Landscope we also summarise the growth of the global voluntary carbon offsetting market, and the farm carbon reduction requirement that Ireland has just placed on its farmers.

FOOD & FARMING

Environmental payments important for 80% of farmers
A growing appreciation of the impact of Defra’s vision for the future of farming means more farmers are saying they will need to make changes to their farm business in the next three to five years. According to the latest Farmer Opinion Tracker results (April 2022), 66% now say they either fully or roughly understand Defra’s vision and 68% say they will need to make changes. For some this could mean exiting the industry: 6.4% of farmers expect to retire or pass on the business within the next three to five years, and a further 3% could leave farming for other reasons. However, others are planning to expand, as 15% aim to increase the size of their business and 26% intend to diversify.

Farmers recognise the growing role for environmentally based payments, with 80% saying that Defra paying for environmental outcomes will be very (56%) or moderately (24%) important to their business in the future. Just under half of farmers (47%) feel positive about their future in farming, but confidence that changes to schemes and regulations will lead to a successful future for the farming industry is lower as 65% say they are not confident at all.

First grain ship leaves Odessa
The first grain shipment has left the port of Odessa since the invasion of Ukraine began. The Razoni, a Sierra-Leone flagged vessel, was guided out of port by a Ukrainian ship on 1st August and is carrying 26,000 tonnes of maize to Lebanon. The grain comes from last year’s harvest and its export marks significant progress for Ukraine and for global food security. Last year Ukraine was the sixth largest global exporter of wheat and agriculture accounts for more than 40% of all exports from Ukraine. The export deal, brokered by Turkey and the UN, lasts for 120 days with scope for renewal and covers both grain and fertiliser exports. Antonio Guterres, the UN Secretary General said he hoped the Razoni’s departure would be the first of many such cargos if Russia continues to cooperate. At least nine more ships have since left Ukraine’s ports. Grain markets fell after the deal was signed but have since partially recovered due to weather related concerns in the US mid-west.

Carbon neutral eggs to go on sale at Morrisons
Free-range eggs will become the first carbon neutral products launched as part of Morrisons’ drive to be directly supplied by zero-emissions British farms by 2030. The hens laying the eggs will be fed insects raised on food waste from the company’s supermarkets. This cuts out soya feed, which avoids the emissions associated with large-scale deforestation for some soya bean production, as well as reducing emissions from transportation. Insect ‘mini farm’ containers have been installed at egg suppliers in Yorkshire by the Cambridge-based start-up Better Origin. The farm that will supply the first of the eggs also has a wind turbine and solar panels and will offset emissions from the facility by planting trees too. Academics from the University of Cambridge analysed the proposed model of production and confirmed the eggs’ carbon neutral status. The free-range eggs will initially be available in 50 Yorkshire stores and a lower environmental impact store in Essex, at a cost of 30p per egg or £1.50 for a pack of six.

The future of automation in horticulture
Defra has published the results of a review into how automation can support the horticultural sector in the UK. Examples include packhouse automation, AI enabled robotics, and autonomous guided vehicles to help with the harvesting, packaging and transportation of fruit, vegetables and flowers. The review looked at what would be required to accelerate the development and uptake of automation technologies, providing a set of recommendations to the government. The recommendations included establishing a consortium that brings together government and industry to drive the adoption of proven technologies and setting up working groups to share novel harvest practices. The government will now consider the report’s recommendations and will shortly publish a response. Significant progress and support in this area will be essential if the government’s plan to encourage industrial horticulture revealed in its recently published Food Strategy in England is going to succeed, but immediate measures to address labour shortages will still be required.

POLICY

Review into labour shortages in the food supply chain
John Shropshire, who stepped down as CEO of G’s Fresh Group last year, will chair the independent review into labour shortages within the food supply chain. It will consider the challenges facing food and faming businesses to recruit and retain the labour that they require, looking at the roles of automation, domestic employment and migration routes. The review’s scope is holistic so includes meat and fish processing and the food and drink manufacturing industry too. The final report, with recommendations for government, will be published in 2023.

The Welsh way of farming
Last month, the Welsh government launched its proposal for the country’s future agricultural support policy, called the Sustainable Farming Scheme. The Welsh government wants to support a ‘Welsh Way’ of farming that is integrated within rural communities, in tune with the landscape, and makes careful use of Welsh natural capital. The rhetoric of this future support system positions sustainable food production as integral to protecting the environment and providing solutions to climate change. To find out more about the scheme and read Savills Rural Research’s analysis of the proposal, see our latest briefing note.

ENVIRONMENT & NATURAL CAPITAL

Agri-environmental farming can support wildlife and sustain food production
A decade long study by scientists from the UK Centre for Ecology and Hydrology has found agri-environment schemes can significantly increase local bird and butterfly populations without damaging overall food production levels. The study closely monitored the impacts of a large-scale Defra funded experiment at Hillesden, a 1,000 hectare commercial arable farm in Buckinghamshire. The study began in 2005 and involved taking less productive areas of land out of food production and creating new biodiverse habitats.

Researchers found the numbers of birds and butterflies increased much more significantly at Hillesden than in other comparable farmed landscapes without agri-environmental schemes over the same time. The number of great tits increased by 88%, blue tits by 73% and butterflies across the farm increased by 40% from 2009 to 2017. The new habitats and strengthened species biodiversity also increased pollination and natural pest control across the farm, boosting crop yields in certain parts of the farm which compensated for the lower preforming land removed from production. The researchers concluded further monitoring and detailed research into the true costs and benefits of this ecological intensification is required and could inform future payments rates to farmers for environmental management activities.

Nutrient neutrality: more solutions and criticism
Devolved administrations affected by nutrient neutrality are starting to develop their own area-based solutions in order to reduce river-based pollution and unlock new development. In Wales, the government has announced the introduction of a new nutrient offsetting and trading platform. More than 60% of protected rivers in Wales exceed phosphate pollution limits. A nutrient calculator will be created to aid planning decisions alongside an offset trading platform. The Welsh government has said it will launch a ‘menu’ to bring together mitigation actions and intervention and will provide up to £415,000 of funding for nutrient management boards this year. In Herefordshire, the river Wye and Lugg sub-catchments have been under high levels of nutrient protection since 2019. Herefordshire Council is now considering offering a phosphate credit trading system linked to a newly created wetland site. The council proposes trading phosphate credits will start in August 2022, on a first come first served basis.

These developments follow Defra’s recently announced plans to tackle water pollution and provide solutions to nutrient neutrality which were covered in the previous edition of Landscope. These involved mitigation as a short term solution and a requirement for waste water treatment works to be improved by 2030 to reduce the mitigation requirement; although a residual mitigation requirement will remain long term. In addition to Natural England’s mitigation scheme which will launch this autumn, the private market and local planning authorities are also developing mitigation schemes. Stewart Baseley, executive chairman of the Home Builders Federation, said the government’s latest proposals “in no way address the urgency of the issue". It is estimated that plans for 100,000 homes across 74 councils are currently on hold as a result of nutrient neutrality. 14% of England’s land area is affected.

PROPERTY & DEVELOPMENT 

Will the heat pump scheme turn out to be another flop?
So far uptake of the government’s new boiler upgrade scheme is low. The Boiler Upgrade Scheme is a three-year long programme which aims to increase domestic demand for heat pumps by providing homeowners with vouchers to reduce the cost of installation, and ministers hope it will result in plumbers installing 600,000 pumps per year by 2028. But despite 30,000 vouchers being made available for this current financial year, only 4,100 applications have been received and only 2,500 vouchers issued since the scheme opened in May 2022. The criticism is that the scheme is not generous enough. Typically an air source heat pump costs £10,000 to install but consumers can only claim up to £5,000 for it, leaving households to fund the remainder, which is unrealistic for many in the broader context of the cost-of-living crisis. Green campaigners have said the scheme is not ambitious or supportive enough and on its currently trajectory, the government will not hit its 2028 target.

Irish carbon cutting target agreed
Ireland has agreed that agricultural carbon emissions will be cut by 25% below 2018 levels by 2030. More significant cuts are being made in other sectors in order for the country to meet its overall 51% reduction target, as agriculture generates around 37% of Ireland’s carbon emissions. Farmers had been hoping for a 22% reduction whilst environmentalists were lobbying for 30%, but neither target would have allowed business as usual for the sector. Bill Callanan, a chief inspector at the Department of Agriculture said even the lower target would require “significant transformational change in the sector, on a scale that has not been seen before for Irish agriculture”. He suggested changes like expanding organic farming, slaughtering beef cattle sooner, and reducing and changing fertiliser types could perhaps achieve 70% of the reduction required, but further measures like methane reducing feed additives and grass fed anaerobic digesters would be needed too.

Business & Economy

Global voluntary carbon markets grow fourfold
According to the latest report from Ecosystem Marketplace, the value of the global voluntary carbon offsetting market nearly quadrupled in 2021 compared to 2020 and is now worth almost two billion dollars. Global average prices per tonne of carbon also increased, with significantly higher prices for projects that have additional societal and environmental benefits. The key driver for this exponential increase is the growth of nature-based solutions such as tree planting and soil carbon. There was a fourfold increase in the amount of carbon credits generated globally through forestry and land use in 2021 as compared to 2020.

Boost for biomass production
The government has announced £32 million of funding to increase UK production of sustainable biomass which can then be used as a renewable energy source. Twelve projects will receive funding through phase 2 of the Biomass Feedstocks Innovation Programme. They include increasing the growth of Miscanthus, developing on-farm pelletisation technology, heather harvesting, farming seaweed off the North Yorkshire coast, and increasing the harvesting capacity for willow. A further £5 million will support the development of 22 projects which are pioneering new technology to generate hydrogen from biomass and waste.

OTHER RURAL NEWS

Red Tractor is launching an eco-label scheme
Red Tractor is launching supermarket trials of a new environmental assurance scheme. The scheme will assess scope three emissions on British farms, as well as covering biodiversity, water use and soil health. The pilot was signed off by the Red Tractor Board last week and it is expected to run for six months to determine the feasibility of a new ‘Red Tractor + environment’ on pack logo. Christine Tacon, chair of Red Tractor, acknowledged that there are already other eco-labels on the market but emphasised “what we are trying to do is go back to that minimum audit for maximum access". This would enable farmers to have a standardised, universally recognised environmental accreditation, which she suggested should then enable farmers to charge a market premium. The pilot will explore whether the assumption that supply chains and consumers are willing to pay more is correct.

And finally…
Horseplay sees Shetland pony mayor banned from pub
A Devon village made a miniature Shetland pony called Patrick its unofficial mayor due to the positive impact his work as a therapy pony has had on the local area. Patrick, who is said to be fond of Guinness, has since been barred from his enclosure at the local pub as the council investigated a complaint and said the enclosure required planning consent.