The Savills Portfolio

Landscope

25 August 2021

Where should habitat creation activity be targeted to maximise its impact?

This is the key question that Local Nature Recovery Strategies will answer, making them one of the most influential tools in steering future land management decisions. Defra has just started consulting on what these ‘environmental blueprints’ should contain, who should be involved and how they should be agreed.

Investment in ‘farm tech’ reached a new peak of $7.9 billion in 2020. Investment interest is strong in companies focused on verification of carbon sequestration and overall food system sustainability; information that is becoming increasingly important to help farmers market their products. Alongside sustainability challenges, the health credentials of meat can be a point of debate too. Livestock farmers will be encouraged by a recent Advertising Standards Authority ruling that it is legitimate for meat and dairy products to be marketed on the basis they provide essential nutrients that are important to a healthy diet. 

FOOD & FARMING

Meat advert win for AHDB
The Agriculture and Horticulture Development Board’s (AHDB) ‘We Eat Balanced’ TV campaign said meat and dairy products provide essential nutrients that are important for a healthy diet. The Advertising Standards Authority (ASA) received 487 complaints about the advert, with Humane League UK, The Vegan Society and PETA among the complainants. However, after reviewing the advert, ASA has ruled that it was not misleading and is based on truthful evidence. The AHDB has called this a ‘landmark ruling’ for British farmers and also for the wider debate around food and farming in the UK. Meat eating is a notoriously heated topic for debate, and whilst there is a general understanding that reducing our national meat intake would be beneficial for society’s health as well as the environment’s, achieving a balanced diet from a 100% plant-based diet can be challenging. The Grocer believes this ruling on AHDB’s meat positive advert has proved the meat sector should start to stand up for itself and take a proactive stance in arguing how ethically produced, environmentally friendly meat and dairy can and should have a place in a sustainable food future.

Better welfare for farm animals during transit
The government has brought in new animal welfare measures that require higher welfare standards for farm animals during transportation. The measures include shorter maximum journey times, stricter regulations on movement in extreme hot or cold temperatures, and more headroom for animals. The maximum journey times proposed vary between four to 24 hours depending on animal species and age. For example, the maximum for newly weaned pigs is 12 hours and for other pigs 18 hours, whilst for calves under nine months old it is nine hours. For cattle and sheep a maximum journey time of 21 hours had been considered, however due to complexities involving markets and collection centres the government has said it will do further work with stakeholders before selecting a maximum.

The new rules will apply to animals being transported within England and Wales, and they come alongside the introduction of a ban on live animal exports for slaughter and fattening, which is currently passing through Parliament as part of the Animal Welfare (Kept Animals) Bill. These new welfare conditions for livestock transport would apply to all journeys over 65 kilometres. The announcement follows a 12 week consultation launched in December, to gather industry and public views on proposals to improve animal welfare in transit. The government will now work with the farming sector and other stakeholders to develop its plans and introduce the new regulations.

Gower Salt Marsh Lamb gains protection
Gower Salt Marsh Lamb has become the first new food to receive UK product protected status since the UK left the EU. The new independent Geographical Indication (GI) schemes were launched after the end of the transition period to ensure that UK products can still obtain special status to mark and protect their authenticity and origin. The designations mean consumers can buy iconic food and drink products with confidence, and producers whose foods are granted GI status benefit from intellectual property protection. Lamb producers on the Gower Peninsular in South Wales were able to demonstrate their meat’s characteristics are essentially and exclusively due to where it is produced. As a result meat produced from lambs born and reared on the peninsular now has full protection and recognition as a Protected Designation of Origin (PDO). There are now 17 GIs in Wales, and Gower Salt Marsh Lamb sits alongside other iconic UK products such as Scotch Whisky and Wensleydale Cheese in being able to use the GI logo on its branding. The national extension of GIs and PDOs will support the government’s drive to boost opportunities for agricultural trade as ‘global Britain’ pushes for new trading partnerships.

 

POLICY

Innovation competition launched by Defra
In October 2021, Defra will launch the first competitions of the new Industry-led R&D Partnerships fund. This is one of three funds in Defra’s new Farming Innovation Programme. The fund will encourage stakeholders within the rural sector to collaborate and innovate in order to address the challenges that are currently facing the agricultural and horticultural sectors. It will support the development of new ideas, technologies and processes which will help the sector to become more productive whilst also increasing environmental resilience and achieving net zero ambitions. The industry-led R&D Partnerships fund will be delivered in partnership with UK Research and Innovation.

There will be four competitions each with a different focus and grant size available. Project teams will be able to apply for grants towards the total project costs, while providing some of their own match funding. Farmers, growers, agri-businesses and other businesses or researchers from England are all able to apply to the competitions, which will be open from October 2021 for up to seven weeks. More information is due to be released in the autumn. The four competitions are:

• Research Starter Projects: projects for up to 12 months with total costs between £28,000 - £56,000. These projects are to help farmers and growers with early stage ideas develop them further and build a collaborative team

• Feasibility Projects: projects for up to two years with total costs between £200,000 - £500,000. These projects are to test the feasibility of early-stage solutions and to inform decisions on subsequent larger scale R&D projects

• Small R&D Partnership Projects: projects for up to three years with total costs of between £1 million and £3 million. These are projects to carry out R&D for innovative solutions that have the potential to substantially improve overall productivity, sustainability and resilience of the sector

• Large R&D Partnership Projects: projects for up to four years with a total cost of between £3 million - £5 million. This competition is for larger scale R&D and demonstration of solutions that have the potential to improve overall productivity, sustainability and resilience of the sector.

Scotland: Investing in food and drink sector innovation
Scottish food and drink suppliers and producers wishing to invest in future growth could benefit from £7.3 million of government support. The annual Food Processing, Marketing and Cooperation Grant Scheme supports projects such as feasibility studies, cooperative ventures and the improvement of supply-chain efficiency. Applicants to the scheme will be asked to demonstrate the benefits their project will provide to the local economy, including shortening supply chains and increasing the use of local produce and markets. Businesses will also have to demonstrate their commitment to the principles of fair work and outline how their proposed projects will contribute to net zero. If you would like to discuss this opportunity please contact Andrew Macdonald.

Landscape Recovery Test and Trials
Defra has confirmed that it is taking forward 31 proposals to develop into new tests and trials for the third component of Environmental Land Management, Landscape Recovery. Landscape Recovery is intended to deliver long term, large scale, landscape and ecosystem recovery. Some of the key challenges that Defra intends for the new tests and trials to focus on include:

• How to support farmers and land managers to deliver a collaborative Landscape Recovery project, what long term agreements for different land ownership structures might look like

• How to blend public and private finance – how private investment can complement Defra funding to enable environmental targets to be met

• How to align Landscape Recovery projects with wider Defra initiatives such as Biodiversity Net Gain, the Peat and Tree Action Plans and proposed species introductions

• How to balance the delivery of national and local environmental priorities through Landscape Recovery projects.

It is really encouraging to see that Defra is tackling these significant and pivotal questions head on, and that it is communicating its intentions so transparently. 

 

ENVIRONMENT & NATURAL CAPITAL

Developing a blueprint for the environment
Defra has launched a consultation on Local Nature Recovery Strategies (LNRS). These are set to be key documents which map specific opportunities for environmental investment and steer habitat creation activity towards areas where it will have the greatest benefit. The strategies will support the delivery of nature-based solutions and help target investment in nature from the Biodiversity Net Gain policy. The expectation is that around 50 LNRS will cover the whole of England with no overlaps; the basis for setting their boundaries is not yet known but the number suggests they will be approximately county sized. The requirement for there to be LNRS, what they are, and how they should generally work, will be established by the Environment Bill. To ensure that they can be introduced swiftly after the Bill gains Royal Assent, Defra is taking action now to gather views on key questions that will help it to produce the necessary regulations and guidance for LNRS.

Environmental Land Management, and the England Trees and Peat Action Plans will all feed into LNRS – Defra hopes that LNRS will provide a cohesive way to link environmental action across the country. The key question is how the creation of each LNRS will take into account the perspectives of all local stakeholders, and how the government intends to engage land managers in the creation process. Amongst the consultation questions it is exploring whether or not landowners or managers should be able to opt their land out of being identified as an area with importance for biodiversity, and whether additional areas can be proposed. The consultation is open until 12 November 2021.

Arla: A sustainable future for British dairy
Arla has used the carbon footprint data from its 1,964 UK dairy farmers to calculate that on average 1.13kg of CO2 is emitted to produce each litre of raw milk. This is approximately 50% lower than the global average emissions for a dairy farm and less than the UK average of 1.25 kg of CO2 per litre. The emissions come from five key areas on farm – cow digestion (46%), cow feed (37% - which varies depending on where and how the feed is produced), manure handling (9%), energy production and usage (5%) and emissions from peat soils (1%).

Arla has set a target of reducing its on-farm emissions by 30% by 2030. Achieving this will require a range of techniques and strategies to be adopted on-farm. The report says that there is a big opportunity to reduce emissions from feed, as well as through targeting cow digestion. It is thought that managing the protein level in feed rations could reduce unnecessary methane and nitrous oxide emissions and precision slurry spreading could cut airborne ammonia emissions substantially, however the cost of precision equipment is a barrier to this solution. Through this work Arla is leading the dairy industry in its carbon emissions research, monitoring and transparency, but it is also aware that this is just the start of a long (yet fast) road to decarbonisation.

 

PROPERTY & DEVELOPMENT 

Boiler scrappage grant to be unveiled
Homeowners could be offered up to £7,000 to replace gas boilers with low carbon alternatives. To support new technologies such as heat pumps there are plans to unveil a new Clean Heat Grant scheme in April 2022 with an expected budget of £400 million available over three years. Originally, the scheme was due to run for two years with a budget of £100 million, offering people grants of up to £4,000 but it has been boosted at the prime minister’s request. The new plans will help to finance around 60,000 heat pumps and cut the cost of the technology so that it is competitive against gas boilers. It is believed Mr Johnson wants to announce the scheme in advance of the COP26 climate change conference, but is facing pushback from the Treasury amid fears the scheme could fail like the Green Homes Grant.

Scotland leading the way with renewable energy
Scottish government data shows that 97% of electricity produced in Scotland was generated by renewables in 2020. This takes Scotland into the top three nations in Europe producing clean energy, behind Norway and Iceland. Scotland is ahead of Sweden, Denmark and Germany and well ahead of the UK which produces just 35% of its electricity from renewables. With Glasgow hosting COP26 in November this year, all eyes are on Nicola Sturgeon to see what era defining policy announcements the country might make, as it is clear that Scotland is positioning itself at the front of the race to net zero emissions.

 

Business & Economy

Farm tech investing accelerating faster than ever
AgFunder has reported that ‘farm tech’ investing hit a peak of $7.9 billion in 2020, an increase of 41% from 2019’s investments in the sector. Despite the uncertainty of 2020 and 2021, it is thought that the Covid-19 pandemic may have buoyed farm technology as it demonstrated the fragility of the current industrial agricultural supply and food supply chain. The investment is led by two different areas: Ag Biotechnology and Novel Farming Systems. In 2020 alone 173 ag biotech company deals were completed. French insect farming venture Ynsect scored the largest amount of funding in the novel farming sector in 2020, raising $222 million in 2020, takings its Series C total to $372 million, to build an industrial sized farm for its Molitor mealworms near Amiens in France. This year, Ynsect has acquired Dutch insect farming company Protifarm. As well as Ag Biotechnology and Novel Farming Systems, there were some substantial deals taking place in the agribusiness marketplace last year, with Boston based Indigo Ag raising two investment rounds, totalling $535 million and California based Farmers Business Network raising $250 million. Looking forward, verification of carbon-capture accounting is seen as a key sector to watch in 2021, alongside overall food system sustainability.

Wales: Farm Business Grant
A new expression of interest window for the Farm Business Grant will open on 1 September. It will offer a total of £2 million to farmers to invest in new technology and equipment to help improve their technical, financial and environmental performance.

 

OTHER RURAL NEWS

And finally…
Non-slip roof tiles for bats
The National Trust’s Oxburgh Hall in Norfolk is undergoing a significant re-roofing project. The new tiles chosen to re-roof the historic manor house are black-glazed pan-tiles which match those used on the house over two centuries ago. However, the black glaze on the new tiles proved to be too slippery for the property’s resident bats. So bat experts carried out tests and found that a coating of paint mixed with sand allowed the bats to grip with the tiny claws on their thumbs and feet to climb easily to their rooftop roosts.