2017-10-02 

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2017 BPS Payment Values up by 4.98%

Payments made to farmers under the 2017 Basic Payment Scheme will be just under 5% higher than in 2016 and at their highest level since 2009, because of a more beneficial currency exchange rate.

Under the rules of the Common Agricultural Policy (CAP), support payments for farmers across the UK are set in euros and then converted to Sterling using the average European Central Bank (ECB) exchange rate recorded across the month of September.

Land

The average rate for September 2017 was €1 = £0.89470, compared to a final conversion rate for the 2016 BPS scheme year of €1 = £0.85228.

Robert Gazely, farm consultant at Strutt & Parker, said:
“The increase in the value of payments will be a welcome boost to farmers.

“While farm profitability has improved over the past 12 months, with a weaker pound leading to commodity price rises, farm incomes for many businesses are still way down on 2011/12 levels and levels of farm borrowing are also at an all-time high.

“At the start of the month it did look as if the confirmed exchange rate would be the highest we have ever seen by some margin.

“However, September has proven to be a changeable month in terms of currency, with hints of interest rises from the Bank of England causing sterling to strengthen against both the euro and the dollar.

“What may be slightly frustrating for farmers is that if BPS had been converted using the average ECB exchange rate for August (£0.91121), payments would have been nearly 7% higher than last year, which in turn was up 16% on 2015 levels.”

The exchange rates in previous years have been as follows:

2017 scheme €1 = £0.89470

2016 scheme €1 = £0.85228

2015 scheme €1 = £0.73129

2014 scheme €1 = £0.77730

2013 scheme €1 = £0.83605

2012 scheme €1 = £0.79805

2011 scheme €1 = £0.86665

2010 scheme €1 = £0.85995

2009 scheme €1 = £0.90930

2008 scheme €1 = £0.79030

2007 scheme €1 = £0.69680

2006 scheme €1 = £0.67770

2005 scheme €1 = £0.68195

The exact value of entitlements for 2017 will not be confirmed until November, as it is based on the total number of hectares of eligible land claimed for in each region.

Strutt & Parker

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