As the agricultural support landscape continues to change, AF Chief Agricultural Officer John Barrett considers whether the disappearance of subsidies could force farming to become more market-focused, resilient and, ultimately, profitable.
“A subsidy should kickstart something: help establish an industry, activity or new way of working until it can stand on its own.
“Significant solar subsidies encouraged initial investment. Now, they’ve largely disappeared because solar stacks up financially without them, so arguably subsidies worked.
"Another way to stimulate change is introducing a tax, such as the Carbon Border Adjustment Mechanism which comes into force in the UK on 1st January 2027.
"I expect to see a significant reduction in farming's carbon footprint as CBAM incentivises more farmers to switch to lower-carbon nitrogen which will have reduced CBAM liability due to its lower manufacturing emissions."
“The Basic Payment Scheme became a significant part of farming’s income. In some cases, it supported profitability; in others, it simply propped up businesses not generating sufficient returns.
“That’s not a criticism of farmers! It’s the reality of a system that evolved over time.
“As that system changes, has British farming become sufficiently focused on what it’s producing, who it’s producing for, and whether there’s a profitable market?
“When subsidies ended in New Zealand, things were tough. But the industry developed a much greater focus on markets and export. Food and drink exports totalled NZ$53.6 billion in 2025.
“Ireland’s focus is also interesting. There are many relatively small farms, producing for a market of food and drink exports totalling €19 billion in 2025.
“That’s the direction British agriculture increasingly needs to take.”
Carrots, potatoes, and onions are some of the UK's leading fresh vegetable exports.
“Changes to environmental payments, including the £100,000 cap, will force some businesses to reconsider land use. Areas may come back into cropping, some will remain in environmental schemes, others may continue to provide environmental benefits from alternative sources of income.
“It’s a controversial opinion, but perhaps that’s how subsidies should work - initiate an activity, but ultimately that activity must find a sustainable source of income.
“Sadly not every business is well-positioned to make that transition. Those with scale, connections, and a recognisable brand may find it easier to attract private investment.
“The difficult question is what happens to businesses with significant proportions of land in environmental schemes, who no longer have the infrastructure to return to conventional farming. Letting land or entering contract farming arrangements may be the answer.”
“Some businesses are performing well, whilst others are facing serious pressure on profitability and cash.
“At AF, we see huge variance in how businesses approach their purchasing. Increasingly, farmers are looking carefully at every pound they spend.
“But buying well is not simply about comparing prices. Rather, comparing the value of two different products and being open-minded enough to consider a better value option.
“When you’re making money and have a subsidy behind you, you’re less inclined to worry about cost of inputs. When margins disappear, you worry very quickly.
“That requires a different mindset and being prepared to hear things you may not want to. Good advice is that which sometimes tells you something uncomfortable."
“Successful businesses of the future will be prepared to look honestly at what they are doing and ask: could we do this differently?"
“In positive news, we see plenty of well-farmed businesses buying well, selling well, and making a profit.
“There’s also an appetite to keep improving. The demand for capital grants demonstrates that farmers want to improve their businesses, invest in infrastructure, and modernise. That’s encouraging.
“The removal of subsidies will be painful for some. The businesses emerging strongest may be those who've used previous support to invest, improve, and build resilience rather than waiting for the next payment.
“Farming is clearly changing quickly. The question now is whether we’re prepared to change with it.”
Barrett, J. 2026. AF chief asks: Can British farming stand on its own two feet?. East Anglian Daily Times. 3rd October.
