Agency confident of increase in land values
Charles Dudgeon, head of Savills Rural in Scotland, is confident that the best arable land in the country will increase by up to 20% in value in the current year.
According to Savills' recently-published Agricultural Land Market survey, the value of prime arable land in Scotland rose to an estimated average of £4250 per acre by the year-end, but Dudgeon reveals that he achieved £7000 an arable acre late in 2007.
It now emerges that Scottish farmland values outperformed the UK average in 2007, up by 29% at £2775 an acre at the latest count.
Scottish owner-farmers will have seen their land almost double in value in the past three years.
In comparison, UK farmland values were up by 28% in 2007 equivalent to £3450 per acre, although Savills points out that without the higher percentage of rough upland in the Scottish figure, farmland values north of the border would have been markedly greater.
To illustrate this, the supply of farmland publicly for sale in Scotland totalled 40,000 acres, only marginally up on 2006, but still representing nearly 25% of the total acreage for sale in the UK.
Ian Bailey, head of Savills rural research, comments: "Historically farmland has been a safe, low-risk investment giving an annualised total return of over 10% during the past 30 years.
"However, its recent outperformance of most other asset classes has attracted institutional investors, fund managers and the City.
"I expect this to increase in the present year, with other classes of property assets less likely to perform satisfactorily against an uncertain economic backdrop."
Dudgeon commented: "Looking at the UK as a whole, although investors accounted for only 10% of the market share last year, a proportion similar to that of 2006, there is strong evidence emerging to suggest that this proportion is likely to rise.
"Whether it will reach the levels recorded in the late 1980s, when more than one fifth of buyers, including the pension funds, were investors remains to be seen."
Speaking at a seminar in Ayr, Anna Thomas, an associate director with Savills, warned that while arable land values are set to rise, stock farm values might be topping out.
She pointed out that the prospects for beef and sheep were not good and that recent falls in Irish farm values may weaken the traditionally strong demand for livestock farms from Irish buyers.
Defra confirms bluetongue plans THE British Veterinary Association (BVA) president Nick Blayney has acknowledged that the arrival of the bluetongue virus presented a new and significant challenge to veterinary surgeons and their clients.
Department of the Environment, Food and Rural Affairs (Defra) Secretary Hilary Benn has published a UK plan for bluetongue vaccination over the months ahead. He confirmed that the approach will be voluntary and that English farmers will be able to purchase vaccine from Defra.
England is the first country in northern Europe to place an order for 22.5 million doses of vaccine.
"The deal is the government pays for the order up front and the full cost is then recovered as the vaccine is used by farmers," said Benn.
In a letter published in the BVA's journal, the Veterinary Record, Blayney pointed out that an adequate level of uptake would be required to achieve significant national herd immunity.
"We must", he said, "persuade our clients within the bluetongue protection zone of the necessity of mass vaccination and our target must be 100% - including all hobby farmers and keepers of exotic susceptible species."
"The key" according to Blayney, "is for the vaccine to be administered swiftly so that levels of immunity precede the further spread of the virus when the midge population becomes active and temperatures are sufficiently high for virus transmission to occur."
theherald.co.uk, 19.02.2008