Input costs above inflation rate


30 August 2022
Survey reveals concerning statistics amongst growers.

NEW research from NatWest shows that the agricultural sector is experiencing rising input costs significantly above the UK inflation rate, hindering their ability to take action against climate change. 

Research conducted by the bank has revealed that 70% of farmers surveyed have experienced their energy bills rise above inflation. Of those surveyed, 66% have seen their fuel bills rise above inflation, while 48% have seen fertiliser costs exceed inflation.

It also reveals that 82% feel a sense of frustration and guilt as a result of not being able to take planned action on climate measures, and nearly nine in 10 (88%) are worried about the impact climate change will have on the future of farming. 

The bank used the results of its research to tailor support packages for the sector, such as its Green Loans. It is also training its staff to be better equipped to help and advise growers seeking support.

Head of Agriculture at NatWest, Ian Burrow, said: "We are aware that our customers within the sector are keen to take action against climate change and many have already – for instance, changing cultivation practices to minimum tillage or no-till, growing cover crops, growing mixed species grass swards, challenging themselves to improve the productivity of their livestock enterprises, precision applications of fertiliser, and using organic manure more effectively along with  planting trees and hedgerows."

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He went on to add: "However, the challenge of input cost rising squeezing margins is currently hampering efforts.”  

Providing the financial means and accessibility for growers to pursue their climate ambitions was something all those in the financial sector should be looking to assist with, he said.

"Addressing climate change and reducing environmental impact is a key issue for farmers, so we’re working to remove the barriers and help the sector make changes now, which will save money and safeguard businesses in the long term.” 

Photo: Karolina Grabowska

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