Impact of new CAP on grain markets

Grain sales will, of course, only be part of the income equation in coming years.

There will be a negative impact from the new CAP, with Julian Bell estimating a potential reduction in Single Farm Payment of £75 per hectare.

Everything pointed towards a payment of around 230 euros per ha.

“This equates to roughly a £10 per tonne shortfall, and the question is how to make this up,” he said.

“Better yields will be important, but will buyers be prepared to make up the difference with better prices?

“It could make long- term contracts with distillers and other end users more important.”

The need to comply with the three-crop rule will be a factor, with an estimated 900 farmers affected for a number of reasons.

It could cause a 20,000 hectare or 7% reduction in the Scottish spring barley area, which would have a significant effect on distillers.

Mr Bell added: “I am less worried about large areas of land moving to Ecological Focus Areas.

“I think there will be enough wriggle room to avoid this being a huge threat.”