Agricultural SMEs Optimistic About Brexit

• Confidence levels more than doubled in a year for SME’s in Agriculture (13% Q1 2016 vs. 31% Q1 2017).
• Nearly a third (31%) see the greatest opportunity as a reduction of red tape upon leaving the EU.
• 52% of SME’s in the sector are optimistic about opportunities as a result of leaving the EU.

Confidence levels across SMEs in the agricultural sector are more than double they were a year ago (13% Q1 2016 vs. 31% Q1 2017) according to the Hitachi Capital British Business Barometer research.

A sector used to experiencing tough times with bad harvests over recent years; in Q3 2016 only 17% of small agricultural business owners felt confident about their businesses future after the vote to leave. Despite being faced with further hurdles when the UK eventually leaves such as the subsidiary shortages and a loss of labour, the sector is currently optimistic about opportunities that the separation will bring.

Confidence levels across the Agricultural sector in Q1 2017

At a time when UK farmers have been promised an abolition of the ‘Three crop rule’ when we leave the EU by farming minister Andrea Leadson and estimates from Defra that dealing with red tape and farm inspections costs the industry £5m a year*, nearly a third of small enterprises in the industry (31%) would welcome less red tape. One in four (25%) see further opportunities in UK consumers ‘buying British’ and 24% of SMEs in agriculture see the weak pound as good news for exporting.

Small business growth opportunity outside of the EU

Gavin Wraith-Carter, Managing Director at Hitachi Capital Business Finance comments: “Our research shows that small business owners in the agricultural sector are thriving under the anticipation of separating from the European Union. Confidence levels among agricultural SMEs took a dip around the time of the Brexit vote. However levels have now bounced back to higher than those of a year ago with British farmers looking ahead to a fruitful harvest.

“In this case, 52% of agricultural SMEs are able to see the positives in the current climate, be it the weaker pound or a potential reduction of red tape, which no doubt are contributing factors to current levels of confidence.

“We must support our UK producers and empower farmers to be competitive globally through innovation and the adoption of new technologies. SMEs have the ability to adapt quickly when required and what we are seeing overall – whether or not this reflects their own political beliefs – is a drive to make the best of any outcome to the Brexit situation.”