Soaring costs are hindering farmers’ action on climate – survey
25th August 2022
NatWest research shows the majority of farmers surveyed had to put climate action on hold due to rising costs.
Nearly all farmers surveyed (99%) have seen at least one routine expense rise above the general UK CPI inflation rate of 9%.
For 70%, their energy bills have risen above inflation, while 66% have seen fuel, 54% have seen feed and 48% have seen fertiliser costs exceed inflation respectively.
In addition to putting pressure on farming businesses, rising costs are hampering efforts to reduce carbon emissions. Eighty-two per cent of farmers felt frustration or even guilt at not being able to take planned action on climate change.
A large majority of those surveyed (88%) said they were somewhat worried about the impact climate change will have on the future of farming – but 37% feel unable to act due to having to prioritise critical business activity.
Survey participants wanted to reduce their carbon footprint by switching to an energy supplier with stronger environmental credentials (49%), improving the energy efficiency of their premises (54%) or increasing renewable energy usage (57%).
Support measures
NatWest is offering an additional £1.25bn in funding to help the industry deal with increasing input costs and create more sustainable ways of working.
The bank is also freezing all charges and tariffs on its business current accounts for at least 12 months, as well as reducing interest rates on its range of Small Business Loans up to £40,000, by between 0.5% and 1.35% dependent on term and amount.
Additionally, it is providing capital repayment holidays, where the business only needs to pay the interest on a loan for an agreed period, reducing the amount due each month as well as increases to overdrafts.
In June, NatWest introduced a package to help support customers in the agriculture sector, with individual financial support available for those hit by increased farm running costs. The announcement followed the bank publication of a white paper recommending a series of longer-term interventions that should be taken by policy makers, financial services and the sector itself to achieve a nature-positive transition.
NatWest head of agriculture Ian Burrow, said: “We want to provide the financial means and accessibility for farmers to pursue their climate ambitions. 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.”
The campaign also offers tips and advice for farmers looking to go and grow greener, as well as tailored support such as Green Loans – an arrangement fee free loan offered to qualifying businesses to help them invest in sustainable infrastructure.
NatWest has created a carbon planner to help businesses get an accurate picture of their climate emissions. This is currently being developed to include specific support for farmers. Information on available funding support is included within NatWest’s Climate Hub.
NatWest’s agriculture relationship managers have also taken part in training to ensure they’re equipped to offer the most effective advice to farmers seeking support.
