22 February 2010 Trading Update

With trading of area only payments at £180 - £190 per hectare, interest still remains strong with purchasers also realising the investment potential in the higher value entitlements.

Purchasers must now be aware of the imminent March trading deadline, urging those with enquiries to make contact as soon as possible.

15 January 2010 Trading Update

An increased demand in area only sees prices firming, with trading at £175-180 per hectare.

January 2010 Trading Update

A brisk start to trading, values have firmed and demand is much stronger as more and more farmers realise the investment potential.

Area only now trading at £155 -160 per hectare - this is your base price - depending on amount of history price will increase

Purchasers beware it is clear that the RPA are only using SBI numbers when processing deals (not cross referencing with trading name)- please insure you give the correct SBI to which ever agent is transferring entitlements and check carefully the number on YOUR paperwork

In recent years the trend has been for most deals to be agreed in March, not only does this put agents under pressure but creates issues for the RPA - we would urge all those looking to sell or buy to get a deal done by mid February this allows time for the paperwork to be dealt with efficiently and aids the process

December 2009 Trading Update

This year with 2009 payments made earlier trade has started much sooner. The RLR mapping exercise has also highlighted land without entitlements.

As a result more deals have been done to date than by this time last year- values have if anything firmed with Area only entitlements (RAP's) the most sought after - early trade was at £145 per hectare with trade now at £150per hectare

September 2009 - Trading Update

Entitlement trading has commenced for 2010!

There seems to be a significant increase in the number of enquiries, with a number of deals already agreed. However the current supply is not meeting the demand! Therefore those with entitlements to sell are encouraged to get them on the register with clients actively seeking specific areas.

9th February 2009 - Trading Update

Entitlement trading has picked up enormously in the last few weeks, with over 380ha of English Non SDA and 65 ha of standard Welsh entitlement being traded through Rostons since the beginning of the January. 14 deals have been confirmed ranging from lots as small as 2.27 hectares to a large deal of 263 hectares.

By the end of January we had traded more hectares than we did in total last year so we are well on our way to doubling the amount traded by the closing date of trading this year.

There seemed to be a big rise in the number of enquiries in the middle of January, perhaps when farmers received their claim statements and began to think about the forthcoming year Single Farm Payment. Although we have seen a slight dip in the interest since then, we are still receiving a steady number of enquiries about both buying and selling English and Welsh entitlements and expect the interest to pick up again as we head towards the RPA transfer deadline on the 2nd April.

We are receiving new instructions to sell regularly as farmers sense the trade is picking up and it is time to start advertising them for sale. Most of the new instructions will stand a good chance of being sold before the end of the trading year.

We have seen set-aside entitlements selling at around £100 each and there seem to be a lot of demand for it, especially since it was recently announced that they would revert to normal entitlements. Multipliers have ranged from 0.41 to 1.36, with a majority of the deals being around 1.25.

Demand for flat rate and high value entitlements, especially Welsh, seems to be outstripping supply at the moment whereas there are fewer enquiries about purchasing entitlement with a value of around €200 - €250.

Rostons are also able to do Naked Land transfers for those farmers who have entitlements they want to activate for the 2009 scheme year but have a shortage of land so we are always on the look out for available naked land.

Rostons will cease trading entitlements for the 2009 scheme year on 20th March in order to allow the RLE1 transfer forms to reach the RPA by 2nd April, the trading deadline. We are still looking to sell entitlement and are always on the look-out for vendors with entitlement available to sell.

January 2009 - Trading Update

As we are not far off the busiest time of the year for entitlement trading, the trade is picking up quickley with a steady stream of enquiries about both buying and selling English and Welsh entitlements.

The deals the entitlement trading team here at Rostons have done so far this year consist of a lot larger lots, whereas last year the deals were a lot smaller amounts. The multipliers have ranged from 0.7 up to 1.28 2007 face value this year, less than last year as the face value continues to decrease along with the historic element.

Although there have been a large number of deals, supply still outstrips demand. With set-aside now being converted to Normal entitlements we are expecting more flat rate entitlements to come on the market. High value Welsh entitlements are always in high demand but there are not many willing vendors.

We still have a number of lots of both English and Welsh entitlements on our register and the list will carry on growing as some may farmers realise that they cannot use their entitlements this year and wish to sell.

We are also able to do Naked Land transfers for those farmers who have entitlements they want to activate for the 2009 scheme year but have a shortage of land so we are always on the look out for available naked land.

Rostons will cease trading entitlements for the 2009 scheme year on 20th March in order to allow the RLE1 forms to reach the RPA by 2nd April, the trading deadline.

April 2008 - Review Trading Year 2007/08

The 2007/08 has been a record trading year. Our office has transferred over 600ha of entitlements, which is 200ha more than last year and over double the amount traded in 2005/06. But with one deal of nearly 700ha not completing, the year could have been more prosperous.

Though demand this year has been greater than previous years, supply still out weighs demand. This year, like previous years, did not get off to a flying start with only a handful of deals being confirmed before Christmas. Trade picked up in early January with the majority of trading occurring in March with nearly 20 deals being confirmed.

Multipliers used ranged from 0.7 up to 2.6 times 2007 face value.

Flat rate English entitlements varied greatly in price depending on the requirements of our clients. Prices for flat rate ranged from £95 per ha up to £170 per ha.

Low value English entitlements with historic traded around 1.2 to 1.8 times 07 face value, but as the value of the entitlement increased the multiplier used decreased. Entitlements with 07 values exceeding £1,000 multipliers drop as low as 0.7. We believe that the pricing policy we use reflects a good investment for the purchaser and a good return for the vendor.

Set aside trading this year has been extremely quiet, though this was expected. Only two deals were confirmed compared with 24 deals last year. This is down to set aside being 0% for this year, so there hasn't been the need to offload un-wanted set aside entitlements.

There has been a lot of demand for high value Welsh entitlements. Many potential purchasers looking for values of in excess of £250 per ha willing to pay anything between 1.5 to 2 times face value. This year the highest value lot of welsh entitlements on our books was 150 ha which achieved between 1 and 1.1 times face value when sold. Welsh farmers are missing a trick though, purchasing high value entitlements will see a greater total monies return for their investment, but investing in lower value entitlements with a smaller multiplier will see a greater percentage return with nearly all the investment be recovered in the first year they are claimed on.

March 2008 - Update

As the deadline (2nd April) for this trading year aproaches, the availability of English NON SDA entitlements is far greater than the demand. But demand for English SDA and Welsh high value entitlements seem to out weigh the supply.

Our offices will look to cease trading on the 20th March 2008 to give time to exchange contracts and for payment to clear before submitting RLE1 form to the RPA to meet the 2nd April 2008 deadline.

Multipliers used this year have ranged from 0.9 up to 2 times 07 value based on the rate of the return over the next 5 years to the purchaser.

September 2007 - Update

Availabilty is still continuing to outstrip demand however there are more deals being done than this time last year.  There is a good amount of interest being shown but most seem to be just looking. 

The value of entitlements has varied this year.  This is due to the fact that a purchase now would give rise to payment in 2008 and that payment would be made up of a lesser proportion of the historical value, hence a lower return for their money in most cases.  For those high value entitlements in 2005 the value soon drops away to the flat rate from 2008 to 2012.

Setaside Update

The Nil Rate of Setaside for 2008 has been approved in principle by the Council of Ministers. It is now in the hands of the Commission to create a  draft regulation covering how this would work in practice.

It does not look likely that these rules will be clear before crop establishment this autumn.  Once the regulations are finalised they have to go for approval to the European Parliament.  Farmers should make decisions about their setaside at their own risk - as it stands the requirement still needs fulfilling. 

It is thought that the regulations will not change the entitlement payment.  Additionally the SAS entitlements are likely to still have to be claimed first before the other payment is unlocked, because of the way the RPA computer system works.  As such they will still be a liability and farmers would in theory still have to pay to get rid of them, though if there are no restrictions to them, there is no benefit of paying someone to take them.

May 2007 - Update

All transfers for the 2007 claim have now completed succesfully and our entitlement trading team are now looking to the 2008 claim period.

As expected there has been a very slow start to this trading period following a busy month incurred by all completing SP5 forms ensuring every last detail is correct.

The early enquries have begun,  prospective purchasers are keen on our thoughts regarding values this year which many expect to be between 1.2 - 1.4 times 2005 value. We welcome any enquiries whether you are interested in purchasing or selling entitlements or are just after some general advice.

April 2007 - Update

The trading of entitlements never did get off to a flying start. Whilst vast quantites have been available throughout the trading period, the distinct lack of purchasers retained modest prices accross the board. Normal English entitlements traded mainly at between 1.7 and 1.9 times the 2005 value depending on whether dairy premium was involved. As we approached the tail end of the trading period, some vendors keen to sell reluctantly accepted face value.

With the current press regarding the future of FVP's, trading in these slowed down rapidly during January as many then saw them as an expensive investment that could possibly half their worth in the next two years. To date these have rarely traded above 1.9 times the 2005 value.  

Setaside has continued to trade with a negative value with many vendors keen to be rid of it. The balance between the guaranteed and non-guaranteed routes of disposal has been fairly equal.  

On the whole the trade for the 2007 claim has been steady whilst availability outstripped demand. This caused a resultant price reduction and left many entitlements still available following the dealine for transfers.

February 2007 - Update

As we approach the deadline for entitlement transfers, April 2nd, and the first farmers are beginning to recieve their Single Payment, interest in purchasing entitlements has grown with a sgnificant number of enquiries turning into deals.  Having now recieved monies from the RPA a number of clients have quickly purchased more entitlements to cover naked land and increase the value of their Single Payment.

Naked land update

Farmers with spare entitlements are advised to seriously consider activating these. We have a number of clients with naked land wishing tolet their land through a tenancy and implementing a contract farming agreement in order that others can activate their entitlements. This is a sensible way to retain ownership of entitlements as if not claimed on for three consecutive years, they will be confiscated into the national reserve.

Charges for this are as follows: -

• Arable / Grassland - £40 - £50 /acre
• Setaside - £50 - £75 /acre

A charge will also apply if we provide you with a contract farming agreement and tenancy agreement. Please telephone Chris Ruffley for further information on - 01829 773000.

January 2007 - Update

Interest in purchasing entitlements has grown vastly now that we are into the new year. The past week has been rather successful for entitlementtrading.info having seen a number of significant deals taking place.

December 2006 - Update

December has shown an ongoing increase in the volume of entitlements on the market. This has been reflected by a growth in interested parties wishing to purchase entitlements. It is expected that the number of transfers will grow rapidly into the new year given the April deadline.

Prospective purchasers are advised to contact us now given our broad range of entitlement values and block sizes currently available

November 2006 - Update

Following the summer and a downturn in workload many farmers have now turned their attention to administrative work. The last two weeks have shown a significant growth in interest, again from people with naked land.

We are obtaining a number of lots with little or no historic element. These have proved popular given that payments in subsequent years will increase rather than decreasing rapidly as with high value entitlements.

Naked land is trading at £35/acre. We have a high demand for this and anybody wishing to dispose of such land should get in touch.

October 2006 - Update

Increase in interest with a number of deals taking place. Most purchasers are those that have traded away setaside and therefore have naked land. Those that have taken on land without entitlements are also showing a keen interst.

Transferors continue to pay to trade away setaside. We have setaside available if you are interested and guarantee to activate it. The best example of this would be someone growing industrial crops.

Contact us for further details.

September 2006- Trading Update

Entitlements with Dairy premuim trading well at similar multipliers to last year

Higher value less demand

2007 Trading Has started - August 2006

August update - more interest in trading, much talk and now some deals are happening

Entitlements with Milk Quota worth more trading at a 1.9 multiplier

Those with average history 1.5 multiplier and low value area only 5 times multiplier

Setaside trading - August 2006 update

It appears that certain agents still haven't grasped the rules - if you are unclear what to do speak to us

We are offering two routes to trade your setaside as last year - both are legal.

The warranted route where the transferee will warrent to claim against the entitlement and the non warranted

If you grow industrial crops / non food crops and want to be paid to take setaside ie warrenting to claim call us

2006 Trade update

Naked land / low value entitlements

If you have land without entitlements or you have low value area ones we can help you make more of them

Interest already exists for 2007 for welsh and english land

2006 Trade update

The extension to the deadline was very much a PR exercise in our opinion, there was certainly no rush of fresh trade

All in all a good start to entitlement trading for Carver Knowles(NW) Ltd, all transfers have been approved and none rejected out of a total of well over 125 transfer forms submitted

English trade

Normal entitlements traded at 1.6 - 1.8 (times the 2005 value) depending on value of the 2005 claim, FVP's traded at 2 - 2.25 times

Set aside went either on the non warranted route at £75 per acre or the warranted at £100 - £150 per acre in both cases the transferor paid

The fact that the trade was at a negative value doesnot make it artificial. Much misinformed information is circulating on this subject so do not believe all you read

Celtic trade - Scotland and Wales

Values higher in the Celtic regions with most trading between 1.95 and 2.25 times the 2005 payment

General Rules:

The land used to activate Entitlements / Authorisation's can be different every year.

If a claim was successfully made to the National Reserve and entitlements are traded you will lose the National Reserve element.

Discussion Groups / Speaker for meetings

If any group wants a speaker on Single Payment, quota, entitlements, land and property issues we are able to supply one.

Tony Rimmer is currently giving a thought provoking paper titled ' Farming the next Generation' - contact the office for details

Likely Timetable

Taxation:

Sale of entitlements will give rise to Capital Gains Tax (CGT).
As a business asset taper relief will be 50% in 2006 and 100% in 2007:

i.e. 20% tax liability in 2006
10% tax liability in 2007

 02 March 2009

In 2009…..

Set-aside entitlements will be converted to normal entitlements. They will still be valued at the relevant SPS flat rate.

• You will not be required to Set-aside any of your land for SPS 2009 scheme year.
• You can still choose to leave uncropped land and can use this to support Normal Entitlements
• On your 2009 application form, old set-aside entitlements will called “Normal; formally Set-aside.”

National Reserve (English reserve) entitlements will also convert to Normal.

You will no longer need to activate your former English reserve entitlements every year to avoid the national reserve top-up element being lost to national reserve.

• The Normal entitlement usage rule will apply. They will also be transferable.  

• On your 2009 application form, old national reserve entitlements will called “Normal; formally national reserve”

From 1st January 09, when transferring out entitlements you do not need to be a farmer at the date of transfer. This means you can retire then transfer your entitlements.

You no longer need to have used at least 80% of your entitlements allocated in 2005 to transfer entitlements by sale or gift without land.

Currently you have to activate your Normal and Special entitlements once in every three years. This will still apply in the 2009 scheme year. However…

• From the 2010 scheme year you will have to activate your entitlements for payment at least once every two years. This means in 2012 you will need to activate any entitlements that were last activated in 2007 or 2008 to avoid loosing them to the national reserve.

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FVP Update

DEFRA Minister Jeff Rooker announced on the 29th August that FVP authorisations and the negative crop list are to be abolished with effect from 1st January 2008. This means that farmers will not require FVP authorised entitlements in order to claim Single Payment on land growing fruit, vegetables and potatoes. 

There will be a consultation in the autumn to look at whether there will be an opportunity for those people growing negative crops to claim the single payment, and whether these people will be allocated new entitlements.

Naked land available to activate entitlements on

Over the last month significant demand existed for naked land. Most was transfered at £40 per acre with some lots moving at £35 per acre

Demand for this will exist for 2007 claims

Setaside transfers the FACTS - 2nd March 2006

Much has appeared in the Press on this subject some factual some mischief making and some dangerously wrong information

Setaside CANNOT be surrendered to the National reserve in England only in Wales - one agent has sent a letter saying this is possible they are WRONG - it is not possible

We are offering two types of trading a low risk route whereby the transferee will not warrant to claim - they will however try

The other route is where the transferee will warrant to claim - this is more costly but has minimal risk

Setaside transfers - Update 23rd February 2006

Much confusion exists following Welsh office announcement that Setaside Entitlements can be surrendered to the National Reserve.

The RPA have confirmed this is not possible ithin England.

Large quantities are continuing to trade with the transferee (taker) being paid £50 per acre (£123 / ha)

If you wish to trade away or take setaside contact the office

Transferor does not need to be a farmer - 27th January 2006
2005 SPS applicants who wish to transfer entitlements prior to 15th May 2006 do not need to be a farmer. This WILL NOT apply to 2007 transfers