MANY SCOTTISH farmers could benefit from commercial opportunities in the three key sectors which offer the potential to transform their businesses – renewable energy, forestry and tourism.

According to Ian Hope, head of Galbraith’s rural department, the trinity offer farmers the best potential for diversified profits, despite the uncertainties of the post-Brexit landscape. Speaking at the firm’s recent farming seminar Mr Hope said: "Commercial forestry continues to be one of the most rewarding areas for new entrants, with the best woodlands generating returns in excess of 10% a year. In addition to the very attractive returns, the tax system is geared towards helping those who invest in woodland. No Income Tax or Capital Gains Tax is payable on the sale of timber and commercial forests are entitled to 100% Business Property Relief from Inheritance Tax after two years of ownership.

“Tourism businesses can offer good returns, but location is the critical factor to bear in mind," said Mr Hope. "Urban fringe farms can do well in terms of offering farm shops, family facilities, coffee shops and the like. Glamping pods, chalets or other holiday lets can do well if the farm is close to a known tourist route such as the NC500 or Loch Lomond. It is important to consider whether an investment in a new venture can offer the potential to diversify from the existing business and perhaps to cushion the main business from short term variations in commodity prices.

“Even the renewable energy sector, which is not as attractive as it once was, can still offer good returns in projects such as combined heat and power plants, biomass, or anaerobic digesters," he advised. "Landowners may also wish to consider the potential to host a battery unit on their land for electricity storage, which is a growing sphere of activity, in partnership with utility companies."