Challenges mount for malting barley as farmers rethink plans

A fellow from Angus might well think of the north of Scotland as Inverness, but Thurso is over a hundred miles higher up, and a ‘Southerner’ like me is in danger of a nosebleed from the altitude. The cliffs of Hoy 15 miles across the water from Thurso were a reminder that North is a relative term however, and to on Orcadian or Shetlander, the ‘Southerners’ are from Caithness. Happily, there was no nosebleed, and although the distances are large and the farming quite different from home, the farmers I met in Dingwall, Tain and Halkirk were, as expected, friendly, welcoming and inquisitive, and there was particular interest in our fuel cards and electricity contracts, which are extremely competitive and have attracted members from all over Scotland. We had many invaluable conversations, made new connections, and came away with the impression of resilient farming communities.

To be sure there is hardship, particularly this year in the arable sector, and the Black Isle is a big producer of malting barley. The Glenmorangie Distillery near Tain sits silent and it is not alone. The 10% US tariff is a big factor, but also increased duties at home and overproduction all play a part, leaving malting barley growers with a dilemma of what to sow in the spring as malting barley contracts are hacked back. One thing is certain, they are a resourceful bunch, and solutions will be found.

Nonetheless the latest HSBC planning and budgeting report is a concerning read for an arable farmer. Here is a quote – “For businesses without diversified income, the data suggests that the 2025 harvest could be the third harvest in a row of cash deficits which will clearly have a significant impact on their financial stability and they may now start to question the long-term viability of arable production”

The report follows on with some sensible advice which includes a justification of the machinery ring model, which took off in Scotland following the difficult years of the mid 80s –

“Close cost control is more important than ever, and businesses should be looking at ways they can improve their resilience and maximise returns from all assets. This could be questioning variable cost inputs through to sharing machinery and labour to reduce overall costs per hectare. Where assets are not working for individual businesses, then further scrutiny should be undertaken. “

One unexpected asset worthy of scrutiny was Cat Smith MP at the Liaison Committee in Westminster on Monday. It’s turning into a dark wet and windy winter, but occasionally the clouds part and a shaft of light shines through.

Ms Smith boldly asked the PM if he considered farmers to be working people (he said he did) and then told the Prime Minister that he had changed direction in the past when he thought it was right, and he ought to do so again on IHT in the case of the forestalling laws that will catch the old and infirm who pass away within 7 years of passing on their farm. Here was a left wing Labour MP no less, pointing out the obvious injustice and the political damage in the proposed reform, and although the PM gave nothing away in the meeting despite appearing to acknowledge to his own MP that there is a risk of people taking their own lives, the blow clearly struck home, and this approach will gain momentum as April 2026 draws near. Alistair Carmichael the Lib Dem MP for Orkney backed her up, pointing out that according to Treasury figures, 75% of the £500 million they expect to raise from the tax reform will come from farmers over the age of 75, and that many of the parliamentary committees which have Labour majorities have asked for the IHT reform to take this into consideration. “Why do you not listen to your party colleagues? He asked. “I do listen to them all the time” replied the PM. Alistair, clearly sick of it, replied - “And then do what you’re going to do anyway”. The pressure on the PM is building.

Even Sir Keir deserves a peaceful Christmas however, so we will leave him alone for the time being and return to the farm, where half of my full-time staff have been away plucking Kelly Bronze turkeys for Tom and Susannah Pate at South Powrie. They seem to be very happy to go there every year for a sabbatical, and the turkey is excellent.

Brian is on the plough again after the rain has passed, and as he turns over the soil, he buries the year’s disappointments and sad memories with it to be reabsorbed into the whole. The fresh humus in the soil smells of life and new beginning and the shortest day is almost here. The great wheel has done another turn and alongside the celebration, we remember the dear ones we have lost.

Have a very peaceful Christmas everyone.