THE value of loans agreed for land purchases in the South West rose by 13 per cent in 2018 according to figures revealed at the Agricultural Mortgage Corporation’s (AMC) regional agent conference on Wednesday (February 6) in Ilminster.

AMC, which provides long term, fixed rate loans with no breaks to more than 9,000 farming businesses across the UK, revealed that loans agreed for land and farm purchases made up for almost half of its lending in the South West last year. These loans were concentrated in the second half of the year and included a number of the Crown’s Taunton Estate sitting tenant purchases.

AMC’s South West Regional Agricultural Manager, Jonathon Day, shared with agents that overall loan applications in the region increased by more than 14 per cent in 2018, a 5-year high, with 13 per cent of these coming from non-farming rural businesses.

A third of applications came from the region’s prevalent dairy sector, which saw improved milk prices in 2018.

Lending for capital expenditure was up 22 per cent on 2017, which AMC reports was boosted by farmers receiving capital grants for building works and investment in robotic milking machines.

AMC works closely with 28 land agents from various companies across the South West, who carry out its loan application and valuation work. A number of these agents, and key stakeholders from AMC’s network in the region, attended the conference.

As well as reflecting on 2018, the group discussed issues facing the sector, including the potential impact of Brexit, land prices, the amount of land which may come to the market in 2019 and lending opportunities for the year ahead.

Jonathon Day said: “2018 was one of our strongest ever years for loan applications in the South West, with 75 per cent of these coming through AMC agents.

“It was also a year of two halves. The cold and wet spring reduced appetite for capital investment, giving us a quiet start. But this was followed by a busy second half due to land coming onto the market later than usual.

“We know that farmers from across the region are committed to the long-term success of their businesses, but that uncertainty continues to be a significant factor. We are committed to helping farmers navigate these issues and provide the tailored guidance needed to help them successfully navigate challenges.

“Farming businesses need to prepare for the future and structuring finances appropriately is an important part of ensuring loan repayments are affordable so that businesses can continue to grow and navigate times of uncertainty. It’s important to consider options for growth and discuss the viability of expansion projects to ensure you’re well positioned to evolve and succeed, whatever the future holds.”

Headquartered in Andover, AMC has worked with land-based commercial farming businesses since 1928 to support a wide range of growth and diversification initiatives, covering everything from an initial land purchase to large scale investments.