Insights: supporting Northern Ireland’s farmers through Brexit
Barclays is determined to build long-term relationships with Northern Ireland’s agriculture businesses through Brexit and beyond. National Head of Agriculture, Mark Suthern, describes the resilience of the sector – and how Barclays is backing UK farming sector from large agribusinesses to small family firms.
Something to remember about Northern Ireland is that as well as being home to huge agribusinesses, it’s a land of family farms too. Some people might see that as a danger, but I see it as a real strength. It allows people to be resilient by controlling costs at a time when there is a degree of uncertainty.
Barclays has a national network of over 1,500 on-the-ground relationship managers, and as my Barclays team travels around the province, meeting clients individually and in clinics, we’ve been talking to businesses about the things they can influence on the ground as much as broader political concerns. Political uncertainty doesn’t help – we know there could be issues around tariffs, labour and borders, and don’t yet know the full shape of those issues – but farmers are used to levels of uncertainty in cause and effect, even down to the weather. In the agriculture sector, you can’t just shut the door and wait: cows need milking, crops need tending and harvesting, livestock need feeding. The sector can’t just pause, rain or shine, deal or no deal.
There’s a bit of a myth that people are holding off on capital investment. We’re still seeing people borrow money for new projects. Although there are cases where people are waiting until there is more certainty, for every farmer I talk to who is pausing, I speak to another who comes to me with an immediate business plan.
It’s about applying a UK lens to a unique market in a unique time but making sure we continue to support with traditional banking services and relationships
National Head of Agriculture
Brexit and its unknowns exist, and nowhere more so than in Northern Ireland, the part of the UK with a land border with the EU – a region where thousands of jobs are linked to agriculture and related sectors, with a huge influence on the overall UK economy. We’re talking all the time with government, businesses and organisations like the Ulster Farmers’ Union to make sure that we understand the complexity of any deal that’s signed off, and its implications for Northern Ireland. But one of the things that’s important is that we’re still lending to clients for 10, 15 and 25-year plans to help invest in their businesses, using a strong agricultural team of managers who understand the region and the sector and think in terms of long-term relationships beyond Brexit.
So far this year, we’ve held a farming-focused Brexit clinic in County Down, a large Ulster Farmers’ Union event in Ballymena, and numerous individual meetings with farmers large and small. Our conversations in Northern Ireland are looking at cost structure, business plans, succession, and a focus on profitability and thinking about margins more than yields. We don’t work on any particular assumption about the political outcome of Brexit, but our background assumption is that the sector is incredibly resilient and innovative. The increasing use of technology and data offers extra resilience, and the prevalence of small, family businesses provides a strong platform for the sector in Northern Ireland to survive and thrive.
There’s a bit of a myth that people are holding off on capital investment
National Head of Agriculture, Barclays
Labour issues continue to be potential concerns for our clients in some Brexit scenarios, but the use of new technologies can mitigate problems here. Brexit is not the sole catalyst for automation, but it could be an accelerant for change, with a likely increase in the use of robotics in the dairy sector and precision farming in the arable sector. These developments involve investment for long-term benefit – and those investments involve banks.
So, while there are some unique concerns in the province, we’re totally focused on backing and lending to those clients, drawing down from our £14bn SME lending fund where possible. It’s about being very visible in the market, and looking at the same issues we do everywhere else: issues around age and succession are relevant, issues of gender, of mental health. It’s about applying a UK lens to a unique market in a unique time while also making sure we continue to support with traditional banking services and relationships.