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Natural capital: The view from a small family farm

Robert Fraser, Herefordshire farmer and Executive Director of the Real Farming Trust, on how markets for nature will favour big landowners and allow companies to continue to offset harmful practices while the most biodiverse farms are being forced to intensify or give up

June 2023

The loss of the Basic Payment Scheme and the lack of Sustainable Farming Incentive (SFI) standards for our highly biodiverse farm has forced us to review the business. We have concluded that our small and much loved suckler herd of Beef Shorthorns is no longer financially viable. The harsh reality is that the finances for a small farm like ours no longer stack up, unless we scale up. Defra recently announced changes to payments for upland farms, but much more needs to be done. We are selling our cattle and exploring other income sources, including diversification, tree planting, and payments for storing carbon or biodiversity net gain.

Moving away from producing high quality, nature-friendly food for the local community here is, to put it mildly, soul-destroying. We are bereft about letting our cows go.

It’s not straightforward either. Farming carbon instead of producing food could lock farmers into long contracts, and out of their land, for 30 years or more - but carbon needs to be stored for at least 100 years to make a difference to global warming, and we must reach net zero by 2050. And the idea that carbon emitted by burning fossil fuels, which stays in the atmosphere for thousands of years, is the same as biological carbon stored in trees, for example (which may have a short life span), is a ploy to make offsetting sound attractive.

Carbon and nature credits are sold as a simple solution to a complex problem, and they allow big companies to continue emitting and destroying the environment. Nature is complex, like all life, and can't be measured adequately in this way.

The Food, Farming and Countryside Commission is calling for better regulation to ease the path of new nature markets. How will smaller and tenant farmers fare? It's difficult to see how they will flourish. Small and medium-sized farms, the best for biodiversity, are being forced to intensify to fill the subsidy gap, or are giving up, like we are doing. Nature markets will favour big landowners, and allow companies to continue to offset their harmful practices. Farmers are being priced out of the land market, as outside investors swoop in.

The idea of selling credits to any company that wants to 'greenwash' its appearance is not attractive. The ethics really concern me. Even if I did want to seek out such opportunities, I find they are not really available to me. These schemes are only interested in ‘new’ natural capital, not maintaining biodiverse farms like mine. Natural capital markets are also highly complex. I question where the power lies in the relationship between farmer and investor. Who will own the data? Inevitably, that relationship will be extractive.

As a farmer I have a fundamental role in reviving nature and improving soil health, but I doubt that the heart's desire of some private investors is the ultimate restoration of UK biodiversity, or protecting the livelihoods of small farmers and rural communities. I think we should tread cautiously.

The urgent need for significant transformative change across society, but most especially farming, has been recognised by many, with the most recent review of farm bird declines across Europe concluding:

“The tremendous negative impact of agricultural intensification on birds has long been reported in particular for farmland and insectivorous birds, but our study provides strong evidence of a direct and predominant effect of farmland practices at large continental scales. Considering both the overwhelming negative impact of agricultural intensification and the homogenization introduced by temperature and land-use changes, our results suggest that the fate of common European bird populations depends on the rapid implementation of transformative change in European societies, and especially in agricultural reform.”

Instead of a restructured farm support scheme that creates the conditions for destructive and unnecessary intensification (even as it aspires to enhance ‘natural capital’), we need meaningful investment in farm systems that work with instead of against nature. Such investment should be going into agroecological farming - supporting small and medium-sized farms to address as a whole the polycrisis we now face across food, climate, biodiversity and health. That is how we will build local resilience in the face of future climate and food security shocks.

Robert Fraser is a Herefordshire farmer and Executive Director of the Real Farming Trust.

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The opinions expressed in this blog are the authors' and not necessarily those of the wider Link membership.