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SFP Deadline approaches

As the May 17th application deadline for the Single Farm Payment approaches, now is the time for UK farmers to consider how  currency fluctuations could substantially alter the value of their payment. The economic problems in Europe are well documented and far from over and are responsible for more than a 10% variation in the value of the pound against the euro in the last twelve months. Farmers should therefore opt to be paid in euros from the European Central Bank so that they can take control of their payment and plan ahead. They then have a variety of choices as to how they wish to manage their payment and, with the help of an experienced currency specialist, ensure they achieve the best possible exchange rate.  If they don’t then they are at the mercy of the currency markets and whatever the exchange rate happens to be at the end of September.

Currency options

To help UK farmers plan for movements in the currency markets and make the most of their Single Farm Payment, we offer a selection of flexible solutions such as a free forward contract which allows them to fix an exchange rate for a future date. Alternatively, they can select a foreign exchange option which allows them to guarantee a minimum exchange rate whilst benefitting  should it improve over the life of this contract.

As well as protecting themselves from any adverse effects of the Eurozone crisis or the impact of drought, knowing exactly how far the Single Farm Payment will stretch will make planning and budgeting for the year ahead more manageable.”

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