Tenants farmers have been told to be in the driving seat for farm rent reviews this autumn against the backdrop of 'significant changes' in government policy.
The Tenant Farmers Association (TFA) said the end of the Brexit transition period would bring new opportunities for tenant farmers, but also major challenges.
It urged farmers to 'take the initiative' on rent reviews this autumn amid changes in government policy and the trading environment.
TFA National Chairman, Mark Coulman said farmers need to look at whether their rent commitments were 'truly sustainable' within these new circumstances.
"The removal of direct payments, the creation of new environmental schemes and additional friction expected in our trading relationships with the EU, all mean it is essential to ensure that we are controlling our costs.
"Rent reviews triggered this autumn may not take effect for another 12 months, but they will set rent levels at least for the following three years,” he said.
Tenants acquiring additional land on new Farm Business Tenancies (FBTs) are also urged by the TFA to take a cautious approach in how they tender for that land.
Mr Coulman said tender rents for new Farm Business Tenancies were running at 'unsustainably high levels'.
"Routinely, we see that they are almost double the average levels of rent as recorded in the Defra rent survey," he added.
"Landlords are using short lengths of term and threats of remarketing land to keep rent levels very high. This approach has got to change.”
He said that given the uncertainty ahead, landlords should seek long-term agreements with tenants paying sustainable levels of rent and avoid regular agents’ fees in remarketing properties in short cycles.
Long-term tenancies provide opportunities for investment, growth and sustainable income for both parties, he added.
"Long-term tenancies are also a better fit for the new schemes being developed by government which propose paying farmers to produce public benefits from farmland,” said Mr Coulman.
“The TFA is on hand to provide advice, information and support in triggering a rent review or in pursuing negotiations for a rent reduction.”
