THE ECONOMIC CLIMATE

Over years clients have been encouraged to diversify their core business in order to spread their risk and tap in to additional income streams many of which offer a higher return on capital than producing commodity products.

However, there have been further downgrades to forecasts for economic growth since the start of the year last both in Britain and in Europe. Germany, in particular, has been hit hard by the downturn in the global manufacturing cycle. Germany is an important trading partner with the UK.

The UK economy has continued to expand, despite the adverse impact on business and consumer sentiment from Brexit, albeit it is at a sluggish pace.

Some farmers who deal with supermarkets have suffered unpredicted adverse cash flow recently as the supermarket has unilaterally announced to the farmer or the intermediate body that they are delaying payment. This was particularly prevalent at or about 31st March coinciding with rental and/or mortgage payments with significant potential consequences.

Many diversified businesses are noticing that consumers remain wary about making major commitments and those that rely on larger businesses are seeing them cutting back on capital spending. Business investment has fallen for four consecutive quarters. As a result many farm buildings which have traditionally been let remain empty.

However, those with direct consumer access have enjoyed strengthening retail spending assisted, where relevant by the recent warm and dry weather.