'Optimistic' farmers prepare for annual Ingliston highlight

Farmers preparing to head to this week's Highland Show will do so in a "relatively optimistic" frame of mind according to Jimmy McLean, head of agricultural services at Royal Bank of Scotland.

Speaking in Edinburgh yesterday, he said there were two main reasons for this upbeat frame of mind: the fact that world demand for food was now outstripping supply and reserves of such basic food commodities as grain were now lower than almost ever before.

Then he said that, on a world scale, there were limited resources to increase production with the consequence that the supply/demand balance seemed likely to move further in favour of farmers.

Within Scotland, he reckoned this year's crops were, unlike their counterparts in eastern England, generally looking well with firm output prices to look forward to. As a result, he predicted there would be a fair bit of trading going on along the machinery lines at this year's show.

Apart from the upbeat feeling, there were other drivers to spend on new equipment. Forthcoming changes in taxation will see a reduction in tax free capital investment next year and this might, he suggested, encourage some farmers to buy now rather than wait.

Those in the poultry sector who have not yet made plans to change their production systems, with the ban on battery cages coming in at the end of this year, will also have to invest or cease operation, although he admitted that the egg sector was already under the cosh with prices some 30 per cent below last year's levels as a result of an oversupplied market.

McLean also confirmed that the RBS would continue to support the Highland Show as the main sponsor with a new five year deal just starting with an estimated 1 million on the table.