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Photo of cows with strap line how to get the best deal on livestock finance

How To Get The Best Deal On Livestock Finance

The challenges facing livestock farmers have never been so significant. One of the greatest threats to livestock farming is the increasing pressure to consider the animals’ wellbeing.

Combine this with the growing demand for organic options, environmental concerns, and the need to keep costs low – it’s no surprise that animal farmers increasingly need support.

Challenges For Livestock Farmers

Across the UK there are growing concerns regarding the end of EU subsidies that help finance farming operations. Although the UK government has pledged to keep supporting farmers, some may find their grants cut by around 25%

The UK government will offer subsidies based on environmental projects as well as animal welfare activities to encourage farmers to be ethically and environmentally conscious. A trade deal with the US could also flood the UK market with imported animal products, which will add to UK farmers’ concerns.

As well as the impending impact of leaving the EU and losing the securities provided by EU regulations and financing, UK farmers are also facing the ongoing impact of the Coronavirus outbreak.

Restrictions on the restaurant and the catering industry have meant demand for home-cooked food has grown. Some supermarkets are showing a 20% increase in demand while the commercial catering industry has all but stopped.

Photo of supermarket selling meat produce sourced from farmers

This means livestock farmers are having to change how they function. Food sold to the commercial catering industry has different regulations compared to animal products sold to supermarkets. Farmers with existing livestock have to finance new machinery and feed to adapt to the new normal.

Fluctuating Finance Options

Everything is in fluctuation. As changes and fluctuations in the market impact farmers, obtaining extra finance to buy livestock is difficult.

Bank and lenders are tightening criteria for loans, especially in unpredictable industries like agriculture.  The complications increase when taking into account the additional costs of maintaining a flock or herd over several years.

Livestock was always traditionally bought using extra cash or a bank overdraft. However, traditional banks are less willing to lend during a period of instability, and cash reserves are dwindling.

Securing Livestock Finance

Luckily, agricultural loan brokers such as Evangate FS, are able to offer several solutions that will allow UK farmers to grow their herd, increase genetic diversity across a flock and maintain a livestock farm. Finance options are available from £5,000 upwards, so no matter what size farm you run, securing finance should not be a major concern.

Most livestock specialist brokers will be able to loan you up to 100% of the purchase amount. You will need to state in advance what exactly you are buying. However, brokers don’t discriminate between breeding cattle, dairy cows, chicken pullets, or sheep flocks; they just want proof of purchase.

Photo of chicken pullets bought using livestock finance

Similar to crop and produce farming, it may take several months before you reap any rewards from your livestock. Loan amounts can range from short term, around 12 months, to long term at about 84 months depending on the animal. The length of the loan will also determine the set-up fees and the Annual Percentage Rates when it comes to payback.

Types Of Livestock Financing

There are lots of options available when it comes to types of loans, which means you can find the right finance for your farming business. Speaking to a specialist livestock finance broker can help make this decision easy and straightforward and ensure you get what you need.

An unsecured business loan, where you don’t stake the loan against any assets, are becoming more popular. This is because they are a great way to ease any cashflow problems and help with the day-to-day running of the farm. They can even be used to purchase feed, fertilizer, pay vet bills and buy equipment.

Most UK livestock farmers should also consider property-specific loans. Commercial property loans can be used to acquire more farm buildings that livestock farmers need. Feed stores, chicken sheds, cattle housing, and storage buildings all fall under the agricultural building category, so they can be used to levy additional specific finance to build, restore or maintain the building. 

If you already have assets to borrow against, you can secure long term, rolling finance. When it comes to refreshing your flock or herd, ongoing support can make all the difference. You can use the proceeds from the sale of existing stock to secure finance for new purchases.

Buying Livestock

Photo of cattle bought using livestock finance in the UK

When it comes to actually buying livestock, the recent coronavirus outbreak has resulted in a change in regulations when it comes to buying, selling, exchanging and raising livestock. Many farmers have turned to online marketplaces to purchase animals.

Physical markets can be crowded and busy with no social distancing. So, for the foreseeable future, online auctions and digital markets are growing in popularity.

Famers generally buy livestock at auctions where professional auctioneers promote and sell the animals. Different auction categories mean if you know what you are looking for – you will go specifically to one auction or one market.

You should be aware that with social distancing restrictions, auctioneers’ control how many farmers can currently attend the market.

When it comes to online auctions, websites can host live video streams or post videos of the animals up for sale in advance before bidding begins. Some websites and mobile apps offer similar services.

This allows farmers to trade and do business without necessarily meeting up in person.

How To Get The Best Deal

Whether you are a livestock farmer looking to expand or diversify, or looking to buy your first herd or flock, specialist lenders can help you get the finance you need.

There are many ever-changing challenges to livestock farming and agricultural finance specialists, including Evangate FS, are aware of this. That is why we offer affordable livestock finance which is often more attractive compared to traditional bank loans.

Livestock farmers often have to react quickly to changing conditions such as extreme weather, the current pandemic as well as specific threats like herd illness.

Flexible financing solutions can help ease cashflow problems and ensure you have access to money when you need it most. Raising animals can be unpredictable; securing finance doesn’t have to be.

Test us out by contacting us to see if we can beat your current finance arrangements, or to see if we can offer you livestock finance quickly.


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