Budget Day, the SFI Fallout and a Tight Grain Market: This Week in British Farming

Week ending Wednesday 28 October 2026

It has been a week of policy headlines. The Chancellor delivered his first Budget on Wednesday, MPs have been grilling ministers over the Sustainable Farming Incentive, and the first avian flu case of the new season has been confirmed in England. Meanwhile, new grain figures confirm what many arable farmers already knew: this was a tough harvest. Here is what matters, and what to do about it.

The Budget: help with costs, but no change on family farm tax

Chancellor John Healey said he is extending the cuts to fuel duty and red diesel through winter and spring to July, pointing to high fuel prices driven by the war in the Middle East. Diesel costs were the NFU's headline Budget ask this week, so that will be welcome on farms of every type.

Two other measures are worth noting:

Fertiliser tariffs. The Government had already signalled ahead of the Budget that it would cut tariffs on fertiliser, with the reduction due to take effect on 26 November 2026. Heating oil tariffs are also being cut. Separately, a carbon tax on imported fertiliser is still scheduled for 1 January 2027, so check with your merchant how the two interact before you buy for spring.
Business rates. The relief threshold in England rises from £12,000 to £18,000, which the Chancellor said will take around 70,000 businesses out of paying business rates. If you run a farm shop, holiday lets or other diversification, it is worth checking your rateable value.

On inheritance tax, Farmers Guardian's live coverage reported no U-turn on the so-called family farm tax. The reformed reliefs have applied since 6 April 2026. As we understand it, 100% relief applies to the first £2.5m of qualifying agricultural and business property (up to £5m for a couple), with 50% relief above that, giving an effective 20% rate, and tax can be paid in instalments over ten years. Land values have risen a long way, so many estates can exceed the threshold more easily than expected. If you have not reviewed your succession plan since April, now is a good time to speak to your accountant or solicitor.

SFI26: a scheme that ran out in six hours

The fallout from September's second SFI window is still running. It opened at 10am on 22 September and closed at 3.48pm, after roughly 12,200 applications used up the £253m budget, an average of about £20,700 each. Farmers reported IT problems and missing the window by minutes.

This week Farming Minister Stephen Morgan faced the Efra Committee, and told MPs that the decisions on how SFI26 would run were taken before he arrived at Defra. Earlier, he had acknowledged that those who missed out would be deeply disappointed, and said alternatives to first-come, first-served would be considered for SFI27, which Defra plans to open in 2027.

What if you missed out? Countryside Stewardship Higher Tier remains open through the Expression of Interest process, so it is worth talking to your agent about it. And if you want your voice heard, talk to your MP: the NFU is encouraging affected members to do exactly that.

Grain: smaller crops and tighter supplies

AHDB's early balance sheets, published on 22 October, put the 2026 UK wheat crop at 12.07 million tonnes, up 1% on last year but 9% below the five-year average. Barley is the bigger story: at 5.50 million tonnes it is down 14% and 21% below average, and the 2026/27 barley balance is the lowest on record. Drought means feed demand is expected to stay high.

For growers, this is a reminder to look hard at your marketing plan and your input costs together. For livestock farmers who buy in feed, tight barley supplies and higher feed use are worth factoring into winter budgets.

Bluetongue: start planning for 2027 now

There have been 3,436 reported cases of bluetongue (BTV-3 or unspecified serotype) in the UK this season, and vets are warning that the virus is likely to overwinter. Defra has advised farmers to start planning their vaccination programmes for next year.

Last summer showed the problem with leaving it late: a National Sheep Association survey found 40% of respondents had been unable to get hold of vaccine, while 65% said they would definitely vaccinate next year. There are also concerns about ram fertility this tupping season. If you have not already, book a conversation with your vet, and consider breeding soundness checks on your rams.

Avian flu is back in England

Highly pathogenic avian influenza H5N1 was confirmed in a commercial flock near Belford in Northumberland on 19 October, the first English case of the 2026/27 season. It follows a confirmed H5N5 case in Scotland earlier in the month. A 3km protection zone and 10km surveillance zone were put in place and the birds on the premises were culled.

Migratory birds are arriving, so this is the moment to tighten biosecurity, whatever size your flock. Defra is also funding biosecurity advisory reviews for poultry keepers. Remember that suspected cases must be reported immediately.

In brief

Sheep: the National Sheep Association is asking for a clear roadmap on proposed changes to castration and tail docking, with a decision on the consultation expected in late autumn.
Pigs: the Government is seeking views on phasing out high-concentration CO₂ for pig stunning.
Livestock worrying: a sheep owner near Wigan lost 53 lambs to a dog attack and is unhappy with the police response. If it happens to you, report it and gather evidence straight away.
Labour: sheep shearers have been left off the visa list, raising concerns about 2027.
Retail: Aldi and ABP launched a beef supply initiative involving around 1,000 farmers.

Your checklist for the week

Ask your fertiliser merchant about timing, given the tariff cut on 26 November and the carbon tax due in January.
Review your inheritance tax and succession position with an adviser.
Talk to your vet about bluetongue vaccination for 2027, and about ram fertility.
Check your poultry biosecurity, and book a funded review if you are eligible.
If you missed SFI, speak to your agent about Higher Tier.

This post is general information, not financial, tax or legal advice. Details of Budget measures were still emerging at the time of writing, so check gov.uk and your adviser before acting.