What is contract farming?

How does a contract farming agreement work?

A contract farming agreement means that as the land-owner or occupier you provide the land and buildings. A (No. 2) joint bank account will be set up between you (the farmer) and A P Innes (the contractor) which will be used for day-to-day business operations. All expenditure (sprays, fertiliser, seed, drainage etc.) and all income (grain and straw sales) will pass through the account. We provide labour, power and machinery, and years of experience and expertise, enabling us not only to successfully manage soils and crop production, but also to market and sell the produce.  Our partnerships are centred on sharing the risks and rewards of the business, ensuring we provide consistent long-term performance.

Typically, a fixed fee is paid quarterly to the contractor and annually to the farmer, with an agreed profit-share arrangement paid to each party at the end of the year. The result is a mutually agreeable partnership, sharing the joint success of the contract farming agreement.

The Partnership Agreement

The Contract Farming Agreement sets out:

  • The terms of engagement – including length of the Agreement
  • The operation of the contract
  • The formula for calculating remuneration to each party, including profit-share

Our Agreements are initially for three years. Subsequently, both parties will discuss and review the arrangements and opt to either extend or terminate the Agreement. An Agreement of longer duration, following the initial period, benefits both parties through the planning and establishment of long-term strategies and investment for the farm, resulting in a more profitable and sustainable business model. Longer term Agreements also give the opportunity to focus in-depth on implementing other indirect benefits to your farm, such as further improvements to land and soil quality.

combine harvester - contract farming agreement

Farm with A P Innes

We have a fantastic team of dedicated, experienced and knowledgeable farming experts. We are committed to investing in and using the latest technology and farming strategies to improve the quality of your land and soil, and achieve the greatest crop yield and profit possible.  We also make use of the most advanced data and information systems available to support our decision-making and to determine the most successful strategy for your farm.   

Our farming methods and strategies are tried and tested on our own farm first and, when successful, if agreeable with you, we implement them on yours. We continually invest in developing our strategies, plans, processes and people to create a sustainable and profitable business.

We take a fresh, pro-active and fully accountable approach to contract farming. We believe what makes us unique is that, in addition to years of farming practice, the partnership benefits from Graham and Doug’s valuable commercial business skills and experience gained in other industries. These attributes, combined with an ability to innovate whilst working under pressure, are what set us apart from other contract farming operations.

What are the benefits?

Contract farming is becoming an increasingly important aspect of the industry, enabling farms of all sizes to operate profitable and sustainable businesses while/whilst meeting the challenges of diminishing operating margins, a volatile and ever-changing political landscape and a reduction in subsidy support.

Contract farming has many advantages which enable you to:

  • Ensure a sustainable and profitable future for your farm
  • Enjoy additional income
  • Retain your home and the tax benefits afforded to farmers
  • Develop and expand your farm without the need to invest in the costly machinery and technology required to farm efficiently
  • Enjoy the assets of your farm without the physical labour and input requirements
  • Reduce or remove people management and employment liabilities

  • Free up your time to invest in other ventures and businesses, or to retire

  • Release the capital value of owned farm machinery if land is currently farmed in-hand

We will arrange the structure of the contract farming Agreement to best fit your personal needs and situation by providing the flexible, pro-active and personal approach required to form a long- term mutually beneficial partnership.

A sustainable and profitable future for your farm

Tell us about your farm

For more information about contract farming and how we can help you get in touch and tell us about your farm.