How a Family Farm Used Agricultural Finance to Expand Their Beef Herd
Farming has always been a way of life for this husband-and-wife team, who recently took over their family farm following the retirement of the husband’s parents. With a strong commitment to securing the future of their business, they set their sights on expanding their beef herd.
However, there was a challenge—accessing the right agricultural finance to achieve their goals. With the need to invest in additional cattle while managing existing financial commitments, they began exploring agricultural finance funding options that would allow them to grow sustainably.
Background: A Multi-Generational Farming Story
This family farm has been worked for over 40 years, originally as a tenancy held by the husband’s grandfather. Over time, the farm passed through the generations, with the husband working alongside his grandfather and parents. Although the family owned the farmhouse and some land, a large portion remained under a tenancy agreement. Seven years ago, the couple moved into the farmhouse, reducing their costs while maintaining their tenancy on the remaining land.
Both husband and wife have deep farming roots, having grown up in agricultural families. While the husband has worked on the farm all his life, his wife has also been involved in the industry, now working part-time at a local livestock market. Taking over the farm was a natural next step for them, but with that came the responsibility of making it financially viable for the long term.
The Farm and Its Operations
The farm operates as a mixed holding, balancing both livestock and arable farming to maximise efficiency. They grow barley, winter wheat, corn, and sugar beet, primarily for animal fodder, reducing their reliance on bought-in feed. Their livestock business consists of a beef herd and a flock of sheep, both of which are sold through a well-known local livestock mart, a key trading hub for farmers in the region.
In recent years, the couple has refined their approach to livestock management. They focus on Limousin cattle, which are known for their strong conformation and high-quality beef. Store cattle are purchased at 7–12 months old, finished over six months, and then sold at market. While they have maintained their sheep flock, they’ve decided not to expand it further due to the time and labour demands of lambing. Instead, they are focusing on increasing their beef herd, as they see this as a more sustainable and profitable route for the future.
The Challenge: Expansion Requires Agricultural Finance
With a solid foundation in place, the couple saw an opportunity to grow their beef business. Increasing cattle numbers would improve turnover and strengthen the farm’s future, but expansion required significant upfront investment. Store cattle are expensive to buy, and the farm needed enough working capital to purchase quality stock while ensuring they could be properly fed and finished.
At the same time, existing hire purchase (HP) agreements on essential machinery—tractors, a truck, and a loadall—were putting pressure on cash flow. Although these investments had been necessary for running the farm efficiently, the monthly repayments were restricting their ability to reinvest in livestock. Reducing these financial commitments would free up more income, making the farm more financially stable in the long term.
Like many family-run farms, they faced the challenge of securing the right finance. Traditional high street banks often take a rigid approach to lending, which doesn’t always suit the seasonal nature of farming. They needed a flexible funding solution that would allow them to buy cattle and reduce their financial outgoings without putting the farm under unnecessary strain.
The Solution: An Agricultural Loan for Growth
To achieve their goals, the couple secured a £150,000 agricultural loan with UK Agricultural Finance. This provided the flexibility they needed to invest in their beef business while strengthening the farm’s financial position.
The loan was structured to support two key priorities:
- £90,000 was allocated to purchasing 100 store cattle, allowing them to increase herd numbers and improve profitability.
- £60,000 was used to clear existing hire purchase agreements on essential farm machinery, reducing monthly outgoings and easing cash flow pressures.
By consolidating their debts and investing in additional livestock, they created a more sustainable financial model for the farm. With a low Loan-to-Value (LTV) of under 20%, the loan was secured against their farmland and agricultural buildings, ensuring manageable repayments. Crucially, this funding allowed them to expand at the right time, without the constraints of rigid high street lending criteria.
The Impact: Strengthening the Farm’s Future
With the loan in place, the couple was able to purchase additional cattle, setting the farm on a path toward greater productivity and profitability. Increasing their beef herd meant they could generate higher returns from livestock sales while making the most of their homegrown feed. This not only improved margins but also helped them future-proof the business.
Clearing the hire purchase agreements significantly reduced their monthly financial commitments, easing cash flow pressures and giving them more flexibility to reinvest in the farm as needed. With a more stable financial footing, they could focus on day-to-day operations without the stress of mounting repayments.
Looking ahead, they are also exploring additional revenue opportunities, to further improve the long term profitability of their farm ready for the next generation.
Why UK Agricultural Finance?
Securing finance as a family-run farm can be challenging, especially when traditional lenders take a one-size-fits-all approach. That’s where UK Agricultural Finance stands apart. With a deep understanding of the complexities of rural businesses and the challenges that come with generational farming, we offer tailored financial solutions designed to support long-term growth.
For this couple, securing a loan wasn’t just about increasing cattle numbers—it was about securing their farm’s future. Our flexible approach allowed them to secure a loan that worked for them without unnecessary financial strain.
If you’re looking to expand your farm business, we’re here to help. Contact us today to find out how we can support your growth.