The market for agricultural land in Scotland remains buoyant, with good arable fetching up to £10,000 per acre, but those with land that has development potential need a reality check over values.
That was the view of Andrew Wood, Group Partner in land agents Bidwells, when he addressed farming journalists in Perth.
According to Mr Wood, development land on Edinburgh's outskirts that may have been worth £1 million per acre before the property bubble burst, may only be worth half that today.
Elsewhere, farmers might only be able to get £150,000 per acre for land worth £500,000 at the peak of the market.
Mr Wood explained many residential land option agreements are being re-negotiated, or have been found to be difficult to operate in the current, depressed market conditions.
Apart from developers having increased costs due to delays in selling houses as a result of buyers finding it difficult to sell their own house or securing mortgages, local authorities are demanding bigger "planning gain".
That can range from the developer providing infrastructure like increased sewerage capacity, or contributions to providing school upgrades and even new schools, to building a proportion of affordable houses.
"The market has shifted from big development schemes to more modest ones," he added.
First Milk price fall
First Milk has announced that, from June 1, it will reduce its liquid pool price by 1.85p per litre (ppl), the balancing pool price by 1.4ppl, and the cheese pool price by 1.25ppl.
The new liquid price is 26.05ppl, balancing pool price 26.1ppl and cheese pool price 26.25ppl.
Declining returns from the liquid, whey and powder markets were cited as the reason for the cuts in prices, which were less than those recently imposed by other processors. Dairy Crest, Arla and Wiseman have all announced price cuts of 2ppl, while Milk Link has reduced its price by 1.5ppl.
Chairman Bill Mustoe sought to reassure his farmer-members this wasn't the start of a downward spiral, saying: "The global demand for dairy, which has been hit by some short-term over-supply, will recover and returns will be strong in the long term."
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