UK wine production is booming but are you covered?

Planting vines is fast becoming one of the more popular forms of on-farm diversification.

The UK currently has around 3,500 ha of vines in wine production. The scope for more planting, however, is huge, with recent research suggesting the country may have as many as 35,000 ha suitable for production. Hence this is a diversification which looks set to continue to increase in popularity.

While the majority of vineyards are located in the South East, successful examples can be found in almost every county, Wales and even as far north as Scotland.

Wine production has many advantages for a landowner, not least the value of the wine itself. According to recent figures, such is the level of demand that land suitable for growing vines can be worth as much as twice that of arable land. As a result some landowners not interested in investing themselves are considering letting land to other producers and rents are rising. However, length of tenancy is important given the time taken and costs involved in establishing a working vineyard.

Establishment costs are high, averaging in the region of £12,000 per acre as a norm, possibly more when soil conditioning, fencing, and purchasing winery and farming equipment are included. This is on top of the cost of the vines themselves. Given the size of investment it is important to make sure the property, any liabilities, and your income stream are well protected.

Earlier in the year we saw the devastating bush fires rage across the Australian wine-producing areas and were reminded what damage fire can do to a business. The summer of 2018 showed we are not immune to crop fires here in the UK, with the probability of such occurrences only likely to increase as global temperatures rise.

A fire in a building storing the year’s harvest, or wine supplies of a previous vintage, can devastate a business. In such an instance business interruption cover as well as cover for the actual damage to property and crop can save the day.

At Lycetts we have many years of experience in insuring vineyards as well as wineries, be it for producers, landlords or tenants. We can offer cover for buildings, machinery, vines, stock, chemicals, and fuel supplies as well as other infrastructure and business interruption. Many wineries also run complimentary businesses on site such as restaurants, cafés and shops, and for these too we can provide comprehensive cover, so please contact us for further information.