Farmers will not be forced to go organic when Prince Charles' estate buys Pru land

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The Independent Online

Prince Charles's estate moved swiftly yesterday to reassure the tenants on the 28,000 acres of prime farmland that it is buying from Prudential that there are no plans to change the way the farms are run.

Prince Charles's estate moved swiftly yesterday to reassure the tenants on the 28,000 acres of prime farmland that it is buying from Prudential that there are no plans to change the way the farms are run.

There is no question of the 60 tenants' farms being made to "go organic" following the £50m purchase, a spokeswoman for the Duchy of Cornwall said yesterday. "The existing tenants will be allowed to farm exactly as they wish," she added.

The Duchy approached the Pru with the offer to buy the insurer's entire agricultural holdings as part of a plan to rebalance the Duchy's investment portfolio.

It sold some of its shares in order to fund the land purchase, but declined to name which stocks were involved. Altogether the Duchy's capital is valued at £280m.

British farmland prices have suffered, along with the downturn in agriculture generally, due in part to the BSE scare. Prices have fallen from an average of £3,000 an acre two years ago to about £2,500 an acre, although they are well above the depths of the recession in 1993, when they touched just £1,000 an acre.

"It's a very good investment for the Duchy," says Mark McAndrew, of property agent Strutt & Parker. "Over the last 20 years land prices have gone hand in hand with the stock market. With all these new houses needing to be built, farmland will become more scarce. After all, they're not making any more of it."

The deal, which will be completed in the spring, brings the 662-year-old Duchy's holdings to 147,000 acres, most of it in the South-west of England. The agreement also includes more than 7,000 acres of farmland in Angus, Scotland, which will be resold, as ancient laws governing the Duchy prevent it from owning Scottish land. "Property agents are rubbing their hands at the prospect," says Mr McAndrew.

"The Prince of Wales, as the Duke of Cornwall, has been consulted and has warmly endorsed the Duchy's plans," a spokesman said.

Prince Charles, the 24th Duke of Cornwall, cannot touch the estate's capital and does not own any of its property, but he is entitled to the income generated from its assets. The Prince does not receive any money from the public purse.

Last year, the Duchy generated a surplus of £6.4m before tax, leaving the Prince with around £4m, some £2.5 m of which was used on official expenses.

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