SFI 2026 Sustainable Farming Incentive (SFI)

Summary

The Government have finally announced details of the new Sustainable Farming Incentive (SFI) offer which will launch later this year.

Here's what we know so far.


There will be 2 application windows:

1. First window – June – Farmers with small farms (3 - 50ha) and those without existing environmental land management agreements
2. Second window – September – All farmers

New funding cap of £100,000 annually

Payment rate decrease for certain actions:

• CSAM3: Herbal leys - £382/ha to £224/ha
• CAHL2: Winter bird food - £853/ha to £648/ha
• CNUM3: Legume fallow - £593/ha to £532/ha

SFI management payments have been removed

Key actions removed include

• CSAM1: Assess soil, test soil organic matter and produce a soil management plan
• CIPM1: Assess integrated pest management and produce a plan
• CNUM1: Assess nutrient management and produce a review report
• CHRW1: Assess and record hedgerow condition

There are new rotational action limitations – no increase from the agreed area in year 1 of each action, it can decrease.

Each farm business can only have 1 SFI 2026 agreement

What to expect, details and definitions

The aims of the SFI remain the same: to support farmers to manage their land in ways that deliver environmental benefits as they produce food.

The SFI 2026 offer will be simpler with fewer actions and less complexity whilst still having plenty of actions available for all farm type to enable growers to select actions which best fit their situation.

There are 71 actions available – 31 have been removed – due to low uptake or those that delivered less for food production, environment or the government’s wider environmental targets.

There will be a new annual agreement cap of £100,000 to ensure that more farms are able to participate and benefit. It will also help the government meet the Environmental Improvement Plan goal of doubling the number of farms delivering for wildlife by 2030.

Application window

There will be 2 application windows:

June 2026 - this will remain open for approximately 2 months (although may close sooner if demand is high or the budget for this window is reached). 

It will be open to small farms < 50ha of agricultural land and those without an existing environmental land management revenue agreement.

September 2026 - open to all farmers

Limits

There will be caps for SFI 2026 agreements.

These caps will be placed on:
Annual cap of £100,000
Each farm business can only have 1 SFI 2026 agreement

Rotational actions – limitations

• Unlike previous agreements, there will be no ability to increase the area or value of rotational actions beyond what was included in Year 1.
• Growers will be able to increase or decrease the area from year to year so long as they do not go above the Year 1 area.
• 10 ha in Year 1, 5 ha in Year 2 and 10 ha in Year 3 but not above the 10ha.

25% area limit cap on some actions

AHW7: Enhanced overwinter stubble will be added to the existing actions under the 25% cap.

These actions cannot be on more than 25% of the total agricultural area of the farm (individually or combined).

Existing 25% area limited actions:

• CIPM2: Flower-rich grass margins, blocks or in-field strips
• CAHL1: Pollen and nectar flower mix
• CAHL2: Winter bird food on arable and horticultural land
• CAHL3: Grassy field corners or blocks
• CIGL1: Take improved grassland field corners or blocks out of management
• CIGL2: Winter bird food on improved grassland
• WBD3: In-field grass strips
• AHW9: Unharvested cereal headland
• AHW11: Cultivated areas for arable plants

Payment rates

Some payment rates have been adjusted from previous SFI offers. 

There will no longer be the SFI management payment

Rate increases

Some moorland actions will see payment rates increasing:
Action Old payment rate New payment rate
UPL1: Moderate livestock grazing on moorland £20/ha £35/ha
UPL2: Low livestock grazing on moorland £53/ha £89/ha
UPL3: Limited livestock grazing on moorland £66/ha £111/ha
UPL8: Shepherding livestock on moorland (remove stock for at least 4 months) £43/ha £74/ha
UPL10: Shepherding livestock on moorland (remove stock for at least 8 months) £48/ha £102/ha
The above increases will be applied to existing agreements and SFI 2026 agreements.

Rate decreases

Payment rates will reduce for:
CSAM3: Herbal leys - £382/ha to £224/ha
CAHL2: Winter bird food - £853/ha to £648/ha
CNUM3: Legume fallow - £593/ha to £532/ha

Existing 2023 and 2024 agreements will remain at the monetary values in the agreements, and the above decreases will apply to SFI 2026 agreements.

Duration of actions
All actions will become 3 year actions in SFI 2026 in order to simplify the scheme. And make the actions more accessible for short-term tenant farmers.

Base and supplemental actions

Those applying for the SFI 2026 offer will only be able to apply for a base action and it supplemental action together e.g. CAHL2: Winter bird food on arable and horticultural land and AHW2: Supplementary winter bird food.

For the list of actions visit our SFI knowledge hub