Scotland’s rural economy: farming, resilience and growth

The success of rural businesses isn’t just about what happens on the farm

There are few better places to take the temperature of Scotland’s rural economy than the Royal Highland Show.

There is a real sense, walking around Ingliston, of a sector that knows itself well. You see tradition everywhere: in the livestock rings, in the family names, in the pride people take in what they do. But right alongside that, you see something else: a willingness to adapt. You’ve got generations of experience standing next to businesses that didn’t exist ten years ago; livestock rings a few minutes from robotics demos. It’s not forced – it just works. And it says something important about where agriculture is right now.

At Barclays, we’ve been working alongside the agriculture sector for well over two centuries, so we’re used to seeing periods of change. But what feels different today is the pace and, in many cases, the mindset that comes with it.

One of the more encouraging conversations I’ve had recently was with a third-generation family business we’ve just started working with. They’ve had their best year to date. That’s not necessarily the headline people expect to hear, but it’s a reminder that, for all the challenges in the sector, there are also real opportunities.

And that’s broadly what we’re hearing. Yes, there are pressures – input costs, labour, uncertainty – but there’s also ambition. People are asking: how do we grow? How do we diversify? Where do we invest next?

You can see that reflected in the data as well. Through our Business Prosperity Index, we’ve seen Scottish agriculture businesses taking a disciplined approach to managing their finances – with modest increases in cash coming in, tighter control of outgoings, and savings balances up by close to 9 per cent over the past year. It’s not dramatic, but it points to something important: businesses are actively building resilience alongside looking for opportunities to grow.

Someone I spoke to at the show described the last few years as “steady adjustment”. That stuck with me. Not transformation in the grand sense, but small, deliberate changes over time. Trying something new, seeing what works, and building from there. It’s a very grounded way of thinking about progress. Technology is clearly a big part of that story.

Agriculture has always evolved alongside innovation, but what’s happening now feels more accessible. Whether it’s using data to make better day-to-day decisions, investing in automation, or exploring new ways of managing land, these aren’t abstract ideas anymore, they’re becoming part of how businesses actually operate.

What’s been encouraging from our perspective is the number of businesses helping to drive that change. Through our Eagle Labs network, we work with founders and scale-ups across the UK, including a growing group focused on agriculture and the rural economy. What stands out is how practical their thinking tends to be. These aren’t solutions looking for problems they’re businesses working closely with farmers to solve real challenges.

Our Eagle Lab Farm, developed with the University of Lincoln, is one example of that in action giving companies space to test and develop ideas in a real-world setting. But more broadly, it reflects a simple point: innovation works best when it’s collaborative.

Of course, none of this happens in a vacuum. If there’s one thing that comes up time and again in conversations with clients, it’s the importance of access to finance. Whether it’s investing in machinery, adopting new technology or opening up a new line of business, having the confidence, and the backing, to take that next step really matters.

That’s why we’ve committed £22 billion through our Business Prosperity Fund to support businesses across the UK, including those in agriculture and the rural economy. In reality, that’s not about big announcements – it’s about what actually happens on the ground. It’s helping a farm invest in new equipment that improves efficiency. It’s backing a food producer that’s looking to scale. Or it’s supporting someone with a genuinely new idea to get it off the ground.

Individually, those decisions can feel quite small. But collectively, they are what drive long-term growth. And they reflect something else we see very clearly: the rural economy is more diverse than it is often given credit for.

Farming remains at its core, but it sits alongside food and drink, tourism, energy, technology and more. That mix gives Scotland a real advantage. It creates resilience, opens up new opportunities, and positions the country well in a world that increasingly values sustainability and quality.

What you’re reminded of at the Royal Highland Show is just how interconnected all of this is.

The success of rural businesses isn’t just about what happens on the farm. It’s about access to markets, to skills, to finance, to ideas. It’s about making sure that the system around the sector works as well as the sector itself.

Looking ahead, the opportunities are there. From agritech to new approaches to land use, from energy diversification to export growth, there’s a strong sense that Scotland’s rural economy has more to give. But realising that potential will take continued collaboration across businesses, policymakers and financial institutions.

Above all, it comes back to confidence to invest, to try new approaches, and to take a long-term view. That doesn’t come from any single initiative – it builds over time, through consistency, clarity and support.

That’s where we see our role. Not just as a lender, but as a partner – working alongside businesses as they navigate change, helping connect them to the right networks, and supporting the investment needed to grow.

What strikes me about the rural economy at the moment is the overall feeling of momentum. A sector that’s realistic about its challenges, but not defined by them. Because while the challenges facing agriculture are real, so too are the opportunities.

And if the conversations sparked by this year’s Royal Highland Show are anything to go by, Scotland’s rural economy is well placed to meet that challenge - not through sudden transformation, but through steady, determined progress.

Jamie Grant is Head of Barclays Corporate Banking, Scotland