Farmers in England with Higher Level Stewardship (HLS) or other Environmental Land Management revenue agreements approaching expiry are being told to look carefully at the timing of their Sustainable Farming Incentive 2026 applications, after Defra confirmed new functionality for SFI26 Window 2.
The update matters because some farmers may be able to apply for a future SFI26 agreement that starts after their existing soon-to-expire agreement has ended. That could help avoid overlap problems and allow land currently covered by an HLS, Countryside Stewardship or other ELM revenue agreement to be included in a later SFI26 application.
For small farms that qualify for Window 1 but also have an existing ELM revenue agreement ending by February 2027, the choice may not be straightforward. Defra says some farmers in this position may prefer to wait for Window 2, when the new functionality is expected to be available.
SFI26 Window 2 expected to open in September 2026
Window 2 of SFI26 is expected to open in September 2026. It will be open to all farmers and land managers who are registered with the Rural Payments Agency and have a Single Business Identifier at the point of application.
Applicants must also have at least 3 hectares of eligible agricultural land linked to that SBI. This wider second window includes farmers with existing ELM revenue agreements approaching expiry, including HLS agreements under Environmental Stewardship.
The full official scheme rules are available on GOV.UK’s SFI26 scheme rules and guidance, which should be checked before making any application decision.
Why HLS agreement holders need to check timing
The key issue is whether land is already covered by an existing ELM revenue agreement. Defra’s guidance makes clear that the new functionality will allow SFI26 agreements to start after the relevant soon-to-expire agreement has ended.
This is important for farmers whose HLS or other ELM revenue agreements are due to end soon. Without the new application route, some applicants may not be able to include all the land they want in an SFI26 agreement at the time they first apply.
Farmers with agreements expiring at the end of March 2027 or later may be able to apply for a future SFI offer. Defra says the timing of the SFI27 offer will be announced in due course.
Small farms may need to choose between Window 1 and Window 2
Small farms are among the groups eligible for Window 1. However, some small farms also have an existing ELM revenue agreement that is due to expire by the end of February 2027.
In that situation, Defra has indicated that farmers may prefer to wait until Window 2. The reason is that Window 2 should allow them to apply for the full SFI26 offer across land currently covered by their existing agreement, although their SFI26 agreement would start later.
This creates a practical decision for farm businesses. Applying earlier may bring access to SFI26 sooner, but waiting could make it possible to include more land in the new agreement once the existing agreement ends.
SFI26 budget set at £240 million
SFI26 has a total budget of £240 million for new agreements across Window 1 and Window 2 in the financial year up to March 2027.
Up to £60 million has been allocated to Window 1. Any funding not allocated through Window 1 will be available to applicants in Window 2.
Defra has said it cannot set a fixed end date for Window 1 at this stage because the closing point will depend on how many farmers apply. That means eligible farmers should avoid assuming Window 1 will remain open for a specific period.
Who is eligible for Window 2?
Window 2 is designed to be broader than Window 1. It will be available to all farmers and land managers who meet the basic entry requirements.
To apply in Window 2, a farm business must be registered with the Rural Payments Agency, have a Single Business Identifier and have at least 3 hectares of eligible agricultural land linked to that SBI.
This includes farmers with existing ELM revenue agreements approaching expiry, which is why the window is especially relevant for HLS agreement holders and others still managing land under older stewardship arrangements.
Watch the SFI26 webinar
Defra and the Farming Advice Service have also provided an SFI26 webinar for farmers and land managers who want a clearer explanation of the scheme and application process.
What farmers should check before applying
Before choosing whether to apply in Window 1 or wait for Window 2, farmers should check the expiry date of any existing HLS, Countryside Stewardship, Sustainable Farming Incentive or other ELM revenue agreement.
They should also review which parcels of land are currently covered by an existing agreement and whether those areas are needed for their preferred SFI26 actions.
For farmers following wider rural funding changes, our guide to latest UK policy updates may help track related scheme announcements and application deadlines.
Why the update matters now
The SFI26 update is not only about a new application window. It affects business planning, cash flow and land management decisions for farms moving from older stewardship agreements into the newer Sustainable Farming Incentive structure.
For some HLS agreement holders, waiting until September 2026 may provide a better route into SFI26 because it could allow more land to be included once the existing agreement is close to ending.
However, waiting may also mean a later SFI26 start date. That is why the most important step for farmers is to compare their agreement expiry date, eligible land area and preferred SFI26 actions before deciding when to apply.
The safest approach is to check the latest GOV.UK guidance, review the SFI26 webinar and seek advice if the farm has overlapping agreements or land parcels with different scheme histories.
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