Farm incomes drop 29% in 2015

Defra’s first estimates of the UK’s Total Income From Farming (TIFF) in 2015 point to a 29% drop compared to the previous year. Output was down across both the livestock and crop sectors, while all categories of farm input also saw reduced expenditure.

 Source: Defra

Source: Defra

The 2015 TIFF estimate is £3.769 billion, a drop of £1.526bn on the £5.295bn measured for 2014. The reduction is attributed to lower farm commodity prices as well as the effect of the €:£ exchange rate which reduced the value of CAP support payments by 7.5%. The sharp drop also reflects a TIFF recovery in 2014.

Total crop output in 2015 is put at £8.474bn, an 8.1 % fall from the £9.24bn in 2014. The output of all arable crops was down save for oilseed rape at £715 million (701m) and protein crops at £137m (£123m). Fresh vegetables were slightly higher at £1.263 (£1.218bn).The report says good arable crop growing weather led to a second year of good yields, particularly for cereals, with prices depressed by high stocks.

Overall livestock output at £13.006bn was 9.3% down from the £14.361bn in the previous year, with beef cattle the only meat species category to show an increase to £2.739bn (£2.616bn). Eggs were unchanged at £681m, while milk output fell £940m to £3.66bn.

The value of animal feeds supplied fell by £201m to £4.864bn, as volumes fell 9.0% with the good weather promoting longer grazing and more forage, while lower feed material prices saw prices fall by 10%.

Total fertiliser spending dropped by £114m to £1.353bn through a combination of a lower planted area and rotational changes – volumes were down by 2.3%, while lower energy costs reduced prices.

 Value of agricultural inputs 2015 (£million)

Hello, World!

Input category           & 2012  & 2013  & 2014  & 2015 
                         &       &       &       &       
Seeds                    & 772   & 885   & 770   & 707   
Fertilisers              & 1,585 & 1,542 & 1,469 & 1,353 
Crop Protection Products & 873   & 873   & 945   & 907  
Animal feed -total       & 5,091 & 5,677 & 5,074 & 4,864
-compounds               & 2,994 & 3,357 & 3,005 & 2,845
-straights               & 1,508 & 1,606 & 1,417 & 1,294
- on farm feed           & 589   & 714   & 652   & 725 
Veterinary costs         & 438   & 456   & 458   & 458   
Energy                   & 1,488 & 1,480 & 1,399 & 1,182 \\
Agricultural Services    & 1,057 & 1,074 & 1,124 & 1,132

 

 

The NFU says the fall in TIFF is the biggest year-on-year fall since the millennium. Farm profitability is now at its lowest level since 2007, highlighting the cash flow crisis facing the industry.

 “These alarming figures remind us that farmers up and down the country and across the majority of sectors are dealing with the impact of devastating cuts in the value of their products,” notes NFU chief economist Gail Soutar. “Lots of farm businesses find themselves in a loss-making situation. If prices and profitability don’t change, it is not just those farms that are at jeopardy, but our food processing sector, our rural communities and the environment. 

“We need everyone in the food supply chain to intensify their efforts to back British farmers -for example through longer term relationships that deliver some certainty on pricing and give farmers the confidence that food production can be profitable. And we need government to do all it can including making sure that farmers don’t face the same crippling delays to farm payments that they have in 2015, with immediate action for those still waiting for 2015 payments to arrive.”

Full report: www.gov.uk/government/statistics/total-income-from-farming-in-the-uk

Posted on May 9, 2016 and filed under Top Story, UK Policy & Regulation, News.