Total farming income in the UK fell by 24 per cent last year – the largest drop for 15 years – according to latest figures from the UK Department for Environment, Food & Rural Affairs.
Across the country, the total income from farming fell by £1.2 billion between 2014 and 2015 to £4bn, according to the second round of estimated figures, included in the latest report drawn together by the Office for National Statistics.
The fall was driven by lower commodity prices and reduced direct payments resulting from the less favourable euro/sterling exchange rate. Gross value added at basic price – a measure of the industry’s contribution to the country’s gross domestic product – fell by £1.1bn to £8.7bn, an 11 per cent fall in real terms.
The report indicated that the overall output of the cropping sector fell by £704 million to £8.5bn, a fall of 7.7 per cent, with most crops seeing falls with the exception of oilseeds, protein crops and fruit and vegetables.
The report said that while 2015 had been a good year for crop production, lower prices and increased supplies had driven farmgate prices down.
The total value of livestock output was 8.5 per cent lower at £13.1bn. In 2015 all livestock values were lower than 2014 – with the exception of cattle – and the report noted a particular fall in the value of milk produced during the year.
The strengthening of the pound against the euro in 2015 not only encouraged more food to be imported but also lowered the price paid in sterling for global commodities.
This factor also led to a reduction in the value of support payments to farmers, with the net value of basic payments (formerly single farm payments) 6.5 per cent lower for the 2015 year than they had been in 2014.
• The delays in these support payments to farmers in Scotland due to the failings of the new IT system saw the vast majority of producers having to wait until well into 2016 to receive partial payments – and while many had to wait until the end of June for final payment, a number are still awaiting these funds.
However, this week saw the Scottish Government begin to provide producers with official details on the breakdown of these payments – more than a year after they would normally have been expected.
A spokesman for NFU Scotland said that, while the letters were “long overdue”, the move would finally give farmers the opportunity to check how their payments had been calculated and to make sure they met with their expectations.