Income figures highlight CAP's vital role

Financial services companies took the biggest hit as the cost of fraud to the UK economy soared past £38 billion last year.

Government estimates of the financial health of Scottish agriculture in 2010 published yesterday showed a slight improvement with the total income from farming being put at 618 million.

The overall gross output last year from Scottish agriculture was estimated to be 2.425 billion, an increase of 4.7 per cent on the previous year and, without taking inflation into account, the highest output figure ever recorded.

However, NFU Scotland said that figure once again highlighted the continued importance of farm support to the sector, with 597m coming into the industry in subsidies, most of this cash coming through the CAP.

The union's policy director Scott Walker reckoned the latest figures showed how essential money from the CAP was for the survival and wellbeing of farm businesses in Scotland.

"That must be borne in mind when politicians begin to thrash out a deal on CAP Reform in the coming months and years," he said. Cabinet secretary for rural affairs Richard Lochhead welcomed the 25 per cent year on year increase in the TIFF figures especially as they came in "tough economic conditions".

He agreed with the union stance on the importance of retaining direct support payments for farmers and said that any change in the CAP had "to fully reflect and support the challenges faced by farmers on the geographic peripheries of Europe".

The figures show increased outputs in all the arable crops, with barley some 30 per cent above last year's figures when prices were depressed. The output of wheat rose an estimated 40 per cent on the previous year with the increase being due to both better prices and increased area of crop.

Livestock figures were also mostly above last year's level although much of the increase was in the sheep sector where the statisticians show an increase of 5 per cent in the value of finished lambs and a 33 per cent increase in the value of store lambs.

Output of milk from the dairy sector was put at 271m, a figure similar to last year's value.

The valuation of Scottish fruit sold last year shows drop of 17 per cent mainly due to a reduction in the market price of strawberries.

On the input side, last year the big change in costs came in fertilisers where expenditure fell by 40 per cent to 292m but his follows a two-year period when a bigger increase in price took place.

Feeding stuffs, fuel and veterinary costs all rose by double-digit percentages.

But all the figures produced yesterday came with a government health warning that they were the best estimates of the state of the industry.

The government also produced financial data from a sample of 484 farms throughout Scotland covering all main type of agriculture.This data is based on balance sheets produced between November 2009 and May 2010 relating to the state of the businesses 12 months prior to that.

These show cereal farmers in the doldrums and livestock farmers making some cash.

Cattle and sheep farms in less favoured areas saw an average income of 44,390 while specialist grain growers averaged 16,690

Dairy farmers saw a drop in their income from 78,446 to 58,746, a fall of almost 20,000.

Over the whole 484 farms in the survey, average income was 34,366.