Incomes 'not reflecting agriculture's contribution'

Agriculture's contribution to the national economy continued to grow last year, but the NFU of England and Wales has pointed out the bottom financial line for farmers is not so rosy.

New figures published by Defra this week show that UK farming is playing an important part in stabilising the economy, contributing 7.2 billion in 2010, a 6.2 per cent year-on-year increase for its gross value added.

The total value of UK agricultural production also remains buoyant, with 20.7bn estimated gross output last year, 5.3 per cent up on 2009 levels. Increases in the value of production from oilseeds, poultry and milk were among the factors contributing to overall output growth. However, the English Union warned that, while farming's importance to the economy should not be underestimated, the bottom line for farm incomes is not so positive.

Aggregate figures for 2010 show a 4.3 per cent drop in total farm incomes, with rising input costs and a lower level of direct support, due to exchange rates, being blamed for more than offsetting the increases in the value from agriculture production.

Union chief economist Phil Bicknell said: "Agriculture has been inevitably linked with headlines focusing on booming global commodity prices and rapid food inflation. However, these latest statistics show that the world market peaks aren't being seen at a UK farm level."