Farmers optimistic overall, but dairy sector struggling

Farmers south of the border are planning to increase production and invest in the future, according to a new survey published by the National Farmers Union for England and Wales.

Confidence among farmers is reported to be rising, with many talking positively about the future and looking to increase production in the next five years.

Renewed confidence across the various sectors of farming is mirrored with an increase in profits for around 20 per cent of businesses compared with 13 per cent last year.

However, a significant proportion of the farmers questioned are still seeing profits decline, with almost 30 per cent reporting a worsening situation or fears about the survival of their businesses in the future.

Dairying is one of the worst affected sectors, with 42 per cent of the farmers surveyed reporting a decline in profitability and concerns about long-term survival – up from 25 per cent in 2010.

NFU policy director Martin Haworth said: “The results from the dairy sector are not surprising and validate our repeated calls for the recent rise in the milk price to be shared across the supply chain, with only 9.6 per cent of dairy farmers seeing a positive impact on their bottom line.

“The fact UK dairy farmers are languishing around the bottom of the EU milk price league table is lamentable. Efforts need to be doubled to agree a voluntary code of best practice for contracts to safeguard the future for many British dairy farmers.”

In the beef and sheep sector, where profitability has been historically low, the survey points to rising confidence.

However, Haworth suggested this was linked to headline prices and warned that profitability expectations show that confidence remains fragile.

Across the board, half of farmers are looking to increase production in the next five years, which is up from 35 per cent last year.

“This is a clear signal that farmers are looking to invest in their business for the long term,” said Haworth.