'Extremely concerned': Scotland farm incomes record sharp 50% fall

At £35,500 for the average farm, income is at its lowest level since 2019/20, officials said.

Farm incomes in Scotland have declined by more than half in the past year, figures have revealed.

The average farm income across the country - a measure of farm profit after costs - fell by 51 per cent from the record highs in the year 2022 to 2023.

Farm incomes have fallen to their lowest level since 2019/20. Picture: Lisa Ferguson/The Scotsman

The data, released by the Scottish Government, showed the average farm income sits at £35,500, which officials said is its lowest level since 2019/20.

Leading agriculture charity RSABI said financial worries were one of the main reasons people in Scottish agriculture seek help.

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Falls in cereal and milk prices across the country led to particularly large drops in profits for arable and dairy farms, although the average income of these farms remains the highest across all farm types.

The data, however, showed a larger proportion of farms within these farm types are unprofitable compared to the previous year. In 2023/24, 31 per cent of cereal and dairy farms were loss-making.

Livestock farms, which make up 60 per cent of commercial farms, continue to make a loss on their agricultural activity on average. Lowland cattle and sheep farm income fell by 87 per cent, the largest drop in income across livestock farm types, largely driven by a decrease in livestock output.

The declining income has been attributed to three main factors. These include some agricultural output prices seeing a large drop following exceptionally high levels from the previous year, a decrease in outputs, and adverse weather conditions playing a role in impacting harvest and production.

While some input costs showed a modest decrease, costs did not fall at the same pace as output prices, putting additional pressure on profit margins for farmers, the government-data showed.

RSABI’s chief executive Carol McLaren said: “We know that many farmers are extremely concerned about the future, and the implications of changes to support and inheritance tax.

“Uncertainty and worry can drive people into a downward cycle and, at this time of year when farmers are working flat out with spring work, lack of sleep and exhaustion can add to the mix.”

She said the charity was working on spreading the message to take steps to prevent stress building up to a point where people are feeling overwhelmed.

Ms McLaren added: “We are urging farmers to remember take care of their mental and physical wellbeing and our #KeepTalking campaign is encouraging those in our farming communities to look out for others who may be feeling low or lonely.

“Our message is speak to someone if you are feeling low and please don’t hesitate to contact us – support is there.”

Alix Ritchie, of Farmstrong Scotland, a rural wellbeing programme for the farming and crofting sector, said: “The recent announcement about farm income highlights the importance of supporting our most important asset within agriculture - our people.

“We know from our own survey, published just this week, that our respondents reported a lower wellbeing than the Scottish population, with one third identifying low wellbeing. This will undoubtedly bring worry to many.”

The Scottish Government data was calculated from the 2023/24 Farm Business Survey, which covers the 2023 cropping year and the 2023/24 financial year. It involved a survey of about 400 commercial farms with economic activity of at least around £20,000.

Farms which do not receive support payments, such as pigs, poultry and horticulture, are not included in the survey.

Officials said trade disruption and tightening supplies following Russia’s invasion of Ukraine led to volatility and high cereal prices in 2022. Prices of commodities such as wheat stabilised somewhat during 2023.