see also Barbarians at the barn: private equity sinks its teeth into agriculture also Cost-price imbalance takes toll on farm profits in 2023 and Dairy farming: private equity’s next cash cow?
Farm profits slumped by 19% in 2023, says Defra report
Eastern Daily Press 20th July 2024
Farm profitability fell by 19pc across the country last year, according to the latest government figures – illustrating the ongoing financial volatility in the sector.
Defra’s Total Income from Farming (TIFF) is a measure of the total profit from all UK farming businesses in a calendar year.
The figure for England in 2023 was £4.5bn, a fall of £1.1bn from 2022.
Defra says this decrease was mainly due to a 13.1pc fall in the value of crop outputs, which dropped by £1.5bn to £9.9bn.
“Low commodity prices combined with a poor yield resulted in substantial decreases in the value of many crop items, with wheat seeing the largest decrease at £1.2bn less than in 2022,” says the report.
These decreases follow a spike in 2022, when high global costs pushed up commodity prices due to the war in Ukraine.
Farming leaders said the latest statistics demonstrated the “volatile environment” in which food growers have been trying to make a living in recent years.
National Farmers’ Union (NFU) president Tom Bradshaw, who farms near Colchester, said: “We have moved from high commodity prices and soaring production costs in 2022 caused by the tragic situation in Ukraine, to much lower income figures in a weather-affected 2023, as commodity prices fell but production costs remained high.”
He added that, since the survey ended, farmers have been struggling with record levels of rain and flooding which has contributed to a “huge drop in confidence among farmers and put a real question mark over this year’s harvest”.
“While farmers are well used to dealing with variation year on year, the volatility we’ve seen in the last few years isn’t sustainable,” he said.
“Food security is national security, and that’s why we need the new government to be prioritising food production in its policy-making.”
Defra’s figures show agriculture’s overall contribution to England’s economy also dipped by £1bn to £10bn last year, an 8.7pc fall compared with 2022.
Total livestock output in 2023 remained at £12.4bn, but there was a small increase in income from diversification, which rose from £1.321bn to £1.393bn.
