Farm support funds keep producers in the black

While official figures released yesterday showed that average farm incomes for 2016/17 had risen 94% on the year, the hourly earnings of more than 45% of farmers still stood below the national minimum wage.

Providing some context for the latest round of statistics released by the Scottish Government for Farm Business Income, NFU Scotland chief executive, Scott Walker added that without farm support measures many more farms would be in the situation where they were making a loss.

“Until we can address the inequalities in the supply chain, Government support for the industry remains essential and must not be threatened due to Brexit,” said Walker.

“We have the ambition to double the size of the food and drinks sector in Scotland by 2030 but if all are to benefit from this we will need to radically rethink the supply chain so that the hard work of farmers and their families is valued, and that a fair sustainable price is paid for what they produce,” he said.

But despite what appeared to be a near doubling of income levels, the figure stood against a backdrop of sharp declines in recent years.

The statistics confirmed that this was the first rise in incomes which had fallen by 46% since 2011 – and had simply returned the figures to those which had been achieved in 2014.

The latest figures were published by Scotland’s chief statistician and were based on annual audits of nearly 500 commercial farms in Scotland, looking at the financial health of the farm using the farm’s accounts during the 2016 crop year.

The report showed that the improvements came from lower input costs during the year boosted by better commodity and support prices.

These had both been boosted primarily by a decrease in the value of sterling.

However, despite the upturn in traditional farming enterprises, the figures showed that farmers who had expanded outside traditional work had done better than those that had not.

Diversification into other areas included renting out holiday homes or building small windfarms to generate electricity.

While all farm types showed improved incomes, high prices for potatoes and milk during that year had seen general cropping farms and dairy units head the league table of farm incomes.

NFU Scotland chief executive Scott Walker says Government support for the industry remains essential.