Sheep grazing next to solar panels© FLPA/Rex/Shutterstock

Almost two-thirds of farms in England have diversified into a non-agricultural business, generating a total of £620m in extra annual income, according to statistics released by Defra.

At 64% of farms canvassed in Defra’s Farm Business Survey 2016-17, the proportion of diversified farms had risen by 2% on the previous survey, carried out a year earlier.

See also: All you need to know about diversification

There are now 36,600 farms making a total of £620m from diversified activities which represents an 8% increase in income  from £580m in 2015-16.

Total diversification income accounted for almost a third (29%) of the £2,160m generated from all farming activity in England.

Varied income

On average each farm made £17,100 over the 12 months but the proportion of income varies widely from farm to farm, Defra pointed out.

For 41% of farms with a diversification, the revenue accounted for more than a quarter of their total income. And on 27% of the farms the diversified business contributed more than the core farming income itself.

The most common form of diversification uncovered by the survey was letting empty buildings for non-agricultural use. About 24,600 or 43% of all farms in England are engaged in the activity. This type of venture also brought in the highest average extra income of £17,900 for each farm.

Energy

The next most popular non-farming business was solar energy.

More than 11,000 farms, about one-in-five, generated electricity from solar energy. But in terms of income it contributed the lowest amount (£2,400 per farm) of all diversification types.  

However, when diversification is compared in terms of output, rather than income, the total contribution is less impressive.

Overall the output of non-agricultural business on farms was £1.19bn only 8% of England’s total farming production which stands at £15.67bn.

Measured in terms of output per farm, processing and retailing ranked highest with an average of £27,900 per farm, above lettings at £24,600.

Income from diversified enterprises —England 2016-17

 

No of farms

Percentage of farms

Total farm business income £m

Income from diversified business £m

Average enterprise income £/farm

Diversified enterprises

(all kinds)

36,600

64%

1,690

620

17,100

Letting buildings for non-farming

24,600 

43%

1,330

440                      

17,900

Processing/retailing of farm produce

5,200

9%

170

50

9,700

Sport and recreation

7,200

13%

360

30

3,600

Tourist accommodation and catering

3,400

6%

150

20

7,000

Solar energy

11,100

20%

620

30

2,400

Other renewable energy

5,200

9%

300

20

4,600

Other diversified activities

4,700

8%

250

30

6,900

Source: Farm Business Survey, England

Increasing number of farms with a diversification enterprise

2010-11

52%

2011-12

53%

2012-13 

56%

2013-14 

58%

2014-15 

61%

2015-16

62%

2016-17 

64%

Diversification defined

Defra’s survey excluded any agricultural enterprise even if it was a contracting venture carrying out work for other farmers. Instead its definition was any non-agricultural work carried out on- or off-farm that made use of the farm’s resources.