Livestock farmers need £100,000 to support families, study claims

Livestock farms need a gross annual output of at least £100,000 to support a family, a study of livestock farmer’s profits has claimed.

The annual survey, by chartered accountants Dodd & Co of their clients across Cumbria and Scotland, said livestock farmers recorded an average output of just £83,176 in the year ended June 2006.

The bottom 25% of those surveyed made an average output of just £43,952.

The report comes as a stark warning for livestock producers, who made average profits of £7461, down from £8042 in the same period last year.

About 70% of the 50 farmers questioned made a profit, while 28% reported a loss.

However, when income from subsidies was discounted, only 19% of the farms would have made any profit.

Martin Hall, farming specialist at Dodd & Co, said the figures were expected to get worse next year as the Single Farm Payment is reduced further.

The study found large beef and sheep enterprises, particularly those taking part in stewardship schemes, made the most profit, while lowland beef farmers were least profitable.

“The bigger farms are more profitable because they make enough to cover their fixed costs. However, for small farms livestock farming should be a sideline,” Mr Hall said.

Many farms would even be financially better off if they claimed the payment and no longer farmed livestock, he added.

Robert Forster, National Beef Association chief executive, agreed that taking the SFP and moving away from livestock farming would be more profitable for some farmers.

“That’s the message we have been trying to get to retailers,” he said. “If they really want UK beef and a secure supply, then they have to pay enough for livestock farmers to stay in business.”