British farmers suffered an even bigger blow to their finances last year than first thought, according to drastically revised figures.
Defra has published fresh estimates which show total income from farming (Tiff) in the UK fell 7.5% to £3.61bn, after accounting for inflation.
This is a sharp revision to the 1.5% drop from 2015 to 2016 reported a month ago, a mistake the government blamed on wrong data initially being used for vegetables, fruit and milk.
The overall story remains the same, with lower production and prices for cereals growers and dairy farmers driving an overall slump in the value of UK produce.
In the new figures, total output was worth £23.15bn last year – 5% less than in 2015. The first estimate pegged output £399m higher.
Last month, Richard King, Andersons head of business research, told Farmers Weekly he had expected output to be higher than Defra’s numbers showed.
After seeing the new estimates Mr King said he was even more surprised.
“Things improved from the middle of the onwards,” he said.
“It was not a full year of better prices and there were problems in the dairy sector and cereals output was down, but it was not quite as bad [as the Tiff suggests].”
The main factors behind the falling income were drops in the value of British wheat by £426m, milk by £395m and oilseed rape by £170m.
There were brighter spots, with potatoes, beef, sheepmeat and pork all making bigger contributions.
Helped by the weaker pound, direct payments rose 11% to £3.15bn.
Costs dropped too: farmers spent 17% less on fertiliser and 4% less on animal feed.
These were not enough to offset the heavier slides in farmers’ market returns.
British farmers have seen overall income fall for four years running, but steadily recovering commodity markets could bring a turnaround in 2017.
“We have been surprised by the 2016,” Mr King said. “We would be increasingly surprised if 2017 does not show a significant improvement, if it carries on pretty much as it is.”
Tiff, which represents production from farming plus subsidies but after costs, is a proxy for profits returned to owners and other unpaid workers.
Diversification and on-farm processing is included if it cannot be separated from the main farm business, but asset values are not counted.