By Robert Harris

RETURNS from core farming activities on arable farms in the south of England have plunged into the red, according to the latest survey from accountant and business adviser Tenon Rural Services.

2000 harvest year results
/ha 2000 1999
Arable gross margin 455 497
Livestock gross margin 782 959
Farm gross margin 515 570
Other income 157 166
  672 736
Labour 215 210
Power/machinery 198 195
Property/administration 138 145
  551 550
Net farm income (before rent & finance) 121 186
Rent & finance 114 106
Overheads 7 80

The survey covered 20,240ha (50,000 acres) of mainly arable, and arable and dairy enterprises in the year to June 2001.

It shows net farm income fell to -36/ha (-15/acre) before rent and finance, and slumped to -150/ha (-61/acre) when those charges were included in the accounts.

Diversification, including rental and contracting, earned an average of 157/ha (64/acre), pulling the bottom line back into the black, but only just.

“The figures clearly show other incomes are supporting traditional farming,” said Tenon agriculture manager Martin Rossiter.

“Achieving a return is very difficult for those who have no alternative income and are paying finance and rent.”

Separating dairy and arable results shows those with milk income had a better year.

Average net farm income before rent and finance was 150/ha (61/acre) compared with a pure arable result of 103/ha (42/acre).

Rising arable returns from better prices could boost performance this year, believes Mr Rossiter.