AGRICULTURE has been hit by the strong Pound more than most other industries. But few commentators have realised the full impact on farmers, according to a new report.
Sterlings strength has led to imports of French grain, cheap milk products, beef and pork, says Midland Agricultures annual guide for farmers, Forward Planning 1998. Imported fruit and vegetables from Spain and Italy are also major competitors to UK farming.
But overall, UK agriculture remains in reasonable shape and the future appears brighter, says Midland Agriculture director, Norman Coward.
“Next years crops are being produced at lower costs, the price of imported fertilisers and agrochemicals has fallen, and livestock are benefiting from lower feed costs,” he says. “The Pound is forecast to weaken a little later in 1998, which will help improve the outlook for farm income.”
Most farmers have done an excellent job in the past few years by reducing borrowings and replacing old equipment with newer, high-capacity machinery, Mr Coward adds.
But he warns that farmers will still have to adapt to lower margins. Good plans and forecasting will continue to be essential, but will be more difficult to produce for 1998 because prices remain volatile.