Farm incomes lowest since the 1930s
By Shelley Wright
FARM incomes have plummeted to their lowest level in real terms since the 1930s, Government figures confirmed today. But farm leaders are increasingly optimistic the tide is slowly turning and recovery is on its way.
MAFF estimates of the total income from farming for 1998 show a 35% drop in real terms. In a separate set of figures, MAFF also announced that hill farming income was likely to fall 67% on last year. That would leave the average income for producers in less-favoured areas at just £2400.
NFU chief economist Sion Roberts said the average drop in real terms was 51% when family labour was taken into account.
“Over the past two years we have seen a drop of £3.5 billion in the value of the industrys output,” he said. “While this year we have seen a reduction in costs of things like feed, fertiliser and pesticides, the cost and volume of borrowing has increased. Labour costs have also risen and, with the strength of the Pound, we have also seen subsidy payments fall significantly.”
Mr Roberts said there were signs the timing of the recent £120 million Government aid package could mark the low point in the recession.
Optimism that things could get better from now was driven mainly by the 5% weakening in Sterling in the past six months, he said. The lifting of the beef ban should also mean some export revenue could boost incomes next year and there were signs that the depression in world commodity markets was easing.
Commenting on the hill income figures, NFU president Ben Gill said the average net income of upland farmers had fallen to only 16% of its value before the BSE crisis.
“It proves beyond a shadow of doubt the Governments recent aid package for hill farmers was an extremely necessary and timely measure which will have prevented many farm businesses from folding,” he said.
- Minister admits farm incomes are dire, FWi, yesterday (30 November, 1998)
- Government aid worth £119.3m – official, FWi, 16 November, 1998
- Farmers profits lowest since the 1930s, FWi, 09 October, 1998
- Survey shows no respite for farmers, FWi, 08 October, 1998