Income from farming revised up 6% for 2015

Defra has revised up by 6% its estimate of total income from farming (Tiff) for 2015.

The new figure of £4,003m compares with the original estimate in April of £3,769m, but is still a 24% (£1,247m) real-term drop compared with the previous year.

This was driven by lower commodity prices and reduced direct payments (down £140m to £2.8bn) as a result of changes in the exchange rate for BPS.

See also: Low prices wiped £1.5bn off farming incomes last year

There were big falls in the value of wheat, pigmeat and milk outputs and the reduction in income came despite lower costs in some important categories of input such as energy, animal feed and fertiliser.

  • UK farmers spent £1,386m on fertiliser in 2015, a drop of £80m on 2014 because of a lower planted area, changes between crops and lower oil prices.
  • Spending on energy fell by £197m to £1,202m, driven by the fall in global oil prices
  • Animal feed cost fell by £325m to £4,728m – a combination of lower grain prices and better grass growth and a season that allowed stock to stay out longer.
  • The farm wage bill in 2015 was £2,481m – a rise of £75m – because of higher wages and a rise in employee numbers.

Tiff for each annual work unit (AWU) of entrepreneurial labour (farmers and other unpaid labour) fell between 2014 and 2015 by 24% in real terms to £20,668.

Gross value added, which identifies agriculture’s contribution to gross domestic product (GDP), fell £1,129m to £8,704m. In real terms this was an 11% fall, but the revised figure is a slight improvement on April’s original estimate.

“Although the statistics show that productivity has increased, this is offset by market volatility,” said CLA senior business adviser Dr Charles Trotman.

“The figures highlight the need for economic certainty and market security in agriculture as we move towards leaving the EU. Post-Brexit it is vital that farmers have improved resilience in the sector to avoid further harm to the rural economy.”

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