Farm borrowings up 5% on the year, figures show

Farm borrowings rose by 4.3% to £11.974bn in July this year compared with £11.482bn a year earlier.

This represents a £492m year-on-year increase. However, Lloyds TSB had seen an increase into double figures over the same period, said agriculture director Gareth Oakley.

Higher working capital requirements in the arable sector after lower grain prices last year accounted for some of the rise, he said.

There had also been some big loan applications from egg producers for investment and improvements, as well as a higher level of interest in robotics for dairy herds and in renewable energy projects.

Bank of England statistics show that farmers were using a higher proportion of the bank borrowing available to them in July this year. Those facilities grew by just 1.3% to £14.536bn in the year to July, of which farmers were using 82.4% against 80% at the same date in 2009.