Farm income figures for NI highlight input cost woes

Farm incomes in Northern Ireland (NI) are forecast to rise by an average of 16% in 2021/22, according to provisional figures from the Department of Agriculture, Environment and Rural Affairs (Daera).

The income figures are based on surveys of farm businesses with an average accounting year end date of mid-February.

Meanwhile the department estimates that Total Income from Farming (TIFF) rose from £463m in 2020 to £501m in 2021.

The increase comes largely off the back of higher commodity prices, with the total value of field crops up by 34% and the average farmgate milk price up 16% compared with the previous year.

See also: Defra revises 2020 stats on better diversification earnings

Looking at a farm level, farm business income (FBI) across all farm types is expected to increase from an average of £34,402 in 2020/21 to £39,741 in 2021/22, which equates to an increase of £5,339 or 16% a farm.

However, there is a big difference between sectors, with pig farmers looking at an estimated 56% drop in farm incomes, rather than a rise, due to lower pigmeat prices and higher feed costs.

FBI tends to be used as a proxy for net profit as it is the return associated with all unpaid labour (farmer, spouses and any others with an entrepreneurial interest in the business) and to the capital invested in the farm business which includes land and business.

Arable

The biggest increase in incomes is forecast in the cereals sector, suggesting an increase of 78%, from £33,514 in 2020/21 to £59,564 in 2021/22.

This upturn is largely explained by the higher grain prices seen over the past year, coupled with yield increases.

Livestock sector

While livestock farmers saw average farmgate beef prices up 11% and sheep prices up 18%, farm incomes showed little change due to the impact of higher input costs.

Incomes on Less Favoured Area (LFA) units are forecast to have risen by 4% from £20,454 in 2020/21 to £21,181 in 2021/22, while incomes for lowland livestock farmers are estimated to have dropped by 2%.

Dairy income

Dairy farms are forecast to see average income rise by 31%, from £62,758 to £82,490 in 2021/22, based on an average farmgate milk price of 31.53p/litre and a 3% increase in milk production.

Farm minister Edwin Poots said the rise in incomes was welcome, but he was concerned by the continuing hikes in input costs, particularly given the impact it was having on the pig sector.

“Farm level estimates show that not all farm types experienced an increase in incomes in 2021.

“In particular, the incomes of pig farms are substantially down due to lower pigmeat prices and much higher feed costs during 2021.

“Like all farm sectors, the pig sector has faced market fluctuations before, but the combination of both lower prices and rising costs has been very testing and I have been working with the sector closely and continue to monitor the situation.”