Farmer confidence needs boost for investments to flow

Rising input prices and red tape are damaging short-term confidence in agriculture, but farmers remain cautiously optimistic about farming’s longer-term prospects, a survey has revealed.

The Confidence Survey 2010, carried out by the NFU, showed farmers were concerned about the next 12 months in agriculture.

NFU head of economics Tom Hind warned that could have an impact on farmers making the investments required for a thriving food and farming sector.

“There are some concerns that general levels of confidence are not high enough to provide the necessary encouragement for farmers to invest financially in their businesses.

“There are particular concerns about lower confidence levels among livestock farmers,” Mr Hind added.

“Investment will be absolutely essential, not only to meet regulatory demands, but especially to secure a more competitive productive sector long-term.”

The survey results show that investment will be driven in the main by larger-scale farming businesses, especially those over 200 hectares.

“Economies of scale are a key part of business competitiveness,” Mr Hind said.

“But we should not ignore the importance of smaller and medium-sized enterprises which underpin the fabric of British agriculture and the wider upstream and downstream industries that it supports,” he said.

Despite the short-term worries Mr Hind said he was encouraged by farmers’ hopes for the medium-term future.

“Thirty-eight per cent are more confident about the future. Above all, they demonstrate a high level of commitment to individual businesses.

“Almost 40% believed they would be in operation for more than 21 years. This is testimony to both the resilience of farmers and also the historical and family legacy attached to many businesses,” Mr Hind said.

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