English farm profits up by 15% in 2019, says Defra

Farm profits in England rose by 15% to £534m during 2019 as ideal growing conditions boosted arable yields and input usage dropped, Defra figures show.

Defra’s estimates suggest England’s Total Income from Farming (Tiff) – business profits and remuneration for work done by business owners – rose to £4bn. The figure includes subsidy income of £2.1bn.

The department also revealed that agriculture’s gross added value (output, less inputs) for the 12 months was £8.1bn.

That represents an increase of £678m, or 9%, on the previous year.

See also: Natural capital: What it is and how to value it on your farm

The extra value contributed was on the back of increases in total output – up by £572m (3%) to £20.3bn.

This was driven largely by increases in arable yields, particularly cereals.

The calculation is Defra’s first official regional estimate of farming’s contribution to the economy in 2019 after making an initial UK-wide projection in December.

Arable

Overall, the output of crops value rose by £437m, or 5.4%, to £8.5bn.

Broken down, the main contributor to the rise in the output value was wheat – up by £306m, or 16%, to £2.3bn.

This was due largely to the conditions and a 3.6% increase in the area grown.

Barley growing saw a 2.1% increase in output, up £15m to £693m, while potato output rose by £154m, and the combined vegetable, horticulture and fruit sectors contributed £166m more than the previous year.

In contrast, oilseed rape output fell by 11% (£66m) to £544m on the back of the lowest area planted since 2004.

The 9.7% fall in area grown was down to the ban on neonicotinoids and several years of poor growing conditions.

Livestock

Overall, the value of total livestock output increased by £99m, up 1.0% to £9.7bn.

The pig and sheep sectors contributed gains, but the cattle industry output fell.

Pigmeat showed the largest annual percentage increase with a rise in value of £37m, up 3.7% to £1.0bn.

This was due to increased production and slightly higher prices as China’s African swine fever crisis started to have an influence.

Sheepmeat values rose 3.3% to £695m, driven by higher production levels.

Beef, however, fell by £94m, down 6.6% to £1.3bn.

Milk contributed the largest output values across the livestock sector at £2.9bn, up £22m, or 0.8%, with higher production outweighing price cuts.

Inputs

While the total cost of goods and services consumed in the production process fell by £106m to £12.2bn, this was generally due to lower usage, Defra reported.

For example, animal feed use costs dropped by £72m to £3.6bn as higher supplies of cheaper grass and forage reduced the need for concentrates.

The dry spring also saw lower weed pressure, which reduced the need for crop protection.

In contrast, later in the year, wet conditions reduced access to fields and spray applications were reduced further.

Across the seasons, the reduction in crop protection saw costs fall sharply by £101m to £767m.

Lack of access to fields also cut drilling activity and seed costs were reduced by £31m to £637m.

However, higher oil prices pushed up fertiliser and energy costs despite lower usage.

Fertiliser costs rose by £11m to £919m, while energy was up £8m to £1bn.

England’s contribution

England is the largest contributor to the UK’s 2019 Tiff figure, estimated at £5.3bn.

Farmers in England contributed 75% of the total, Scotland 14% and Northern Ireland and Wales 5% each.

A complete set of the figures can be found on the Defra website [PDF].

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