05 June 1998
Surveys reveal full extent of farming slump
By Allan Wright
TWO surveys by the Scottish Agricultural College in southern Scotland have highlighted the scale of the downturn in farmings fortunes.
Two further studies in other areas are expected to show similar results, as is a survey of its entire membership by the Scottish NFU to be published on 15 June.
“The common theme is that farm incomes have collapsed with turnover down at least 30%,” said SNFU president, George Lyon.
“There is a complete lack of confidence about the future, not just among farmers but among those in all the ancillary businesses. What is unique is that the collapse has been across all sectors. That has never been seen before.
“There is a growing realisation that this is the worst and deepest crisis the industry has ever faced,” he added.
The college survey in Dumfries and Galloway was translated into two models.
The first, for 100 beef cows and 700 ewes on 243ha (600 acres), showed a margin before rent, interest, and personal drawings of less than £12,000 for this year compared with £37,500 in 1995. The forecast figure for 2003 was £24,600.
The model for a dairy farm with 100 cows on 101ha (250 acres) indicated a 1995 margin of £44,500 falling to £16,000 this year and recovering only to £19,000 by 2003.
But 96% of all respondents said they would continue to farm for the next five years. Most dairy farmers planned to expand to survive, but many beef units were planning to cut cow numbers and finish more animals instead of selling them as stores. Sheep farmers also indicated a move to finishing more animals, but without cutting ewe numbers.
A similar survey of 1300 farms in the Borders also suggested that beef cow numbers will be cut. Less than 20% were planning radical agricultural diversification. But 60% of farming families in Dumfries and Galloway and almost half those in the Borders were relying on off-farm income for part of their income.
In Dumfries and Galloway, 15% of respondents earned more than half their income from non-farming activities. n
For this and other stories, see Farmers Weekly, 5-11 June, 1998