Farm Incomes 2013/14

Livestock farmers have seen higher profits over the last twelve months, whilst the fortunes of cropping businesses have generally declined.  These results come from the latest Farm Business Income (FBI) figures released by DEFRA.  They are only provisional at present, so could yet change, but they do correspond to what we would expect.  The data covers the 2013/14 year (which runs approximately from Feb to Feb) and so covers the 2013 harvest and Single Payment year. 

The chart below shows graphically the performance of the average business in seven sectors of UK agriculture.  FBI is the return to all unpaid labour and on the capital invested in the business.  There are no imputed rental charges or a cost for proprietors’ manual labour so FBI can be thought of as the real-world profit for these businesses.  Very small, part time, farms are excluded from the sample. 

In real terms incomes on Cereals farms is forecast to have fallen by 29% between 2012/13 and 2014/15.  On General Cropping farms the drop was 10%.  The fall was down to the well-documented problems of establishing crops in the autumn of 2012 for harvest 2013.  Also cereals prices were lower year-on-year.  The fall in profits on General Cropping farms was not as large as the potato and sugar beet enterprises partially offset lower cereals profitability.

Dairy incomes nearly doubled in the year – rising 92% in real terms (albeit from a pretty low base in 2012/13).  This was largely due to better milk prices.  The Grazing Livestock categories also showed an increase in returns, with lowland and LFA farms rising 12% and 30% respectively.  Better output from sheep flocks was the main factor; partially this was due to lambs being marketed that had been held over from the previous year.  In the intensive livestock sectors it stated that itis output gains (mainly price increases) that have driven the rise in profits rather than a fall in feed costs.

FARM BUSINESS INCOME (ENGLAND), Real Terms (2012/13 prices) – Source: DEFRA