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Arable farms hit hardest by rising input prices

But the retail price of bread and margarine has fallen


Alex   Black

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Alex   Black
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Arable farms hit hardest by rising input prices #clubhectare

Cereal and oilseed rape growers have been hardest hit by rising inflation costs but retail costs of bread and margarine have fallen, according to the Anglia Farmers (AF) AgInflation Index.

 

While cereal and OSR farmers saw the highest increases, farmers have felt the pressure of rising input costs across all sectors.

 

Retail

 

Input costs increased by 4.81 per cent, but the Retail Price Index (RPI) showed the cost of bread and margarine had decreased by 4.4 per cent.


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The increased input costs were driven by rising fuel costs but inflation increased across most sectors including animal feed and medicine, seed and labour costs. Only agrochemicals saw deflation, at 0.28 per cent.

 

AF chief executive, Jon Duffy, said: “Fuel is clearly driving the increase in the AF AgInflation Index with the 4.06 per cent increase in inflation between September last year and February this year.”

 

Oil price

 

Brent crude oil has increased from $46 per barrel to $54 per barrel coupled with the devaluation of the pound against the dollar.

 

Mr Duffy encouraged farmers to utilise risk management schemes to help manage volatility.

In dairy, the cost of pasteurised milk has remained the same but dairy farmers have seen a 2.78 per cent increase in their production costs.


Mince and lamb prices have fallen by 0.1 per cent while farmers have been hit with a 2.71 per cent rise in production costs.


But for sugar beet, production costs have increased by 3.55 per cent compared to a 9.8 per cent increase in the cost of granulated sugar.

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