To stay as profitable, farmers would have to have reduced input costs by 1 per cent per year since 1966
Commodity prices have not increased with the rate of inflation, but yields have risen across most areas in the last 50 years, according to the John Nix Farm Management Pocketbook, which celebrates its 50th Anniversary this year.
When the first edition was published in 1966, the milk price was 3.2ppl which has now increased to 22ppl and yields have doubled to 8,000 litres per cow.
Yields have also approximately doubled for wheat and oats, with wheat prices rising from £25/tonne to £130/t and oats from £27/t to £120/t.
In the beef and sheep sector yields have not substantially improved during the last 50 years. In 2016, the sheep sector was budgeted to finish 1.55 lambs per ewe, only 10 per cent higher than the 1.4 in 1966.
Similarly, the beef sector is still working on one finished cow per year. However, price per head has increased 13 fold from £85/head to £1100/head.
In order for a producer to have maintained the same profit they did in 1966, they would have had to make efficiency savings of approximately 50 per cent.
Graham Redman, author of the Pocketbook said: "If a farm has become more efficient in the way it farms, by 1 percent per year, over 50 years, then in simple terms it will still be as profitable before subsidy as it was in 1966.
"However, some costs have risen sharply as they were barely used in 1966 such as agrochemicals, and others, such as seed costs have risen by proportionately less."