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Scottish farm incomes boosted by milk and barley returns

NFUS attributed the rise to the exchange rate or increased yields, not improved headline prices


Alex   Black

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Alex   Black
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Scottish farm incomes boosted by milk and barley returns

Improved milk prices and increased barley production have boosted the Total Income From Farming (TIFF) in Scotland by £245 million to £917m in 2017.

 

But NFU Scotland said many of the gains were a result of exchange rates or increased yields rather than improved headline prices.

 

Fuel, labour and feed price increases bumped input costs up by 7 per cent in 2017.

Subsidies were also up £43m in 2017, at £544m.

Cereals

Barley ↑

  • £253m

Wheat ↑

  • £128m

 

Combinable crops committee chairman Ian Sands said the improvement in grain prices had been counteracted by large increases in the price of fuel, fertiliser and machinery.

 

“Add to this the difficult harvest, with increased drying costs and the fact that, in some areas, harvest and straw baling could not be completed because of the weather.

 

“Problems encountered by growers in 2017 will carry on into 2018, as a great number of Scottish farmers failed to plant their intended winter crops last autumn and this will have a knock on effect for 2018 harvest.”

 

Cereals and oilseeds rises also came after four years of falls, with the long-term pattern showing a near 40 per cent drop since the mid-1990s.

Livestock

Beef ↑

  • £716m

Sheep ↑

  • £222m

Pigs ↑

  • £108m

Poultry ↓

  • £80m

 

NFUS livestock committee chairman Charlie Adam said the continued weakness of sterling had boosted output prices, but also increased some input costs.

 

“Uncertainty continues over access to vital markets after Brexit, meaning any sense of security from recent rises will be limited”, he added.

 

Mr Adam also explained there would be greater demand for traditional farm inputs from biomass burners and anaerobic digester (AD) plants.

 

“Combined with the continued hangover from a very wet summer in 2017, this means input prices are likely to be high and unpredictable in the coming months”, he said.

Other crops

Potatoes ↑

  • £215m

Vegetables ↑

  • £155m

Fruit ↓

  • £134m

 

For potatoes, it was the second year of growth but policy manager Peter Loggie highlighted incomes were still below where they were four years ago.

 

“Vegetables, by comparison, have shown a bigger rise, to a new income high”, he said.

 

“This sector has shown encouraging long-term growth, primarily on the back of increased planted area.”

 

Labour costs were likely to be the cause of a fall in soft fruit incomes, with a second year drop coming after a decade of growth.

Dairy

Milk ↑

  • £434m

 

For milk, policy manager George Jamieson said the increase was a reflection of very poor incomes over the past two years.

 

“The huge variation in dairy output indicated by the statistics very clearly emphasises the huge challenge arising from volatile dairy commodity prices,” he added.

 

He highlighted milk prices were now falling again and costs had increased year-on-year.

 

“Dairy is a high cost, high risk sector, with the average dairy farmer spending around £450K each year on costs, before they make penny.”

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