Farming Profits Forecast Down in 2018

UK Farmers are forecast to see lower profits in 2018, after spending nearly £1bn more on agricultural goods and services.

 

According to Defra’s first forecast of Total Income from Farming (TIFF) for 2018, an increase of 6% more has been spent on farming goods and services. It is likely that spending on farming goods and services will rise by £950m to £16.7bn in 2018.

 

Livestock farmers are likely to be hit that hardest, as the largest increase in spending was on animal feed – which rose by an estimated £600m. This rise will have come from the increased consumption of animal feeds, as winter feeding was prolonged due to the Beast from the East and the dry summer caused supplements to be fed. Crop prises have also risen, meaning that the prices of animal feeds have increased.

 

There have also been increases in fuel and fertiliser costs.

 

This year saw a 3% increase in the value of livestock output. However the higher costs and a 1% fall in the value of crop outputs is being forecast to cause a 15% decline in the TIFF value.

 

Defra have suggested that the decline will be near £860m, reducing the TIFF value to £4.85bn.

 

Last year, the TIFF value was at a four year high. This was due to rising incomes from milk, increased crop production and a high subsidy figure which outstripped a 4% rise in costs.