Farming in the Uplands - ARCHIVE: Defra

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Ev 74 Environment, Food and Rural Affairs Committee: Evidence Economics of Upland Farming 34. Incomes on upland farms, on average, have been consistently lower than for lowland farms. This is mainly due to the uplands having a larger proportion of grazing livestock (ie beef and sheep) farms. These tend to have lower incomes than farm types which occur more commonly in the lowlands, such as dairy, cereals and general cropping farms. The levels of income for grazing livestock farms are in fact very similar between the lowlands and the uplands, as Figure 5, below, shows. Figure 5 AVERAGE FARM BUSINESS INCOMES FOR SELECTED FARM TYPES (ENGLAND) £ per farm 80,000 60,000 40,000 20,000 0 2003/04 2004/05 2005/06 2006/07 2007/08 2008/09 2009/10 All farm types LFA Grazing livestock (LFA) Dairy (LFA) All farm types lowland Grazing livestock (lowland) Dairy (lowland) Note: The forecasts for 2009–10 are based on information available in early January 2010 for prices, animal populations, marketings, crop areas and yields. They are intended as a broad indication of how each farm type is expected to fare compared with 2008–09 and are therefore subject to revision. Detailed figures for all farm types and dairy farms split between LFA and lowland will be available in November 2010. The average FBI for all dairy farms is projected to fall by around 10% in 2009–10. Incomes for 2009–10 will be published on 28 October 2010. Source: Farm Business Survey, years ending in February. Farms (0.5 SLR. 35. So the principal issue is less one of the poor viability of upland farming as such, but more one of the economics of grazing livestock farming in general, the farming type which happens to be the most prevalent in the upland environment. 36. There is also a very wide range in incomes across upland farms. For example, in 2008–09, data from the Farm Business Survey in England showed that Farm Business Income on SDA (Severely Disadvantaged) farms in the LFA ranged from an average of—£40 per hectare in the bottom quartile, to £218 per hectare in the top quartile. These income levels include the Single Payment (of about £100 per EMBARGOED ADVANCE COPY: Not to be published in full, or part, in any form before 00.01am GMT Wednesday 16 February 2011 hectare in these examples). The major factor behind this wide range in economic performance is variation in the level of income from agriculture (as opposed to income from diversification, Single Payment or agrienvironment payments).
Environment, Food and Rural Affairs Committee: Evidence Ev 75 37. Grazing livestock farming is currently almost always economically unviable without public payments. Figure 6, below, shows the breakdown of income from business activities and subsidy for both lowland and upland grazing farms. Lowland grazing farms share the same diYcult economic circumstances, although typically make slightly less of a loss on their agricultural activities and have greater scope for diversification income. Figure 6 Breakdown of income sources for lowland and upland grazing farms in England for the latest three years. Length of columns indicates the contribution from each source). Farm Business Income shows the gross income from each of these sources, including the contribution of agriculture, which has a negative net margin or income £ per farm 30000 20000 10000 0 -10000 -20000 2006/07 2007/08 2008/09 2006/07 2007/08 2008/09 Lowland grazing livestock LFA grazing livestock EMBARGOED ADVANCE COPY: Not to be published in full, or part, in any form before 00.01am GMT Wednesday 16 February 2011 Single Payment Scheme Agri-env acvies (a) HFA payments Diversificaon Ag net margin Farm Business Income Source: Farm Business Survey 38. Without support from the Single Payment Scheme and the former Hill Farm Allowance), many upland farmers would, at current (or recent) input and output prices be making a loss on average on their farm business activities. 39. This reliance on public support is demonstrated by an analysis of Farm Business Survey data for 2008–09, which shows that upland farmers received around £163 million from the Single Payment Scheme, £54 million from agri-environment payments and £19 1 2 million from the Hill Farm Allowance scheme (now replaced by Uplands ELS funding of £25 million, depending upon uptake). When adjusted for business size the contribution to farm business income from the Single Payment is around 15% higher on upland farms than those in the lowland. The contribution from agri-environment schemes in addition to the Hill Farm Allowance is almost three times as great. 40. Diversification opportunities are often more limited in the uplands due to the sparse population and, for a number of areas, longer distances to large population centres. Farm Business Survey data highlights that LFA farms have the lowest proportion of diversified activity (41% of LFA grazing livestock farms undertaking some form of diversification in 2007–08, compared to 51% across all farms) and that the contribution of these diversified activities to farm business income was 21%. 15 The Uplands Farm Practice Survey found that more than half (56%) of upland farms had a diversified activity or other income contributing to household income. For almost half of upland farmers this was from an oV-farm diversification enterprise or income whilst a quarter of upland farms had an on-farm diversified enterprise such as a farm shop or Bed & Breakfast. The survey highlighted that over half of upland farmers with no current diversified activity felt there was either no scope or they had no plans to diversify, and a further significant group had never thought about diversifying (28% of those with no current on-farm enterprise and 43% of those with no current oV farm enterprise or income). There is, however, a greater tendency in the uplands towards supplementing farm income with oV farm employment—whether on the part of the farmer or spouse—reducing the time available for further on-farm diversification. 15 Farming in the English Uplands, Defra Agricultural Change and Environment Observatory
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5 Upland communities EMBARGOED ADVA
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Oral evidence Environment, Food and
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Tom Blenkinsop Richard Drax George
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walked they ain’t coming back, be
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great, but there is the wider issue
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Farming in the Uplands - ARCHIVE: Defra

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