Farm income rises £5,000, study finds (From Gazette & Herald)

Farm income rises £5,000, study finds

AGRICULTURE in Yorkshire saw its overall finances boosted slightly during 2001 and 2002, although some sectors of the farming industry had a more difficult year.

A study by Askham Bryan College, which does not include data from farms hit by foot and mouth disease (FMD) so as not to distort comparable figures, shows that in the financial year ending April 2002, average net farm income rose by just over £5,000 to £17,625.

While some farm types, notably dairy farms, showed a significant improvement, others saw a deterioration in their financial position.

Mervyn Lewis, head of the rural business research unit at the college, which studied 270 farms in the Yorkshire area, said: "There has been a small but welcome increase in farm profitability for the 2001-02 financial year.

"This increase is mainly due to better incomes on dairy farms which saw their best results for at least four years. This was brought about by higher milk prices.

"However, the agricultural sector as a whole is still in recession with nearly all the main types of farming showing a negative return on capital."

The report shows that lowland dairy farms had their best year since 1995-6, almost entirely due to the recovery in the milk price which rose by 19pc to average 19.8p per litre.

There was also a higher number of dairy cows kept on farms due to the restrictions imposed as a consequence of FMD.

Other sectors had a more difficult year. Arable farms reported a drop in income due to a 30pc fall in wheat output because of difficult conditions in autumn 2000.

Lowland livestock farms saw a further fall in profitability.

The study has a separate section dealing with the impact FMD had on the region. Some parts, such as the East Riding, escaped the disease but were affected by the movement restrictions imposed.

The farms which endured a partial or complete cull of animals showed an improvement in income levels, mainly due to compensation payments.

Mr Lewis said the financial year 2002-03 will see little economic improvement for many farms due to poor cereal prices and a fall in milk prices.

He said the potato sector was also having a difficult year with non-contract crops being impossible to sell. However, the livestock sector should see improved levels of profitability.

Updated: 10:50 Wednesday, January 15, 2003