The NFU's economics team has highlighted the main drivers as the fall in crop area and lower yields, largely caused by extreme and variable weather conditions. The COVID-19 pandemic also led to supply chain disruptions and a fall in diversification activity which all impacted on prices, income and profitability.
There’s slightly better news for livestock producers who have seen their incomes rise due to firm prices and strong retail demand in the UK on the back of the out of home market being closed down due to COVID-19.
NFU Vice President Tom Bradshaw, pictured above, said:
“Farmers again faced a period of extreme weather across the country at the start of last year with heavy rain causing tough planting conditions, followed by one of the driest springs on record. This, together with the start of the global pandemic, meant very challenging conditions for many of our members. It is a relief to see the current strength in the red meat sector which for beef is long overdue and is a transformation since a year ago when carcass balance was such an issue.
“Volatility is something farmers are used to managing but it doesn’t make it any easier to deal with, especially when there continues to be so much uncertainty about future changes to agricultural policy and lack of clarity over new schemes.
“As we start to see cuts in our BPS payments it’s crucial that the Agricultural Transition Plan not only supports farming in the move to ELMs, but also provides the productivity improving measures, such as grants and investment in R&D, it has promised so we can build resilience, profitability and sustainability across all sectors.”