Home | Press | Publications | What We Do | Who We Are | Search | Site Map | Contacts | Links
Publications
Publications > Agriculture

Farm Incomes Estimates for Scotland 2000 News Release

31 January 2001
Scottish Executive National Statistics News Release

This document is also available in pdf format (81k)

Forecast estimates for aggregate and individual farm level incomes for 2000 have been prepared by the Scottish Executive and are published today (Wednesday 31^st January).

SECTION A: Aggregate Income Estimates -Commentary & Notes
SECTION B: Farm Level Income Estimates -Commentary & Notes
TABLE 1 Output, Input and Income of Scottish Agriculture at Current Prices
Figure 1 Scottish Total Income From Farming and per whole time person equivalents, in real terms at 2000 prices ,1973-2000
Figure 2 Scottish Total Income From Farming and Direct Subsidies in real terms (2000 prices), 1991-2000
TABLE 2 Farm Accounts Survey -Average Net Farm Income
Figure 3 Average Net Farm Income

PROVISIONAL SCOTTISH AGRICULTURAL INCOME

1. The following are the main results from the latest Annual Review of Scottish Agriculture. For Section A, Table 1 gives aggregate results on income figures over the last 3 calendar years - 1998, 1999 and 2000. Long term trends in aggregate farm incomes in real terms since 1973 are shown in Figure 1 and the relationship between incomes and subsidies in Table 2 Section B compares net farm income results by farm type for the financial years 1998/9 and 1999/00 along with forecasts for 2000/01. These are given in Table 2 and Figure 3.

SECTION A: Aggregate Measures

2. The aggregate results for 2000 are provisional, and are based on the latest information available. The information on outputs is normally complete, but information on inputs tends to become available later. The 2000 estimates are therefore subject to revision in the next Annual Review using later information.
3. The Total Income From Farming (TIFF) which measures business profits plus income to workers with an entrepreneurial interest, is expected to show an decrease of around £33 million in 2000, a fall of 13% from last year. The underlying details of this are presented below.

Output

4. The value of gross output (including subsidies directly related to products) is forecast to have fallen by 2% since 1999. This fall was largely due to pressure on prices for agricultural outputs caused by a further rise in sterling against the euro of around 8% in 2000 compared with 1999. Prices have fallen particularly for milk and cereals and also, because of domestic market conditions, for potatoes.
5. Yields for most cereals show an increase from last year, but prices were lower. The marginal increase in cereal output was solely due to a 24% increase in the value of the wheat crop, reflecting a large increase in the planted area, this offset falls in barley and oats The value of potatoes fell by about 16% reflecting the poor prices for the 1999 crop sold in the first half of 2000 in sharp contrast to the situation in 1999 when output was boosted by the high prices for the 1998 crop sold in the first part of 1999.
6. In the livestock sector, figures show little change compared to last year. Finished cattle output was up a little and finished sheep and lambs down a little- the latter reflecting lower slaughterings and lower Sheep Annual Premium payments. Pig and Poultry output were up 4% and 2% respectively, reflecting better prices in the case of pigs and increased volumes in the case of poultry.
7. The output value of milk is forecast to have decreased by £21 million or 9% in 2000. The average price of milk fell by just under 2 pence per litre, caused in part by the strength of sterling.

Inputs

8. Gross input value is forecast to be almost unchanged. at £1043m in 2000, reflecting savings in animal feed, seeds, farm maintenance, pesticides, and machinery repairs but these were offset by significant increases in fuel, and fertilisers.
9. The interest bill is forecast to have risen by about £14 million (14%) from 1999 due largely to increases in bank borrowings but also to a modest increase in interest rates last year compared with 1999. In contrast labour and net rent fell by £5 million (2%) and £1 million (8%) respectively.

TABLE 1 OUTPUT, INPUT AND INCOME OF SCOTTISH AGRICULTURE AT CURRENT PRICES

(a) Also known as Intermediate Consumption
(b) Also known as Total Intermediate Consumption
(c) Fromerly known as Gross Product
(d) Formerly known as Net Product
(e) Also known as Compensation of Employees

SECTION B — Farm Level Estimates

10. Table 2 presents out-turn data from the Farm Accounts Survey comparing 1998/9 and 1999/00 along with forecasts for 2000/01.
11. Averaged across all farm types, net farm income fell by 24% between 1998/9 and 1999/00, to an average of £3,900 per farm. All farm types experienced falls except for cereal farms and mixed farms, which benefited from switching land from oilseed rape to barley.
12. Net farm incomes are forecast to fall by a further 4% in 2000/01, to an average of £3,800 per farm. Incomes are expected to increase for general cropping farms and for hill livestock farms, but decrease for cereal, dairy and mixed farms.
13. These forecasts reflect continued low prices for most agricultural commodities, particular milk and cereals. Improved prices for potatoes and sheep and beef animals have maintained incomes for general cropping and hill farms. Despite recent higher milk prices, the average price for the financial year is expected to be down by just under one pence per litre compared to the previous year. The better prices for sheep have outweighed the fall in the Sheep Annual Premium. Overall subsidies for beef cattle are expected to be up, partly due to the new slaughter premium, and store prices have generally been better than the previous year.
14. On the input side, farmers are forecast to continue cutting back on input use wherever possible, but increases in the price of fertiliser and fuel in particular have led to little change in overall costs.

Table 2: Farm Accounts Survey Results and Forecasts

NOTES TO NEWS EDITORS

SECTION A

• TIFF is business profits plus income to workers with an entrepreneurial interest (farmers, partners, directors and their spouses, and most other family members who work on the farm). It is the preferred income measure, conforming to internationally agreed accounting principles, required by both UK national accounts and Eurostat.
• The estimate of TIFF differs only slightly from the forecast figure published on 30^th November 2000 (Scottish Executive Press Release SE03088/2000) because of the incorporation of later information.

SECTION B

• Net Farm Income is the return to the principal farmer and spouse for their manual and managerial labour and on the tenant-type capital of the business. Thus the profitability of farms of different tenure can be compared. It is the preferred measure of income at the farm level.

• Net farm income data is based on a sample of 498 farms participating in the Farm Accounts Survey.

• The forecast figures for 2000/2001 are based on observed and forecast prices, marketings, subsidies, costs, livestock numbers and crop areas and yields. Forecasts are made on a static basis, assuming that the structure and enterprise mix of the farms is largely unchanged in the forecast year.

• The sample of lowland livestock farms is too small to be considered representative, and hence is not published separately. However, data from these farms is included in the figures for all farm types.

Figure 1

Figure 2

Figure 3

The information contained on this WWW site is Crown Copyright but may be reproduced without formal permission or charge for personal or in-house use. Privacy and Content Disclaimer.

For general enquiries about this web site email ceu@scotland.gov.uk or fill out our online questionnaire.