Growers fail to profit from record yields

More than 90 per cent of growers did not earn a profit from their 2015 winter wheat crop.
More than 90 per cent of growers did not earn a profit from their 2015 winter wheat crop.
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A record year for crop yields failed to produce a profit for the vast majority of growers in England, according to new research.

More than 90 per cent of growers did not raise a profit from their 2015 winter wheat crop, despite the highest national yield on record - averaging 9.8 tonnes per hectare.

In many counties yields exceeded 10t/ha and the highest averages recorded across the country were in East Yorkshire, at 10.7t/ha.

Yet most farmers will have struggled to capitalise on the good growing conditions, as the average cost of production was £143 per tonne which left farmers, on average £29 out of pocket on every tonne of wheat they produced.

The average wheat sales price in 2015-16 was £114/t.

The crop performance figures have been released as part of the Farm Business Survey carried out by Rural Business Research, a group of universities and colleges across England.

Ben Lang, from Cambridge University’s rural business unit, said: “Running such losses on the agricultural side of the business turned 2015 into a loss-making year for many arable producers. In the 2015-16 financial year, more than 3,000 arable farms in England failed to make a profit, even after subsidies, environmental stewardship and non-farming income.”

Just a small proportion of growers eked out a profit. Around three per cent of growers realised production costs of less than £100/t, which researchers said showed that low cost production in England is viable.

Mr Lang said: “These top performing businesses show that even in tough years, arable farming in England can be profitable. Benchmarking your cost of production figures against such businesses can highlight valuable cost saving measures for your farm.”

The average cereals farm business income fell by 20 per cent to £35,500 but those in the top 25 per cent group still achieved an income of more than £100,000 per farm, turning an average profit of £114/ha.