New figures have revealed that the costs faced by arable farmers have fallen, new figures show.
The latest data from Anglia Farmers AgInflation Index – a well-regarded tool for estimating farm costs – has shown that during the last 12 months there has been a 1.14 per cent decrease in input costs across the sector.
The figures reveal that whilst the Retail Price Index has decreased by -2.6 per cent during the last year, farmers growing crops have seen their production costs fall in line or below this amount, while the livestock industry has experience a general increase in costs.
The decline could help the industry, say accountancy firm The Fish Partnership.
This improvement in arable farming is understandable with the decline in costs for fertilisers, which have fallen by around 18 per cent and agrochemical prices, which have dropped by around 3.2 per cent.
In comparison, the cost of animal feed and medicine for livestock has increase by 2 per cent during the same period between September 2015 and September 2016.
This situation has been made worse for livestock farmers as they continue to experience unstable and lower prices for their produce, with many farmers reporting an overall decline in their income.
Paul Laird, a director at the Fish Partnership and specialist in the finances of the farming community, said: “Prices and costs within the farming sector are constantly changing and so when opportunities appear, farmers need to make the most of them.
“Those producing cereals and other arable products should be using this period of lower costs to focus on investing in the future, so that they are ready for future changes in costs or pricing.
“Unfortunately, those in the livestock sector are being hit by a double whammy of low farmgate prices and higher costs.
“Many may find that they need to reassess their position and consider diversifying to make their business more robust.”
