New government statistics released reveal that farming incomes in the UK have dropped to their lowest level since 2007.
Extreme weather and the Covid-19 pandemic have been blamed for a sharp drop in this year's total agricultural income, Defra said in its new report.
Total Income from Farming (TIFF) - a measure of the performance of the UK agricultural industry - was estimated to be £4.1bn in 2020, a fall of £768m (-15.7%) from 2019.
The main drivers for the fall were a £999 million (-10.0%) fall in the value of crop output, largely caused by unfavourable weather conditions, the forecast explained.
There was also a £310 million (-20%) fall in the value of output from inseparable non-agricultural activities (diversified activities) due to lockdowns.
These more than offset a £490 million (+3.4%) rise in the value of total livestock output. Overall input costs were almost unchanged.
Defra said in the report that last year's farming income figures were the lowest value - in real terms - since 2007.
"Total Income from farming (TIFF) in 2020 was £4,119 million, a fall of £1,050 million (-20%) in real terms (adjusted for inflation) compared with 2019.
"The main contributors to this decrease are the fall in the value of output from wheat (-£885 million, -36%), oilseed rape (-£227 million, -39%) and inseparable non-agricultural activities (-£310 million, -20%)."
This news comes as the government launched a consultation on a new retirement scheme for farmers and the UK offered Australia a zero-tariff, zero-quotas trade deal for beef and lamb, leading many farmers to worry they’ll be undercut.
In the coming years, a new farm payments scheme will launch, rewarding farmers for improving the natural environment, by planting trees, increasing biodiversity and restoring peat bogs.