Farming set for income rise of 18pc

Farm incomes rose 8.7pc last year to an average £13,000 a year while incomes in the hills were just £5,900, Defra's latest figures confirmed yesterday.

The total income from farming - the measure of the agricultural industry's profit - rose by 5.7pc in real terms to £2.54bn but it masks rising fortunes in the arable east while the livestock sector faces acute price pressure.

The outlook is generally much brighter, with the dairy sector and cereal growers set to enjoy a marked improve-ment in fortunes this year.

Defra predicts that average farm business income across England will rise by about 18pc compared with the previous year, but sharply rising costs of energy, fuel, seed and fertilisers will dent returns.

For the survivors in the dairy sector, which has seen a major reduction of almost half in the past decade, the prospects are rosier.

Average dairy farm income will rise by 50pc - driven by higher milk prices set to be 24pc higher than last year.

However, given the past five years of losses, the dairy sector needs to rebuild profitability in order to contemplate badly-needed and long overdue investment in buildings and plant.

Peter Kendall, president of the National Farmers' Union, said the figures demonstrated how important it was for the livestock sectors to recover, if the industry as a whole was to make its full contribution to Britain's food supplies