Confidence levels are at their lowest across the majority of sectors since records began in 2010.
The farmer confidence survey of almost 800 member businesses scanned horizons across all major UK farming sectors and saw short-term (one-year) confidence fall from -8 last year to -25 this time around, on a scale of -100 to +100, mid-term confidence (three year) only marginally higher at -22.
Extreme weather was a leading concern with 82% citing this as having had a very negative (30%) or fairly negative (52%) impact on their business in the past year. Further flooding and storms also occurred after the survey was undertaken.
“Any business owner knows that without confidence and a steady cash flow, that business will struggle to re-invest and remain viable.”
NFU President Tom Bradshaw
Production intentions have also plummeted with all sectors expecting to decrease production over the next year, with the arable sector predicted to be worst affected.
The phasing out of BPS payments (86%), rising input prices (80%) and government regulation and legislation (80%) topped the factors farmers said would negatively affect their farm business.
Only 52% said they would look to engage with ELMs to mitigate against the phasing out of BPS, with a further 37% saying they would instead diversify into a non-farming related activity.
Results paint ‘stark picture’
NFU President Tom Bradshaw said the survey results “paint a really stark picture”.
He said: “Confidence has collapsed after months of devastating flooding, unsustainably high production costs and low market returns, and against a backdrop of reduced farm support as we transition to a new Domestic Agriculture Policy and associated farm support.
“Any business owner knows that without confidence and a steady cash flow, that business will struggle to re-invest and remain viable.
“We have already lost more than 7,000 agricultural businesses since 2019 – no one wants to see that increase, least of all our customers who really value the high quality, sustainable food British farmers produce.
“With climate change wreaking havoc on food systems across the world and geo-political tensions high, Britain cannot afford to lose its ability to feed itself.”
NFU President Tom Bradshaw
“With climate change wreaking havoc on food systems across the world and geo-political tensions high, Britain cannot afford to lose its ability to feed itself.
“The good news is that there are solutions the current and future governments can adopt to help rebuild farm business confidence, from investment in our water management to developing core production standards for food imports.”
Reversing the confidence breakdown
A government strategy to avoid being undercut by imports produced at lower standards, an increase in output prices and reductions in input price inflation were the biggest potential drivers for future confidence, respondents reported.
The only investments farmers showed appetite for were in renewable energy, energy efficiency and diversifications, as farms sought to save costs and open new revenue streams. Machinery and land showed the sharpest decline in investment over the next three years at -39 and -15 respectively.
The NFU is calling for government to recognise the extraordinary nature of what has been the wettest 18 months since 1836, warning that many farms may be unable to survive.
View from the farm
NFU President Tom Bradshaw's farm
“On my farm near Colchester, I’ve lost 15% of my wheat crop this year because of the rain. But I count myself as one of the lucky ones. I’ve heard from farmers who have been forced almost to breaking point by the relentless flooding that has inundated their land and are ready to give up farming.
“Why does this matter? This collapse in confidence is likely to have serious long-term impacts on our ability to feed ourselves in an ever-changing world. Farmers and growers take great pride in producing high quality, nutritious, traceable food for the nation – food we know the British public trust and want to buy.
“But we cannot turn food production off and on like a tap. Once farm businesses close down, they are gone for good.
“In an age where weather events are now the norm and global instability is increasing, it has never been more important to ensure our food security. To do this, the farming sector needs to not only survive but thrive.”
NFU President Tom Bradshaw
In our general election manifesto, we have provided solutions that political parties can adopt which would work to reverse this breakdown in farmer confidence and help safeguard homegrown food production, including:
- Plan for and reward farmers fairly for their role in mitigating flood risk and commit to the proactive management of our watercourses.
- A smooth and seamless transition to new environmental schemes that are open to all farmers and growers, and ensure profitable long-term, food-producing businesses.
- Establish minimum standards to promote a fair and functioning supply chain.
- Develop and establish core production standards that apply to agri-food imports.
Read our manifesto asks:
‘We do not give up easily’
“A lot is hanging in the balance ahead of the General Election,” Tom added. “Political parties will rightly be focusing on how to reverse the cost of living crisis, and with food inflation still high and families struggling with food bills, supporting homegrown food production must be part of this.”
“While we are seeing record lows in farmer confidence, I never cease to be amazed by our amazing farmers and growers; their passion, drive and ingenuity for the work we do.
“Innate tenacity means we do not give up easily.”
Tom urged all political parties to recognise this resilience in the run up to the election, and the crucial role farming has to play in sustaining our nation.
