UK bucks trend as EU farm incomes plummet

The European Commission’s statistics department has released provisional figures which put EU agricultural income down 14.2 per cent in 2009.

The slump across Europe was attributed to a sharp fall in farm-gate prices against relatively high production costs.

The downturn in fortune has manifested itself in riots across the continent this year, including several dairy riots in Brussels and on Thursday (December 17) young French farmers dumped 10 tonnes of hay in front of the Elysée palace in Paris to show their frustration.  

French income dropped by 19.8 per cent in 2009, according to the Commission stats.

The largest fall in income came from Hungary (down 35.6 per cent) and Italy (down 25.3 per cent), while Irish farm income dropped by 22.3 per cent and German income dropped by 21 per cent.  

The UK bucked the trend however, with a rise of 14.3 per cent thanks largely to a 5 per cent fall in input costs and a favourable exchange rate that helped boost single payments by 17 per cent.

Malta and Finland also showed an increase in farm income.

Overall, agricultural income is estimated to have fallen in 22 Member States and to have risen in just five.

Mariann Fischer Boel, EU agriculture commissioner, said the economic crisis highlighted the need for a ‘strong, modern and effective’ CAP.

“Direct payments provide a basic level of income for farmers, cushioning them from price fluctuations. They still have a crucial role to play, representing roughly a third of farm income in the EU.

“Rural Development measures can also help, particularly when they are linked to restructuring or promote services like environmental protection which are not remunerated through the market,” she said, adding market intervention would also prove a vital tool to protect farmers.

UK farmers did receive a warning, however, after interim Defra forecasts estimated farm incomes could drop by 8 per cent in 2010.

Input costs are forecast to fall marginally in 2010 but Defra said farm output looks set to decline by 2.2 per cent and single payments are unlikely to receive the same exchange rate boost as they did in 2009.

However, the Department warned the estimates had ‘broad margins of uncertainty’ where specific events, such as disease outbreak or extreme weather, could shift incomes from the underlying trend in individual years.

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