Aberystwyth University’s latest Wales Farm Income Booklet
17 December 2018
Aberystwyth University’s latest Wales Farm Income Booklet, has just been published by IBERS. The handy pocket sized book provides really useful performance and benchmarking results from the Farm Business Survey (FBS) for 2017-18.
Tony O’Regan, Director of the Farm Business Survey said: “This booklet is aimed at providing farmers with a user friendly benchmarking tool and incorporates the latest financial and physical information for the main farm types in Wales. As Brexit creeps closer, it is hoped that it will prove useful and informative in aiding farmers to adjust to new economic circumstances.”
The booklet features sections on Whole Farm Data, Gross Margins, and Total Cost of Production where the unit cost of producing a kg/litre of produce have been set out with benchmarking in mind.
The results highlight significant differences between ‘average’ and ‘top third’ performing farms. For example, the top third performing cattle and sheep farms’ £ per effective hectare profit was over double that of the average and so the top third farmers made around an extra £29,000 on the upland £28,000 on the lowland cattle and sheep farms farm.
Likewise, on dairy farms top third producers made a net margin of 9p/l more than the bottom third which could potentially mean a six figure addition to profit. Meat producers showed similar variability with lamb producers ranging from making 39p/kg to losing 66p/kg, and beef producers ranging from plus 73p/kg to minus 64p/kg for every kilogramme (liveweight) that they sold.
The common trend every year is the range of profitability within the sample farms, for example the top third lowland cattle and sheep farmers retained around 40% of output as profit, compared with 20% as an average. Similarly top third lowland dairy units achieved 30% of output as profit versus an average of 20%,” said Mr. O’Regan.
Particular attention also needs to be given to the Basic Payment Scheme, other subsidies and diversified income so that the contribution of the ‘farming’ enterprises to the bottom line can be examined. For example, these three sources contributed around 44% of outputs and potentially 167% of profits, on average, for hill sheep farms.
Tony O’Regan was quick to recognise the support and assistance provide by farmers in Wales and added that many farmers kindly provide data for the Farm Business Survey and “Farmers across Wales will appreciate that the booklet is a valuable tool which will help them benchmark their performance”.
He added “Profitability is so important to all farm businesses and farmers need to be aware of their production costs. They need to know how their costs compare with those of other producers and how best to cope with and adapt their farming businesses to mitigate future business challenges”.
The Farm Incomes Booklet is kindly distributed on behalf of Aberystwyth University by Farming Connect to all farmers that registered with the new Farming Connect Programme. It is also available online at https://www.aber.ac.uk/en/ibers/research-and-enterprise/fbs/booklets/