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CUSTOMER ACCOUNTS - THE REGIONS FACTS FROM FIGURES


By Roger W Dean, Dean Agricultural Associates Nevertheless, having covered other livestock species, it is


Government ministers have recently made much of their belief that, with rising agricultural prices, the need for farm subsidies will diminish. Nevertheless, in last month’s edition, it was established that direct payments to English livestock farmers currently constitute a critical part of their Farm Business Income and this will need to be recognised in any future debate on the future of the CAP. In this article, the situation in the pig and poultry sectors and in the devolved regions of the UK is discussed, as is the position in the English regions. It rapidly becomes evident that the Single Farm Payment is an integral part of the economics of much livestock production, particularly of cattle and sheep grazing but also of dairy farming and that any discussion of the future of direct payments to farmers will assume special importance in the context of the UK regions. Finally, Roger Dean concludes his two-part survey of Farm Business Incomes with a first look at the situation in the twelve months ending February 2011 and finds that many of the feed industry’s livestock producing customers will be worse off than they were in the year up to February 2010.


Although cattle and sheep have generally been in receipt of some sort of assistance via the Common Agricultural Policy, there was traditionally a marked reluctance on Brussels’ part to extend the same largesse to pig and poultry producers because they were seen as, essentially, industrial rather than agricultural enterprises. In passing, this view seems to have been rather unfair in that a substantial part of the inputs for pig and poultry production were supported by the Common Agricultural Policy with the result that the price of feeds incorporating that essential ingredient for monogastric nutrition, wheat, were higher than they otherwise might have been.


Low


appropriate to look, however briefly, at pig and poultry producers and for pigs and this is done in Tables 1 and 2. Table 1 reflects the fact that there are a statistically insignificant number of part-time, small and medium-sized pig producers and that the sector can only be delineated in terms of the average and the ‘large’ producer.


Table 1: Specialist Pig Producers’ Farm Business Income by Cost Centre and Size of Farm 2009-10


Source of Farm Business Income


Agriculture


Agri-Environmental Payments


Diversification out of Agriculture


Single Farm Payment


Total Farm Business Income


Large


89.4 1.2


1.3 8.1 100 All Sizes


£ per farm % £ per farm % 127,041 1,697


62,375 1,091


1,835 11,551 142,124 1,313 6,786 71,565


87.2 1.5


1.8 9.5 100


Source: Table 6.12 of Farm Accounts in England 2009-10: Specialist Pig Farms: Output, Input Costs and Income by Size Group


In fact, the share of Farm Business Incomes constituted by the


Single Farm Payment, although small, is surprisingly significant in the case both of the ‘large’ specialist pig farm and the average-sized unit. As far as performance is concerned, however, the number of specialist pig farms in the top quartile – the top performers, in other words – was statistically insignificant and, as a result, it is only possible to assess the average performance together with the lowest and middle quartile [1]


. The worst performing specialist pig farms derived over 59 per


[1] Farms are allocated to performance bands according to total farm output divided by total farm costs. The farms are then ranked and allocated to groups representing 25, 50 and 25 percentiles; equivalent to low, medium and high performance bands.


Table 2: Specialist Pig Producers’ Farm Business Income by Cost Centre and Performance Band 2009-10 Source of Farm Business Income


Medium Agriculture


Agri-Environmental Payments Diversification out of Agriculture Single Farm Payment


Total Farm Business Income


£ per farm 744


1,236 790


4,055 6,826


%


10.9 18.1 11.6 59.4 100


£ per farm 87,765 1,389 1,876 9,185


100,215 %


87.6 1.4 1.9 9.2


100


£ per farm 62,375 1,091 1,313 6,786


71,565


All Performance Bands %


87.2 1.5 1.8 9.5


100 Source: Table 7.12 of Farm Accounts in England 2009-10: Specialist Pig Farms: Output, Input Costs and Income by Performance Band PAGE 14 MARCH 2011 FEED COMPOUNDER


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