Farmers’ earnings have effectively stalled since the mid-1970s, a new study by the Food, Farming and Countryside Commission has revealed.
While productivity has improved and fewer people now work on the land, average annual farm income — at about £32,272 over the last five years — has scarcely budged in real terms for five decades.
The findings come amid farmer protests over a new inheritance tax on agricultural assets, prompting fears that families could be forced to sell land simply to pay the levy. This is compounded by the end of EU subsidies and the wettest 18 months on record, leaving many producers facing some of the toughest trading conditions in memory.
Sharp falls in the price of farm produce are highlighted as a key driver of low incomes. Consolidation among big suppliers of animal feed, fertiliser and machinery has limited farmers’ power to negotiate, while supermarkets buy in bulk and focus on imports, placing further pressure on UK producers’ margins. According to the report, a handful of companies dominate the supply chain for key inputs, such as abattoir services and dairy processing, giving farming communities little room to shop around.
In addition, cheaper, ultra-processed foods have gained popularity among consumers, eroding demand for domestically sourced, higher-welfare produce. As a result, real incomes in other sectors have risen over the same period, but agriculture appears to have been left behind.
The Commission’s recommendations include adopting core standards in trade deals to ensure imports meet UK standards on environment, health and animal welfare. It also calls for a new food market regulator with a mandate to champion public value, and for government spending to concentrate on nutritious crops such as fruit, vegetables and pulses. Environment Secretary Steve Reed has pledged to publish a 25-year farming plan that addresses supply chain fairness, so farmers are “paid enough for what they do.”
While consumer food prices have tumbled in recent years, the report argues the true cost of low food prices is passed on through declining rural incomes, diminishing wildlife and ecosystems, and undermined domestic food security. Four firms supply about 70% of fresh beef to UK supermarkets, while just two dairy processors handle around 40% of national milk output. Over half the cattle and sheep feed in the UK is sold by four companies, and three large fertiliser producers dominate supply, leaving many farmers financially squeezed and lacking real bargaining power.
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UK farmers’ incomes stuck at 1970s levels, major report warns