Total income from Farming in England for 2021 (published 30 June 2022)

Question 1

Section 1: Key messages

Accepted Answer

TIFF in England in 2021 was £4,223 million, an increase of £636 million (17.7%) from 2020. Both crop and livestock output in 2021 increased meaning that, although costs increased, TIFF also increased to be the second highest in real terms since 2000.
In 2021 agriculture’s contribution to England’s economy (Gross Value Added(GVA^{[footnote 2]}) at basic prices^{[footnote 3]}) was £8,410 million, an increase of £817 million (10.8%) from 2020.
Total crop output in 2021 was £9,363 million, an increase of £1,693 million (22.1%) from 2020.
Total livestock output in 2021 was £10,535 million, an increase of £626 million (6.3%) from 2020.
Intermediate consumption in 2021 was £13,686 million, an increase of £1,614 million (13.4%) from 2020.

Table 1: The 5 largest changes from 2020 to 2021

Account item	change (£ million)
Wheat	1,065
Animal feed	857
Fertilisers	387
Other crop products	329
Plants and flowers	213

1.1 Recent comparison of TIFF in England

Figure 1: TIFF in England: 2017 to 2021 at current prices^{[footnote 4]}

Chart 1 is a bar chart showing the Total Income from Farming in England for the past 6 years. The average TIFF over these 6 years is £3.46 billion with the lowest TIFF of £2.36 billion coming in 2016 and the highest TIFF of £4.22 billion coming in 2021. The second highest TIFF in the last 6 years was £3.73 billion in 2017.

Question 2

Section 2: Outputs and subsidies

Accepted Answer

2.1 Overview

Figure 2.1: Outputs breakdown from TIFF in England: 2016 to 2021 at current prices

Chart 2 shows the breakdown of the outputs from the agricultural industry across the last 6 years by percentage between: crops, livestock, other agricultural activities and inseparable non-agricultural activities. In 2021 the breakdown by percentage was: 42.4% for crops, 47.7% for livestock, 5.1% for inseparable non-agricultural activities and 4.9% for other agricultural activities. For the past 6 years, livestock has consistently made the highest contribution to the accounts outputs, followed by crops, inseparable non-agricultural activities, then other agricultural activities.

2.2: Comparing outputs and subsidies from 2020 and 2021

This comparison of the TIFF account from the two most recent years is made between values that have not been adjusted for inflation. This approach is considered the most intuitive for comparisons year to year. See the data set for the full set of values expressed in current prices. This section contains commentary offering explanation for the values estimated for 2021 and how they have changed since 2020.

2.2.1 Crops

Figure 2.2: Main contributors to crop output (£ million)^(a)

Account item	2020	2021
Wheat	1,397	2,462
Plants and flowers	1,280	1,492
Fresh vegetables	1,405	1,411
Barley	782	848
Other crop products	461	791
Fruits	826	719
Potatoes	551	462
Oilseed rape	315	427
Sugar beet	167	216
Protein crops	153	213
Forage plants	167	154

^(a) AHDB stopped producing potato yield data and prices in the last half of 2021. We have therefore looked at previous trends for the missing data and also sought views from stakeholders to estimate the value of the sector.

The largest crop contribution to TIFF in England in 2021 was Wheat, contributing £2462 million, an increase of 76.2% on 2020. The value of wheat in 2020 was exceptionally low due to poor planting conditions at the end of 2019, which resulted in the lowest wheat production in the UK this century. 2019 was a more standard year and, when comparing 2021 to 2019, the value of wheat is only 8.5% higher. The main cause for the increase in wheat value was the increase in price which, on a UK level, increased by 20.0%. While the volume of wheat production was up from 2020, it fell in comparison to production in the more typical 2019 year.
The biggest value change in crops from 2020 was also in Wheat, increasing by £1065 million. The second biggest change in a crops value was in Other crop products which increased by £329 million. This increase in value is due entirely to increases in the value of straw and inter-farm transfers of straw, which increased in value, on a UK level, by 78.1% and 77.8% respectively. 2021 saw reasonable crop yields with higher volumes of straw produced than in 2020. Additionally, the average price of straw in the UK in 2021 increased by 26.6% compared with 2020.
The largest two percentage changes were also in Wheat and Other crop products, increasing by 76.2% and 71.4% from 2020 respectively. The third largest percentage change was in Protein crops which increased by 39.2%. ‘Protein crops’ is made up of peas and beans, both of which saw price increases from 2020 of 12.9% and 12.7% respectively. The price of peas was paired with an 18% increase in area grown in the UK, although a lot of the crops was used for animal feed hence why the price of the remaining product still saw an increase. Beans saw a fall in volume but there was also a poor harvest in other countries leading to a high demand for UK beans causing the price to increase.

2.2.2 Livestock

Figure 2.3: Main contributors to livestock output (£ million)^(a)(b)

Account item	2020	2021
Milk	2,902	3,022
Poultry	2,387	2,429
Beef	1,429	1,616
Pigmeat	1,117	1,092
Livestock gfcf	888	983
Mutton and lamb	727	861
Eggs	441	505

^(a) gfcf stands for gross fixed capital formation

^(b)Cattle, sheep and pigs for meat have been renamed beef, mutton and lamb, and pigmeat respectively. The data used to calculate these values has not changed.

The largest livestock contribution to TIFF in England in 2021 was Milk, contributing £3022 million. The value of milk was £120 million higher than in 2020; this increase was due to an increase in the price of milk by 2.5p per litre (in the UK) from 2020. In previous years, milk prices have followed a seasonal pattern of rises and falls throughout the year. However, in 2021 milk prices generally increased throughout the year, with December 2021 seeing the first price increase from November to December since 2016.
The biggest value change in livestock from 2020 was in Beef, increasing by £187 million. This increase in the value of beef was due to an average increase in the UK price of 6.9% in 2021, this follows a longer term trend of red meat prices increasing. Volume of production was also slightly up despite slaughter numbers being low due to an increase in the average carcass weight.
The largest percentage change was in Mutton and lamb increasing by 18.4% from 2020. This increase in value was driven by an increase in price as slaughter numbers were down in the UK by 10%. Imports and exports were both down by more than 10%.

2.2.3 Other outputs and subsidies

Figure 2.4: Breakdown of other outputs and subsidies (£ million)^(a)(b)

Account item	2020	2021
Subsidies less taxes not linked to production	2,117	2,066
Inseparable non agricultural activities	1,119	1,119
Other agricultural activities	967	1,078

^(a)Since 2012, subsidies linked to production have only been paid in Scotland.

^(b)Subsidies not linked to production are all subsidies not directly linked to production, including the basic payment scheme and agri-environment schemes.

Question 3

Section 3: Inputs and costs

Accepted Answer

3.1 Overview

Figure 3.1: Inputs breakdown from TIFF in England: 2016 to 2021 at current prices

Chart 3 shows the percentage breakdown of the costs from the agricultural industry across the last 5 years between: intermediate consumption, total fixed capital consumption, compensation of employees, and rent and other costs. In 2021 the breakdown by percentage was: 68.6% for intermediate consumption, 17.1% for total fixed capital consumption, 10.6% for compensation of employees and 3.6% for rent and other costs. For the past 6 years, the largest contribution to the accounts inputs has been intermediate consumption, followed by total fixed capital consumption, compensation of employees, then rent and other costs.

3.2 Comparing inputs and costs from 2020 and 2021

3.2.1 Intermediate consumption

Figure 3.2: Main contributors to intermediate consumption (£ million)

Account item	2020	2021
Animal feed	3,874	4,731
Other goods and services	2,269	2,424
Total maintenance	1,459	1,495
Fertilisers	690	1,077
Agricultural services	962	1,065
Energy	899	1,014
Plant protection products	772	828
Seeds	759	682
Veterinary expenses	266	264

The largest expense contribution to TIFF in England in 2021 was Animal feed, contributing £4731 million. In 2021 the volume of compound animal feed used increased across most sectors, resulting in a 7.4% increase in volume in the UK. This increase in volume was coupled with a 14.1% increase in price(again in the UK), due to higher prices of raw materials.
The biggest value change in expenses from 2020 was also in Animal feed, increasing by £857 million. The second biggest change in an expenses value was in Fertilisers which increased by £387 million. This increase in the cost of fertilisers was driven mainly by price, which increased by 46.3% across the UK, whereas the volume only increased by 4.5%. The volume increase was due to the return to standard sowing patterns. Winter crops, which tend to require more fertiliser, survived from the end of 2020 into 2021, whereas the winter crops from 2019 into 2020 had failed. The price increase was due in part to a higher demand but was mainly driven by an increase in manufacturing costs linked to the surge in the price of natural gas in 2021.
The largest two percentage changes were also in Fertilisers and Animal feed, increasing by 56.1% and 22.1% from 2020 respectively. The third largest percentage change was in Energy which increased by 12.8%. ‘Energy’ as an intermediate consumption takes into account ‘electricity and fuels for heating’ as well as ‘motor and machinery fuels’ both of which increased in price. Heating costs saw a small increase in volume but the price increased by 6.1% following the global energy price increases. Motor and machinery fuels decreased in volume used by 3.2% but saw a price increase of 22%. This increase was mainly driven by a return to more normal oil prices, following lows in 2020 caused by the Covid-19 pandemic.

3.2.2 Other inputs and costs

Figure 3.3: Breakdown of other inputs and costs involved in farming (£ million)

Account item	2020	2021
Equipment fcc^(a)	1,559	1,630
Livestock fcc	1,028	980
Buildings fcc	777	809
Rent	453	454
Interest	275	262

^(a) fcc stands for fixed capital consumption which is also referred to as consumption of fixed capital elsewhere

Question 4

Section 4: Long term trends of TIFF in England

Accepted Answer

Figure 4: TIFF in England in real terms^{[footnote 5]} from 2000 to 2021

In 2002 TIFF doubled to almost £2 billion then remained similar through to 2007.
In 2008 TIFF almost doubled to nearly £4 billion and was similar in 2009.
In 2010 TIFF then fell to just over £3 billion before jumping to over £4 billion for the first time in 2011.
From 2011 to 2014 TIFF remained fairly constant with the highest TIFF since 2000 coming in 2013.
TIFF fell sharply in 2015 driven by lower commodity prices and a stronger pound. In 2016 the exchange rate improved but a poor harvest drove TIFF to below £3 billion for the first time since 2008.
In 2017, as a result of a favourable combination of a weaker pound, strong commodity prices and high levels of production TIFF jumped up to over £4 billion.
In 2018 extreme weather conditions led to a poor harvest although this also drove up prices resulting in only a minor fall in TIFF. In 2019, favourable weather produced modest increases to both crop output and TIFF.
Although 2020 was dominated by Covid-19, bad weather at the end of 2019 also had an impact. Winter crops failed and caused farmers to change to spring sown crops, which require more attendance with machinery but less fertiliser. This meant that one of the impacts of Covid-19, driving down energy prices, had a positive impact on TIFF as the price of red diesel was driven down due to low demand worldwide. All these and other complications meant that TIFF only ended up falling slightly in 2020 from 2019.
In 2021, a large increase in input costs was offset by a return to more usual crops yields and an increase in the value of livestock outputs, resulting in, the second largest TIFF in England in real terms this century.

Question 5

Section 5 - About these statistics

Accepted Answer

5.1 Contact details

Tim Buttanshaw farmaccounts@defra.gov.uk
Telephone: 020 8026 3601
Media enquiries: 0345 051 8486 Public enquiries: 0845 601 3034

Horizon House
Deanery Road
Bristol
BS1 5AH

5.2 National statistics status

National Statistics are produced to high professional standards. They undergo regular quality assurance reviews to ensure that they meet customer needs. They are produced free from any political interference. The statistics last underwent a full assessment in 2014 by the UK Statistics Authority’s Assessment team. A copy of the full report can be found on the internet, Assessment Report 271 Statistics on Agriculture. The continued designation of these statistics as National Statistics was confirmed in December 2017 following a compliance check by the UK Statistics Authority (now the Office for Statistics Regulation) against the Code of Practice for Statistics. The compliance check letter can be found on the UK Statistics Authority website. Since the latest review by the Office for Statistics Regulation, we have continued to comply with the Code of Practice for Statistics and have enhanced data quality by reviewing methodologies and data sources

5.3 Methodology

TIFF refers to income generated by production within the agricultural industry, including subsidies. TIFF represents business profits and remuneration for work done by owners and other unpaid workers. It excludes changes in the values of assets and stocks due to price changes, but includes non-agricultural activities such as further processing or tourist activities where these cannot be separated from the agricultural business. TIFF is the preferred measure of aggregate income for the agricultural industry, conforming to internationally agreed national accounting principles required by the UK National Accounts.

Values for England are derived by subtracting similar accounts for Wales, Scotland and Northern Ireland from the United Kingdom agricultural production and income account. Latest account information for the UK can be found at United Kingdom: Total Income from Farming statistics. Similar information for devolved administrations are available at Scotland: Total Income from Farming statistics, Wales: Aggregate agricultural output and income statistics and Northern Ireland: Aggregate agricultural account statistics.

The UK level estimates used as a starting point for the estimates in this release were published by Defra on 12 May 2022. The estimates for the Devolved Administrations, which were deducted from the UK estimates, were based on the latest figures published by Wales and Northern Ireland, while output figures for Scotland have been estimated due to a temporary hiatus in their reporting to enable development.

The Scotland outputs data was estimated by applying the year-on-year percentage change from the UK figures to the Scotland 2020 figures. Other more data intensive methods were explored but the results differed minimally given that values for England make up the majority of TIFF, and so more complicated estimation methodologies were not deemed to add any value.

5.4 Revisions

The value of subsidies not linked to production has been updated for Scotland, Wales and Northern Ireland from 2010, which has increased the value in the England account by a small amount thus increasing TIFF, for example the value in 2020 of other subsidies not linked to production has increased by £22.9 million
The value of eggs has been revised from 2018 onwards, owing to an error where unpacked eggs were not included in the total value.
The methodology for calculating the value of potatoes has changed for 2021 in comparison to previous years. AHDB stopped producing potato yield data and prices in the last half of 2021. We have therefore looked at previous trends for the missing data and also sought views from stakeholders to estimate the value of the sector.
To bring the terms used in the TIFF publication in line with wider Defra publications, cattle, sheep, and pigs primarily for meat have been renamed beef, mutton and lamb, and pigmeat respectively. This is to increase consistency and aid usability of our published statistics. The methodology by which these items are calculated remains unchanged.

Revisions are intended to increase the precision of the estimates and are routinely the result of more data becoming available over time. Sometimes additional revisions are necessary to refine the methodology or correct historical errors.

TIFF is the relatively small difference between two large numbers and is therefore sensitive to small percentage changes in the values of Outputs and Intermediate Consumption. A combination of a revision downwards in Output and revision upwards in Intermediate Consumption leads to more sizeable revisions in percentage terms to GVA and TIFF.

Further information can be found on the webpage for Defra’s policy statement on revisions and correction.

5.5 Summary quality report

A summary quality report for this statistical release can be found on the GOV.UK website for Aggregate agricultural accounts. This is an overview note which is not release specific and was last updated in March 2019. It pulls together key qualitative information on the various dimensions of quality as well as providing a summary of methods used to compile the output. It relates to estimates of Total Income from Farming and aims to provide users with information on usability and fitness for purpose of these estimates.

5.6 Quality assurance

DEFRA has in place quality assurance processes to check the accuracy and reliability of the aggregate agricultural accounts that include:

Ongoing review of methods employed in the calculation of the accounts.
Assessment of the quality of the estimates of items of the accounts with experts within DEFRA.
Discussion of items of the accounts with external experts.

5.7 Development areas

DEFRA statisticians carry out a continuous review of methods employed in making estimates of the production and income accounts. This may lead to revisions to data series owing to improvements in methods, in addition to the use of more up-to-date information.

5.8 Main users and uses of these statistics

The aggregate agricultural accounts are used both within government and by the wider agricultural industry in conjunction with other economic information to:

Monitor the productivity and competitiveness of the farming industry.
Inform policy decisions and to help monitor and evaluate current policies relating to agriculture in the UK by Government.
Inform stakeholders of the performance of the agricultural industry.
Inform research into the economic performance of the agricultural industry.

5.9 User engagement

As stated at the start of this release, part of our ongoing commitment to compliance with the Code of Practice for Official Statistics, is to strengthen our engagement with users of these statistics and better understand the use made of them as well as the types of decisions that they inform. Thus, we invite users to make themselves known, to advise us of the use they do, or might, make use of these statistics, and what their wishes are in terms of engagement. Feedback on this notice and inquiries about these statistics is also welcomed. Please complete this feedback form to tell us how you use this statistical notice.

If you have any other feedback you wish to provide, please get in contact using the details provided in the ‘What you need to know about his release’ section.

5.10 Future publications

Unless otherwise specified, these provisional estimates for 2021 will be subject to minor revisions in future publications of TIFF in England. The final estimates for TIFF in England for 2021 will be published in the spring of 2023 . The availability of additional data and revised data will be incorporated to improve the accuracy of the estimates.

To find out the latest information on when UK government statistics will be released, go to the gov.uk Research and statistics webpage and select ‘Statistics (up-coming)’.

5.11 Other publications relevant to this release

A number of publications released by DEFRA, are relevant to this release. Below is a list of the key publications and links to them on GOV.UK

Previously we have referred to this release as “first estimate”. We have changed this to be “provisional estimate” to bring it in line with the wider farming statistics releases. This represents a change in terminology only, ↩
GVA (Gross value added) is the value of all goods and services produced minus the cost of all the inputs; raw materials and labour etc. ↩
Basic prices refers to the fact that there are no subsidies included in this value. ↩
Current terms means that the values from previous years have not been adjusted for inflation. ↩
Real terms means that the values from previous years have been adjusted for inflation using the current year as a baseline. ↩

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