The total outstanding bank debt of Scottish farms increased 5% over the past year, according to the latest statistics released by Scotland's Chief Statistician.

A survey of the main banks and other lending institutions showed outstanding loans to Scottish farms rose by £113 million in the year to May 31, 2017. Total outstanding loans to the agricultural sector amounted to £2.32 billion.  Accounting for inflation, this was an increase of three per cent since May 2016.

This was the eighth consecutive annual increase in Scottish farm bank debt. After remaining steady for a decade during the 2000s, debt levels have now risen to their highest since records began in 1972.

In addition to bank loans, farms have an estimated £1.1 billion of liabilities, related to hire purchase, family loans and other sources. About 50% of total liabilities are long term loans, a percentage that has been slowly increasing over time. In 2003 about 40% of debt was long term. Liabilities equate to about 8% of assets.

The data reflect the overall UK picture. Figures from the Bank of England showed that, by May 2017, the UK “agricultural, hunting and forestry” sector had an outstanding debt of £18.5 billion, having seen a 57% increase in debt levels since 2010. The only two other business sectors that had seen an increase since 2010 was utilities, which increased 63%, and wholesale and retail at 8%.

The statistics publication was produced by independent statistical staff free from any political interference, in accordance with professional standards set out in the Code of Practice for Official Statistics.