Statistics released yesterday by the Welsh government reveal that farming incomes in the country rose by 31 per cent in 2011. Farm incomes soared to £209.5 million last year on rising value for agricultural products from Wales and increased production.

The value of Wales’ agricultural output also saw an increase, rising to £1,393 million; again the rise was down to increased output and favourable market conditions. This led the Welsh government to forecast further rises for Welsh producers in 2012. Incomes are forecast to rise this year across all sectors.

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Wales’ deputy minister for Agriculture, Alun Davies welcomed the news, stating, "This news shows that we have a lot to be optimistic about for the forthcoming year. Strong market prices and increased production mean that farm incomes are set to rise for the first time in two years, which is very welcome. Wales is delivering excellent produce and it is very pleasing to see that farmers are being rewarded through increased prices and incomes."

However, the minister said that the increase was in a large part thanks to favourable exchange rates, which resulted in a rise in the value of Single Payments. He said subsidy payments represent between 80 and 90 per cent of farm income on average, and that the importance of the Common Agricultural Policy to Welsh farming must therefore not be underestimated.

Welsh farming unions “cautiously welcomed” the news, but warned that ever rising input costs may impinge on the benefits seen by farmers. Both the Farmers’ Union of Wales and NFU Cymru said that, although the rise in incomes shows farmers’ hard work can pay off, the inherent uncertainty of farming leaves little room for complacency.

NFU Cymru president Ed Bailey commented, “Reliance on currency fluctuations is a fickle basis for determining farm incomes and whether the positive picture of the last few years can be maintained through 2012 remains to be seen, especially given the apparent difficulties that some countries in the euro zone are currently experiencing.”

Mr Bailey concluded that, although “Today’s forecasts are in contrast to last November’s farm income figures, which showed an average decrease of 12 per cent in Welsh farm incomes, and the performance of the wider economy, this is undoubtedly positive news for the industry.”

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