Farmers face a quarter cut in annual income.
FARMERS in Wales face a fall in their incomes of nearly a quarter this year because of changes to European Union (EU) funding, figures suggest.
A 24% drop in farm business income for all Welsh farms - down from PS29,300 in 2013-14 to PS22,200 in 2014-15 - is predicted in Forecasts of Farm Incomes in Wales 2014-15.
Average farm business income on hill livestock farms is expected to decrease by 22% from PS19,200 in 2013-14 to PS15,000 in 2014-15, while the equivalent figures for lowland livestock and dairy farms is predicted to be down 19% and 23% respectively. The report by the Welsh Government attributes the falls in incomes to reductions in what farmers receive for their produce and the value of the Single Farm Payment.
Farmers' Union Wales (FUW) president Emyr Jones said the figures highlight the need for a greater emphasis on improving farm incomes under the 2014-2020 Rural Development Plan.
He said: "The combined impact of reduced farmgate prices, the Welsh Government's 15% Pillar Transfer, a reduced Common Agricultural Policy (CAP) budget and a Single Payment exchange rate of PS0.7773 to one euro has had a catastrophic impact on farm incomes. The fact that sterling is continuing to strengthen against the euro means there is ongoing pressure on prices, with the situation in relation to Greece not helping.
Meurig Raymond, president of the National Farmers Union, warned that the drop in farm incomes would inevitably lead to a fall in food production and to British consumers "losing out".
He said: "I'm not surprised by these latest figures that are a cause of concern for the industry. The Welsh Assembly must get behind Welsh farmers who need to be in a position to be more productive and competitive in an increasingly volatile global market."
A Welsh Government spokesperson said: "Forecasts of farm income provide a broad indication of how average incomes for each farm type are expected to move year on year. The forecasts are indicative and by no means final figures, with considerable variation in annual figures in recent years demonstrated in Wales and other parts of the UK.
"It is important to consider performance and opportunities over the longer run, where the outlook for Welsh agriculture remains very positive."