Predicting the future for farmers is a tricky business. Witness last December’s HSBC Forward Planning report which confidently looked ahead to an exciting time for livestock farmers and growing strength in the dairy sector. We weren’t that far into 2014 before the wheels came off the beef price and, shortly afterwards, the farmgate milk price starting dropping like a stone as processor after processor pulled back. No wonder the experts are being a more cautious this time around as they look ahead to 2015.
The current low oil price is a double-edged sword. Cheaper oil cuts the costs of running the farm, impacting not just on fuel but on many agri-chemicals too. But trading nations that were buying UK agricultural product might find themselves unable to do so as their economies are hit by falling oil prices.
NFU economist Anand Dossa appeared on Radio 4’s Farming Today programme recently, commenting on whether the predicted drop in oil prices would have a positive effect on farmers.
He said that farmers would welcome that input prices might fall due to the cost of oil bit it won’t be a sufficient enough fall to offset the decline in farmgate prices that have fallen across the board.
You can listen to the programme again here to catch the full interview.