Farm Incomes Down By 13%

Defra released the second estimate of the total income from farming (TIFF) statistics for 2012 recently and the figures suggest that farm incomes fell by 13% (£721m) between 2011 and 2012 to £4,810m (real terms after allowing for inflation). RPI inflation increased by 3.2% during 2012.

Two main factors were given for the fall in total income and they were the weather and the resulting increased cost values; and a fall in the value of direct payments to farmers due to adverse changes in the Pound/Euro exchange rate. Poor weather affected the volume and quality of the harvest and increased the value of inputs used.

The income of farmers per annual work unit (AWU) was estimated to have fallen by 14% in real terms to £24,570 in 2012.

Gross output at basic prices at November 2013 was £24,089m and total intermediate consumption was £15,464m. There was a small decrease in Gross Value Added (GVA) of £51m to £8,625m because the increase in the value of intermediate consumption (goods and services used in production) was greater that the increase in the value of output.

Longer term trends show that total income from farming has remained at a higher level than the late 1990s and early 2000s but below a peak in the mid-1990s. Entrepreneurial labour income has performed better than TIFF mainly due to a decrease in the number of farmers and other unpaid workers.

High Street Sales Up On December Last Year

The value and volume of retail sales increased in December 2011 over December 2010 according to ONS. Sales values increased by 6.2% over last year while volumes increased by 2.6% over the same period. Volumes were driven mainly by motor fuel and textiles, clothing and footwear stores. Last year was hit particularly badly by the weather.

An estimated £42.1bn was spent in retail during December compared to £29bn in November. An estimated £343.2bn was spent in total during 2011 compared with £326.2bn in 2010. Internet sales were an estimated 10.9% of all sales at £837.1m in December. Last year the figure was £652m (9.1%).

An Increase In Agricultural Price Indices In September

The index of prices received by producers for the total of all agricultural products for September 2011 was 165.7, up from 159.2 in August.

The index of prices paid by producers for the total of all means of agricultural production for September 2011 was 153.1, up from 153.0 in August. The slight increase in purchase prices being covered by the larger increase in production prices. There was an increase in the price of fuel. Confidence is returning to cereals markets after fears of bad harvest weather subsided and prices retruned to normal after increasing earlier in the year. Potato prices started well this year as bad weather reduced availability. News of adequate harvests reduced fears and prices came down again.

Milk prices have increased steadily over the last 18 months with good demand and supply ensuring a good market. Good market conditions also apply to the beef market. Sheep and lamb prices have been sustained but prime prices are beginning to tail off.

Retail Sales Up By 6.2%

There was a 6.2% increase in the value of retail sales in April 2011 compared with April 2010. The volume of retail sales also increased but by the smaller amount of 2.8%. The combination of the effects of warm weather and the Royal Wedding had an effect on sales.

GDP Down More Than Expected

GDP in terms of volume decreased by 0.6% in Q4 2010 which is a downward revision of the decrease of 0.5% published in January. Production industries increased by 0.7% but services decreased by 0.7% and construction decreased by 2.5%. The GDP deflator is 2.8% above the sdame quarter of 2009. Household expenditure was down 0.1% in real terms and gross fixed capital formation down by 2.5%. The very bad weather is partly to blame for the change in GDP.

The Worst January Sales Growth For 15 Years

Retail sales got off to a bad start in 2010 with a like-for-like fall of 0.7% in January 2010 compared with the 1.1% rise in January 2009. On a total basis, January sales in 2010 reported an increase of 1.2% compared with the 3.2% of January 2009.

The weather was a factor as snow seemed to affect shoppers. Food sales went up in the first week of January while non-food sales suffered, especially discretionary items. Food sales slowed down and non-food sales improved slightly as the weather got better.

Internet, mail order and telephone sales were 14.6% higher in January 2010 than January 2009 and 26.5% in December. The snow may also have been a factor in the improvement of online sales. There was growth in the number of new online customers. Non-store retailing is the fastest growing sector but it still only accounts for 4% of total sales.

Retailers Disappointed By Fall In Sales

The January CBI Distributive Trades Survey says that retailers were disappointed by the slight fall in sales in early January having expected a three month run of growth. The extreme weather conditions may be partly to blame for the sales figures for the usually busy New Year sales. The increase in the VAT rate may also have been an influence. Retailers expect sales in February to be about the same as last year.