Overall costs on a mixed arable and livestock farm since September 2007 are up by 35.53% according to latest research from agricultural purchasing group Anglia Farmers. 

Now accepted as the definitive guide, the Anglia Farmers Agricultural Inflation Index is based on actual cost change information from the group’s purchasing office on 95 products.  The method is similar to that used for the retail price index (RPI) where products are grouped and then weighted.

In addition to the overall agricultural inflation index, there are five enterprise sectors for combinable crops, potatoes, sugar beet, dairy and beef & lamb.

Giving a perspective, Jim Alston - who is a farmer director of Anglia Farmers and co-ordinates the AF Ag Inflation Index, has equated that if a 300 hectare farm mimicked its purchasing from last year at a cost of say £360,000, it would need to find another £120,000 this coming year from increased sales.

Clarke Willis, chief executive of Anglia Farmers, said: “Our members – and farmers nationwide – rely on this information.  Their costs are increasing at an alarming rate and this gives them the only source of accurate data to work with. 

“While farmers have seen wheat and malting barley increase significantly in value, even taking into account recent falls, not all crops – such as potatoes and sugar beet - have been so lucky.  

“Feed costs have risen by 44% which will soak up any gains made recently in the market place for milk, beef or lamb.

“Machinery costs have and are still seeing dramatic rises as any purchaser of plough metal has already found out. The cost of new machinery other than tractors has risen by between 15 and 20% depending whether it is an imported machine or not. 

“Another factor is the singe farm and environmental payments which have reduced due to modulation.  Where these form say 12% of income, the remaining income has to rise proportionately more.  The higher the proportion the payments are of farm income, the more dramatic agflation will be to future profitability.

“All of this will have an on-going impact on what the consumer pays for food.

“Purchasing groups like ours have never been more important to farmers.  We can help give them the bargaining chip on the inputs side and make their voice heard higher up the supply chain.”