FARMING businesses are looking forward to a profitable 2014 with expectations for sales and profits higher than the previous 12 months, according to the Country Land and Business Association’s latest survey on the rural economy.
Its Rural Economy Index, which is produced by the CLA in conjunction with surveyors Smiths Gore, provides a quarterly insight into the business environment of the area’s economy.
A sample of rural businesses from all regions in England and Wales are surveyed although agricultural and non-agricultural businesses are analysed separately.
The December survey reports that financial growth spread from non-farming businesses to the farming sector during the final third of 2013, with more farming businesses reporting rising rather than falling sales for the first time in a year.
Agricultural businesses expect profitability to be higher in the next 12 months with the net balance rising to 11 per cent. Profit expectations for non-agricultural businesses have risen by a record net balance of 48 per cent – their highest levels since the survey began in 2012.
Rural businesses, such as property and tourism enterprises, reported a more positive outlook with nine per cent more non-agricultural businesses expecting to employ more people during the year ahead and farming expecting to hold its own and continue employing the same number of people as it did in the previous 12 months.
CLA South West director John Mortimer said: “Recovery in the rural economy now seems firmly rooted and we can look forward to 2014 with greater confidence.
“With confidence hit by bad weather, poor harvests and the rising price of livestock feed, farming has been in the doldrums during the past year, but for most farming businesses the pessimism of the past 12 months has now gone and they are now looking forward to higher sales and profits in 2014.”
The CLA believes that, in order to keep confidence high and to drive the rural economy forward, the government should implement the MacDonald task force recommendations in full.
That, said Mr Mortimer, would reduce the negative impacts of over-regulation and free farmers to get on with the job of running profitable businesses.
Smiths Gore’s Head of Research, Dr Jason Beedell, said: “Business support is very important to sustain the recovery and the investment strategies being prepared by Local Enterprise Partnerships right now must support rural businesses.
“Rural businesses need to understand this funding and work with their LEPs to ensure it supports them.
“The rural economy is significant – with 28 per cent of all British businesses and a quarter of the population.”