UK Farmers Adapt as Subsidy Changes, Rising Costs and Falling Demand Squeeze Profits

Farmers across the UK are adapting to changing agricultural subsidies, rising costs and pressure on profit margins. Some are changing how they manage their land and livestock, while others warn that new funding schemes do not match the support available under previous programmes.

Year-round grazing helps Yorkshire farm cut costs

At Hill Top Farm, Neil Heseltine now grazes his 300 cows outdoors throughout the year. He says the change has increased the farm’s profitability and dramatically reduced the amount of time he needs to spend on the farm.

Farmers question the future of agricultural support

Although many farmers welcome the new subsidy schemes in principle, some believe the funding available is far below the level provided by previous support programmes.

“Do you see a future in the future? We don’t know where it’s going,” says James Foster, who has raised beef cattle and sheep on Bolton Abbey Estate for 30 years. “I don’t think the government wants us to, but people have to eat, so we have to adapt to that.”

Defra says an average of £2.3 billion is invested each year through its UK farming schemes. The department also claims that trade deals protect farmers and help make supply chains fairer.

Scotland shifts subsidies towards environmental benefits

Scottish sheep and field farmers face many of the same challenges, including compressed profit margins, rising costs and declining demand for lamb and mutton. The Holyrood Government is similarly moving towards a subsidy system that places greater emphasis on the environmental benefits farmers can provide.

One example is the Sheep and Trees initiative, which aims to help farmers and land managers plant more woodland without reducing herd size.

Farmers have complained that some schemes introduced in Scotland are difficult to access. Agriculture Secretary Jim Farley has pledged to review specific projects.

Earlier this year, NFU Scotland and other farming organisations also raised concerns that the government funding budgeted for agriculture is insufficient to help farmers produce food profitably while meeting climate and nature goals.

Northern Ireland sheep numbers continue to fall

Sheep numbers have declined in Northern Ireland in recent years. The latest figures for 2024 show that 1.9 million sheep were kept across the region.

The Ulster Farmers’ Union has criticised the exclusion of sheep farmers from the devolved administration’s future agricultural policy. It has called on Northern Ireland’s Department of Agriculture, Environment and Rural Affairs to engage with the industry.