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2009: Outlook Report

SAC's Rural Policy Centre suggests that agriculture is coping better with the present recession than many other sectors of the Scottish economy. While dairying faces particular difficulties the general picture is favourable, mainly due to a weaker pound supporting commodity prices and the Single Farm Payment. The global nature of the recession also promises an eventual reduction in production costs, while the world demand for food continues to grow.

A sector by sector analysis is provided in the following documents.

Key messages include:

  • The UK recession is proving good for agriculture - mainly due to a weaker £ supporting commodity prices and the Single Payment
  • The global recession has lowered production costs - through reduced demand and prices for energy and raw materials (leading to cheaper fuel, fertiliser, building materials etc) though the full benefit may not be felt until 2010
  • Global demand for food continues to grow - though some sectors particularly higher value and niche markets such as organics have suffered weaker demand
  • Credit is still available but more questions are being asked - credit restrictions have impacted on UK farming but credit is generally available for those with sound finances and a good business case
  • This could be a good time to invest in the future - due to cheap long term loans and positive long term future prospects
  • There is no room for complacency -  economic conditions and exchange rates can change quickly so producers should maintain the focus on improving production efficiency, marketing and business management

Download the Report

Outlook Report Series

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