Farm incomes dropped drastically last year, as poor weather combined with the impact of the pandemic and Brexit-related issues wiped close to a billion pounds off the UK’s farming economy and increased hardship for many small farmers. Total income from farming, calculated annually by the government, fell from nearly £5.2bn in 2019 to just over £4.1bn in 2020, the lowest value in real terms since 2007. The Covid-19 lockdown last spring left many farmers reeling as their core market in supplying the catering business vanished overnight. Farmers had to pour fresh milk down the drain as they struggled to refocus on supplying supermarkets. Extreme weather also took a big toll, with heavy rain and storms early in the year preventing planting before one of the driest springs on record. The wheat harvest was down sharply, and other key crops such as potatoes suffered. Overall, there was a drop of £999m in the value of crop output, though livestock value increased by about £490m over the year. Tom Bradshaw, vice-president of the National Farmers’ Union, said: “Volatility is something farmers are used to managing but it doesn’t make it any easier to deal with, especially when there continues to be so much uncertainty about future changes to agricultural policy, and lack of clarity over new [subsidy] schemes.” Farmers are facing stringent cuts to their subsidies, as they no longer receive payments under the EU’s common agricultural policy and the government is phasing in a new system of environmental land management contracts, under which farmers will be paid for supplying “public goods” such as tree-planting, soil improvement, wildlife protection and measures to prevent flooding. Details of how the new system will work are still unclear, however, and many farmers are facing increased uncertainty because of the impact of Brexit and new trade deals. A looming trade deal with Australia is likely to open up the UK’s meat market to an influx of cheap Australian beef, some produced using methods that would be illegal in the UK. Last week, the government announced new payments of up to £100,000 for retiring farmers, with some incentives for new ones to take over. But many fear that the payments will spur further consolidation in UK farming, squeezing out small farmers in favour of huge intensive agri-businesses and factory farms. Tim Farron, the Liberal Democrat spokesperson for the environment, food and rural affairs, said: “The Tories are failing British farmers and our environment. They’re cutting support payments, offering trade deals without sufficient guarantees, and they’re encouraging experienced farmers to leave without ensuring someone will replace them. This income plummeting is down to one thing: Tory mismanagement. The Conservatives must change tack now before we see incomes dropping further and farmers going out of business.” The number of small family farms in the UK has already fallen by more than 100,000 since 1990, and many small farmers contacted by the Guardian raised fears of a greater exodus as new post-Brexit trade deals are signed. Prince Charles wrote in the Guardian this week that small farmers were essential for a sustainable future agriculture that would reduce greenhouse gases and nurture the countryside. He called on small farmers in the UK and around the world to unite in cooperatives to increase their clout and promote environmentally friendly farming methods.