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When the latest Total Income from Farming (TIFF) figures are published each year, they tend to generate a predictable reaction. A single headline number emerges, comparisons are drawn with previous years, and conclusions are quickly formed about the overall health of Scottish Agriculture Plc.
This year is no different. The initial estimate for 2024 points to a sharp recovery in income, with total farming profit rising significantly after a difficult 2023. On the face of it, that is welcome news. After a prolonged period of volatility, rising costs and sustained pressure on farm businesses, any improvement is something to recognise.
But if we stop at the headline, we risk misunderstanding what these figures really tell us and, more importantly, what they don’t.
The annual TIFF figure is a useful measure. It provides a broad, aggregate picture of profitability across the whole sector. It captures the total value of agricultural output, adds support payments, and subtracts costs to give an overall estimate of income. As a high-level indicator, it has its place.
However, Scottish agriculture is anything but uniform, and a single aggregate figure cannot reflect the reality experienced on individual farms and crofts. Beneath that headline number lies a wide spectrum of outcomes. Different sectors, different regions and different types of business are all operating under very different conditions. What looks like recovery at a national level may feel very different on the ground.
Livestock producers in more marginal areas, for example, continue to face structural constraints that limit profitability. Arable businesses may be dealing with yield variability or market uncertainty. Smaller and more specialised enterprises often have less capacity to absorb shocks. TIFF does not distinguish between these experiences, it averages them.
That is why it is so important to treat the headline figure with caution. It is not that the number is wrong, it is that it is incomplete.
Looking more closely at what is driving the reported recovery in 2024, the picture becomes more nuanced. Much of the improvement appears to stem from a reduction in input costs following the exceptionally high levels seen in previous years.
But this is not the same as a strong or stable recovery in output. Output values themselves are broadly stable rather than significantly increasing. In other words, the improvement is being driven more by a temporary easing of pressure than by sustained growth.
That distinction matters, because input cost volatility has been one of the defining features of recent years – and no more so than in recent weeks.
One of the most important aspects of the TIFF figures is the role of support payments. A substantial proportion of farming income in Scotland continues to come from public support. In the latest estimates, that contribution remains significant, accounting for a large share of overall profit.
This is not a new phenomenon, but it is one that deserves continued attention. Support payments are not simply an addition to farm income. For many businesses, they are fundamental to viability. Without them, particularly in less favoured and more remote areas, many farms and crofts would struggle to continue operating.
At the same time, the real value of that support is being eroded. Payments that have flatlined in cash terms are worth less each year in the face of inflation. Costs, meanwhile, have risen sharply over the past decade and continue to do so.
The result is a growing disconnect between the financial pressures farmers and crofters face and the support available to help manage them.
Again, this is not immediately visible in the headline TIFF figure. The aggregate number includes support, but it does not highlight how dependent overall profitability is on that support, nor does it show how that dependency varies.
Another important consideration is timing. TIFF is, by its nature, a retrospective measure. The estimates for 2024 are based on data that is still being gathered and will be refined over time. More importantly, they reflect circumstances that have already changed.
There is a risk that the apparent strength of the headline TIFF figure could be misinterpreted, particularly by those who are less familiar with the day-to-day realities of farming and crofting. A strong recovery in aggregate income might suggest that the sector is in a comfortable position, or that the need for support is diminishing. Neither conclusion would reflect the underlying reality.
The truth is more complex. Scottish agriculture has shown resilience in the face of significant challenges, and that should not be underestimated. But resilience does not mean immunity from pressure. Many farm businesses remain finely balanced, with profitability dependent on factors that are often outside their control.
For policymakers, this underlines the importance of looking beyond aggregate measures when assessing the health of the sector. TIFF has its value, but it should be considered alongside more detailed data on farm-level incomes, sectoral performance and regional variation. Only by understanding that wider picture can effective and targeted policy decisions be made.
For those within the industry, the message is equally clear. The latest figures may offer some reassurance, but they do not change the fundamental challenges facing Scottish agriculture. Volatility, input cost pressures and reliance on support remain defining features of the landscape.
What is needed is a more informed and balanced conversation about what these figures mean. A recognition that behind every headline number are thousands of individual businesses, each with their own circumstances, challenges and opportunities.
If we are to build a profitable and resilient future for Scottish agriculture, we must base our decisions on a full understanding of that reality. That means asking deeper questions, examining the detail beneath the surface, and resisting the temptation to draw simple conclusions from complex data.
It is not headlining figures that define our sector. It is the strength, viability and confidence of the farms and crofts that make it up.