Industry leaders respond to publication of Farming Profitability Review 2025

Farming Profitability Review 2025 is an independent six-month review led by Baroness Minette Batters. 

It sets out 57 recommendations for government and industry to strengthen the resilience and viability of farm businesses.  

The review highlights the sector’s potential to play a central role in the renewal of the country’s economy, DEFRA explained. 

Baroness Batters, a farmer and former president of the National Farmers Union (NFU), was appointed to lead the review in April 2025. DEFRA’s Profitability Unit worked alongside Baroness Batters to provide analysis and evidence to support the review. 

In the review, Baroness Batters highlights current profitability challenges, including rising input costs (energy, wages, machinery), policy uncertainty, and lack of market power for farmers in supply chains. 

The document reads that farmers feel policy and financial uncertainty undermine decisions on investment and long-term viability. 

The review calls for a “new deal for profitable farming” that balances food production, environmental delivery and economic resilience. It also emphasises the need for closer collaboration between farming, industry and government, and greater clarity and certainty for farm businesses looking to grow and invest. 

The Labour government is set to publish its formal response to the review through the Farming Roadmap in early 2026. 

The secretary of state, Emma Reynolds, has also announced the creation of a new Farming and Food Partnership Board, which she will oversee with farming minister, Dame Angela Eagle. 

‘The ball is now in DEFRA’s court’ 

NFU president Tom Bradshaw called the government-commissioned Farm Profitability Review a “thorough and complex report”. 

“Will take our time to digest the details and analyse the recommendations made by Baroness Batters to improve the profitability of Britain’s farming businesses. 

He said: “As we continue to face huge and wide-ranging challenges from geopolitical uncertainty and trade deals that threaten to undermine our marketplace, to uncertainty around the future of environmental schemes, extreme weather events, continued price volatility and the unfair family farm tax, this report is right to recognise that reform is needed.  

“Changes that will drive competitiveness and profitability, which are critical elements of thriving farming businesses, are also crucial to achieving the government’s own targets for economic growth.” 

Mr Bradshaw added that the creation of a new farming and food partnership board with profitability and food security at its heart would enhance collaboration and ensure the government and industry can work in partnership, delivering on the issues that matter most for the sector. 

“A commitment to continue working on supply chain fairness is a top priority for all farming sectors, while delivering planning reforms will help underpin growth for the industry. Refocused efforts on growing our exports is also welcome and vital to adding value for domestic producers.  

“And while private finance can play a big part in delivering new income streams and delivering for nature, we can’t hide from the fact that significant challenges remain to this beyond the pilot stage to a truly scalable market delivering financial opportunities for farmers. 

“The ball is now in DEFRA’s court. Ministers have to drive these priority areas forward. But alongside this, there are other immediate actions that are needed to boost British farming, like providing much-needed clarity and certainty on the future of the Sustainable Farming Incentive (SFI) and doing the right thing on the pernicious inheritance tax changes,” he concluded. 

‘Now is the time for urgent action’

Country Land and Business Association (CLA) president Gavin Lane said the report highlights that profitability across the sector is perilously slim, with farmers battling high input costs, low commodity prices and volatile weather conditions. 

“Many farm businesses are marginal or loss-making, yet will soon be hit with unaffordable inheritance tax bills, which in many cases will dwarf their annual profit. 

“We welcome Minette Batters’ conclusions and urge the government to work with the industry to build profitable, self-sustaining farm businesses, otherwise food production and nature recovery will be put at even greater risk.” 

Mr Lane added that “now is the time for urgent action”. “We need a stable policy environment, clarity on farming schemes, real planning reform and a recognition that a joined-up approach to rural affairs is desperately needed across government,” he concluded. 

‘Farming Roadmap should provide a clear and sustainable way forward for England’s farmers’

Martin Lines, CEO of Nature Friendly Farming Network (NFFN), said that this “valuable” review starkly illustrates the scale of the challenges England’s farmers are facing in maintaining the viability of their businesses while navigating extreme weather, climate change and market volatility.

He added: “It is particularly pleasing to see the emphasis on whole-farm approaches and improving soil health and fertility for long-term resilience, and to see nature-friendly and regenerative approaches to farming discussed positively throughout the report. We also agree that a circular economy approach to farming policy would greatly help.

“However, while Baroness Batters recognises the importance of ELMs, we do not agree that SFI cannot deliver for both food production and nature at the same time. Likewise, while we agree that increasing production of protein crops, fruit and vegetables is vital, we believe that public procurement schemes, market regulation and aligned import standards would all be more effective ways of boosting the market for these sustainable, nutritious foods than using public money to support food production.

“Ministers now need to ensure the Farming Roadmap provides a clear and sustainable way forward for England’s farmers, with full commitment to effective and ambitious ELMs schemes and investment in farming methods that work for food, nature and the climate.”

‘Farms must generate profit to remain viable’

James Farrell, head of rural consultancy at Knight Frank, added that the completion of the Farming Profitability Review brings a necessary and welcome focus to the business realities of farming.

“Farms are, at their core, businesses, and like any other, they must generate profit to remain viable. Profitability underpins the sector’s ability to produce food, sustain rural economies and deliver meaningful environmental outcomes. 

“At a time when farmers are facing significant structural and economic pressures, Baroness Batters’ recommendations for closer alignment between agricultural and economic policy, improved supply chain transparency and a fairer distribution of risk and reward point toward a more resilient and commercially confident sector. The establishment of the new Farming and Food Partnership Board, with its stated objective of strengthening domestic food production and ensuring policy delivers for farmers, is a positive first step in response to the review.” 

Mr Farrell said that as the government continues to state its ambitions for national growth, a profitable farming industry must be recognised as a cornerstone of delivery.

“With the right support, the sector can help close the £43 billion rural productivity gap identified by the CLA and acknowledged by the All-Party Parliamentary Group for Rural Business and the Rural Powerhouse. Realising this economic potential will depend on policies that value farming’s contribution and foster long-term investment, innovation and resilience,” he concluded. 

Call for protein crops to be incorporated into SFI

Roger Vickers, CEO of the Processors & Growers Research Organisation, said that the review clearly sets out the potential for pulses to help farmers build resilience, while contributing to food production with lower environmental impact and at lower cost. This ambition is fully supported and strengthened through the inclusion of pulse crops within arable rotations. 

“We welcome Ms Batters’ call for protein crops, such as peas and beans, to be incorporated into the Sustainable Farming Incentive (SFI), and her recognition of their ability to deliver multiple public goods.

“These include benefits for human and livestock nutrition, as well as reducing reliance on imported soya. Pulses are an integral part of any such strategy, and work is progressing apace to further demonstrate their value, both economically and environmentally. One example is the NCS project, a four-year project funded by Defra through Innovate UK, which hopes to increases UK pulse and legume cropping and reduce reliance on imported soya,” he said. 

Mr Vickers added that the report also highlights the need for SFI to be more closely linked to food production by incentivising farming optimisation through SFI options, including pulses and circular protein crops such as peas and beans. “It has long been a mystery to PGRO why these clearly environmentally beneficial, commercially viable cropping options have remained unrecognised and, worse still, actively excluded.

“Ms Batters further recommends the creation of a scheme for those farmers unable to access the SFI. She suggests this should include soil baselining, protein crops (peas and beans), pulses and oilseeds, alongside existing SFI options that deliver greater resilience. We would go one step further and argue that such a scheme should be available to all farmers who wish to participate,” he concluded.

Read the review here.

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