Farming Profitability Review 2025

The Farming Profitability Review led by Minette Batters, examined the financial, structural, environmental, and policy-related challenges for UK agriculture, outlining 57 actionable recommendations in response.  Commissioned by DEFRA in April 2025, the review highlighted increasing economic pressures, rising production costs, volatile markets and ongoing policy uncertainty that has left many farmers questioning the future viability of their businesses.

It highlights the paradox of UK agriculture, whereby while farming remains a vital economic sector and backbone of the wider national agri-food supply chain, the industry has been marginalised and experienced a sustained decline in domestic food production.

What Does it Mean For Farmers And Landowners?

Farmers and landowners face a challenging environment of rising costs, tougher regulation, and increased market exposure. The review recognises these pressures and calls for a “New Deal for Profitable Farming” designed to put domestic food production and farmer viability at the centre of policy.

Key implications include:

• Rising costs continue to hit margins – with energy, labour, fertiliser and machinery costs forecast to be 30% higher in 2026 than in 2020, farmers face sustained financial pressure.
• Regulatory demands are increasing, yet the core farming budget of £2.4 billion has not changed since 2007, meaning farmers are being asked to deliver more environmental and welfare outcomes with the same level of support.
• Post‑Brexit trade deals increase uncertainty, potentially driving cheaper imports produced to lower standards, creating additional competitive pressure.
• The review strongly argues that UK farmers must not be undercut by imports produced to weaker welfare or environmental rules, and that farmers must have a formal voice in trade negotiations.
• A system-wide approach is proposed, ensuring that farming, environment and food policy are coordinated and that farmers have a seat at the table.

Overall, it means more clarity, stronger representation, improved fairness, and a renewed emphasis on profitable food production.

What Are The Key Recommendations And How Will They Affect Farmers?

1. A New Governance Structure: More Farmer Representation

Key recommendations:

• Establish a Farming and Food Partnership Board – DEFRA has already committed to this.
• Create a National Food and Farming Plan to coordinate long‑term strategy.

How it affects farmers:

• Farmers gain stronger influence over policy, trade discussions, and long‑term planning, bringing together farmers and supply-chain stakeholders.
• Improved stability with fewer sudden policy changes.
• More coordinated cross-sector decisions across food, farming and environment.

2. Fairer Markets & Supply Chains

Key recommendations:

• Extend supply‑chain fairness rules (GSCOP) beyond supermarkets.
• Establish the Great British FARM Advisory Board (GBFAB) to bring together industry experts to make supply chain investment decisions and facilitate the shared vision.
• Improve transparency in pricing through enhanced market monitoring.
• Ensure trade deals protect UK farmers from low‑standard imports.
• Strengthen British origin labelling – ‘Great British Brand’ campaign.
• Domestic marketing through ‘Food and Drink England’.

How it affects farmers:

• Fairer contracts, fewer hidden clauses, and more protection against late payments.
• Better visibility of market prices helps farmers negotiate more confidently.
• Reduced risk of being undercut by cheaper, lower‑welfare imports.
• Clearer labelling supports consumer trust in British produce.

3. Financial Protection & the Active Farmer Principle

Key Recommendations:

• Apply the Active Farmer Principle – an eligibility framework – to ensure funding only goes to those genuinely farming.
• Improve access to finance through targeted tax reforms and grants.

How it affects farmers:

• Ensures public money rewards active farm businesses, not passive landowners.
• More accessible finance for young farmers, new entrants and business expansion.
• Better‑designed grants that reduce risk and administrative burden.

4. Infrastructure, Planning & Investment

Key recommendations:

• Streamline planning for reservoirs, barns, slurry stores, polytunnels and greenhouses.
• Produce a national Planning for Food Infrastructure Blueprint.
• Expand permitted development rights for essential farm buildings.

How it affects farmers:

• Faster, cheaper, more predictable planning decisions with reduced barriers.
• Easier to invest in water security (reservoirs), energy (wind/solar), modern livestock housing and protected cropping including greenhouses and polytunnels.
• Improved resilience to droughts, storms and extreme weather

5. Environment, Climate & Natural Capital

Key recommendations:

• Incentivise carbon reduction, biodiversity enhancement and improved soil health.
• Support water management schemes and catchment‑scale planning.
• Build environmental metrics into farm support in ways that complement food production.
• Establish ‘SOILSHOT + NATURE’ as a whole farm approach, supported by a private funded scheme.

How it affects farmers:

• Opens new income streams from carbon, biodiversity and soil‑health markets.
• Aligns environmental actions with profitable farming rather than replacing it.
• Provides clearer guidance on meeting environmental regulations.

6. Skills, Advice & Farm Support Services

Key recommendations:

• Establish a Sustainable FARM Service: a single hub for advice, training, grants and technical support through a farm advisory service.
• Expand training in business management, sustainable practices and technology.
• Increase support for new entrants, apprenticeships and digital skills.

How it affects farmers:

• One simple access point for rules, funding, advice and scheme applications.
• Higher‑quality technical and business support reduces costly errors.
• Better skills for the next generation build long‑term resilience.

7. Innovation, Technology & Labour

Key recommendations:

• Support automation and robotics, especially in horticulture.
• Implement labour‑force reforms, including extending Seasonal Worker visas.
• Boost research and development tied to real farm needs.

How it affects farmers:

• Reduced reliance on an unstable labour market.
• Potential to lower production costs through automation.
• Improved access to digital tools and precision technologies.

8. Risk Management & Extreme Weather Preparedness

Key recommendations:

• Strengthen emergency frameworks for flooding, drought, disease outbreaks and supply‑chain shocks.
• Improve market volatility tools and risk‑monitoring systems.

How it affects farmers:

• Better protection against weather and market shocks that can wipe out profitability.
• More timely support during crises.
• Clearer planning for long‑term resilience.

Overall, the review calls for government to work in genuine partnership with farmers, build economic resilience into the sector, and deliver a long‑term plan capable of restoring profitability, enhancing national food security, and supporting the wider rural economy.

Environmental Impact Plan (EIP25)

The government has also published a revised Environmental Improvement Plan (EIP25), released in December 2025 as the latest update to EIP23 and original 25-Year Environment Plan. EIP25 sets out a five year roadmap for meeting Environment Act 2021 targets, including 10 goals and 91 commitments within an overarching aim of restoring nature. The goals focus on improving environmental quality (air, quality and chemicals), waste and resource management, climate and hazard resilience, biosecurity, and public access to nature.

Please find Chloe Timberlake’s full article for more details here – Land Journal, 2026.