THIS week, I read two reports that give credence to the generally-held belief that we are struggling to make any profit in farming.

I accept that there will be a few family-run farms with a highly-committed workforce that will still be nicely in the black but, for the bulk of farmers, trying to find a production enterprise that pays is getting more difficult; and both reports bear this out.

The first, from Lawrence Gould Farm Management Partnership, places emphasis on non-farming activities to support the business and the survey indicates that income from outside the traditional agricultural enterprises has increased by nearly five times in the last five years; and that the average contribution from non-farm income is now 10pc of turnover.

The second report, from the national firm of accountants Deloitte and Touche, covers over 1,000 farms surveyed for profitability. Here are a few of the salient points to digest and against which to measure our individual achievements:

- Average profitability across the whole survey was just £18/acre, so a 1,000-acre farm could expect to yield a profit of £18,000 this year. Don't forget, this is to cover not only drawings for the partners but also much-needed expansion; and, needless to say, vital re-investment is just not happening.

- Deloitte and Touche is forecasting that next year, average profitability will fall even lower, to £12/acre.

- Only 50pc of farm output is generated from food production; and the other half now comes from non-farming activities. This compares with five years ago when 70pc of the output came from food production and this contributed most of the profit at that time.

- 55pc of all traditional farming activities now produce an average loss of around 50p/acre.

Statistics never tell the whole truth, but these two reports by respected national firms are indicative of a trend which must be worrying. If food production has ceased to be profitable, then it is not going to be long before many involved in agriculture will turn their backs upon these traditional enterprises.

Continuing with the argument, we would end by losing a lot of food production, which would then give the supermarkets et alia the most justifiable reasons for purchasing everything from abroad.

It absolutely infuriates me to think that farmers are being reduced to accepting subsistence levels for producing food when the supermarkets quite blatantly insist on a 30pc profit which they refuse to share with us.

I believe Mark Hudson, the deputy president of CLA, is quite right when he says there is a serious imbalance in the market caused by the unreasonable buying power of the large supermarket chains; and that we must join forces to break this stranglehold.

My old friend Holgate Illingworth popped in a market report from August 1987 and, bearing in mind that it's only 15 years ago, the price differential to today's market is the more discouraging.

- Wheat for November was forecast at £106/tonne and barley £101/tonne.

- Potatoes were running at £55/tonne to £100/tonne.

- Pigs were at 103p/kilo liveweight and cattle 98p/kilo liveweight.

For those who can remember, John McGregor was then minister of agriculture and would that he were in charge now instead of this dreadful crew!

I suppose this sub-heading is wishful thinking, but I really have less and less time for Elliot Morley as he relentlessly pursues his one-man campaign to keep the 20-day movement standstill on farms.

Defending the indefensible in the House of Commons, Mr Morley labelled Conservative MPs as irresponsible, whereas, in reality, it is Morley himself who shoulders the burden for continuing with a policy that is unnecessary, unviable and has already been abandoned north of the border.

Perhaps he would like to tell us what is different about Scotland?

As David Curry put it: "Does my honourable friend think that, in Scotland, it is the sheep, the farmers, or the politicians that are more intelligent then their counterparts in England!"

I am afraid, as with many laws introduced by this Government for the countryside, this one is getting more impractical as time goes on and they are forcing law abiding citizens to breach legislation.

There are quite a few oddments for this week's column:

Record harvest - John Sawkill gave me a copy of the latest forecast for this year's grain crop in the EU. Wheat production is up by nearly 15pc, although barley has only marginally increased. Interestingly, it is the UK which is responsible for a lot of the bulge, in that our total wheat production has gone up by 43pc.

Illegal import update - Alison Reeves of DEFRA has been put in charge of the programme for the Illegal Imports Action Plan. Having come across Ms Reeves on the odd occasion, she seems a competent and reasonable person to be in charge, but I have to say that we want to see some more activity.

So far, a grand total of two sniffer dogs have been taken on to root out illegal products at airports and apparently have had a bit of success, but they have only been on the job since September 16!

Another perceived offensive measure has been the production of two videos which will be used for in-flight display but, again, these are now stuck at the British Advertising Standards Council awaiting their approval, for heaven's sake.

In addition, I gather the content of the films merely points out the potential disease risks of buying produce in different countries and does not explain which food products are illegal to bring into our country. The excuse for not doing so is that this may change over time!

In terms of action, it seems a drop in the ocean compared to Elliot Morley's continuing battery against the farming fraternity.

Germany breaches BSE rules again - Although there seems to be pages of news about French concern over BSE in Britain, it seems to go unnoticed that, for the 15th time, France and mainly Germany have breached EU rules by sending consignments of beef to the UK in which specified risk material has been found.

Even if Tony Blair has failed in his one-to-one confrontation with Monsieur Chirac, one would have hoped that his own opinion of his world ranking would enable him to persuade the European Commission to take action in such matters!

Figures show that beef imports for 2002 are expected to be 5pc higher than last year and now account for around 30pc of total supplies.

Milk quota uncertainty - Dairy farmers are in some difficulty over the milk quota situation. Numbers of cows have diminished but, on the other hand, milk production has risen. If even more milk is produced this winter then we shall be in a surplus situation but the profitability is such that many do not want to invest in or acquire milk quota.

Currently, the price for leased quota is hovering just over 2p/litre with sales at 16p/litre to 17p/litre.

One or two old faces appeared in the auction on Tuesday - Neil Ogden of Kepak, Wakefield, Ian Driver and Roy Schofield. Tuesday's market saw 117 cattle forward, including 59 OTM, 790 sheep including 230 ewes and rams.

Young bulls med to 103p/kilo, S & M Marshall, Pockley, averaged 95.70p/kilo; heavy to 107p/kilo, G W & K T Hutchinson, Ganthorpe, averaged 91.60p/kilo; others 88p/kilo averaged 83.60p/kilo.

Steers lightweight to 116p/kilo, E Dodsworth & Sons, Harome, averaged 107p/kilo; med to 130p/kilo, A Marson, Hunmanby, averaged 102p/kilo; heavyweights to 109p/kilo, B & J Gray, Fryup, averaged 92p/kilo; others to 86p/kilo averaged 84p/kilo.

Heifers lightweight to 96p/kilo, B Hornsey, Coulton, averaged 95p/kilo; med to 139p/kilo, G Marwood, Harome, averaged 112p/kilo; heavy to 98p/kilo, Mrs I Sellars, Pickering, averaging 88p/kilo; others to 85.5p/kilo averaged 83.4p/kilo.

Sheep standard 105.6p/kilo, R W Tennant, Driffield, averaged 97.20p/kilo; med to 110p/kilo, D Earnshaw, Salton, averaged 98.2p/kilo; heavys to 102.80p/kilo, M & J Hayhurst, Kirby Misperton, averaged 94.6p/kilo.

Ewes to £59 to J R Thompson, Oswaldkirk, averaged £37.

Updated: 10:02 Thursday, October 31, 2002