The exchange rate to be used for direct farm payments in 2016 has increased, meaning farmers will see a significant increase in EU support this autumn.
The 2016 exchange rate will be €1 = £0.85228, an increase of around 17% compared with last year, calculated on the average of the European Central Bank rates set over the month of September.
The decision affects around 16,500 farmers who have chosen to receive their 2016 basic payment scheme support in sterling.
Rural Economy secretary Fergus Ewing said farmers who received support in sterling would see an increase of approximately 15% when compared to the 2015 rate, after taking account of financial discipline arrangements.
He said: “This marks an increase for the first time in three years and is to be welcomed given the current challenges facing rural Scotland.”
The news was also welcomed by NFU Scotland’s director of Policy Jonnie Hall.
“Continued uncertainty about the impact of Brexit has weakened sterling against other currencies, including the Euro. Although that had helped strengthen the competitiveness of UK exports, prices for agricultural goods remains too low. Today’s exchange rate setting provides at least some good news for support payments,” he said.
“Given the desperate situation many farmers and crofters in Scotland are facing with low prices, increased output costs and challenging weather, this will be a welcome boost at this time of year.”
