Half of farmers considered leaving the industry after government introduced punishing inheritance tax changes, while profit margins are squeezed
Low profits, long hours, and mental strain are casting doubt over the farming industry’s future, showed a new report by frozen food giant, McCain Foods.
The McCain UK Farmdex report found that many farms are making no profit at all, with 35% of farmers making a loss or breaking even. This is the case even for the highest valued farms, with 28% of those with farms valued at £2.5m or more reporting a loss or no profit in the past year.
Increased input costs were the biggest financial pressure facing farmers (72%), followed by changes to government grants and payments (60%), and inheritance tax (54%).
McCain Foods said these financial pressures were casting doubt over the future for farmers. So much so that over half of the farmers (51%) surveyed for the report considered leaving farming in the past year due to financial constraints.
The farming community have lobbied hard against changes to inheritance tax (IHT) since the Budget announcement last October to remove IHT free status. At the forefront of these concerns has been the National Farmers Union (NFU).
The NFU has produced various member reports on the impact of the IHT changes with a March 2025 report finding that 85% of landowners believed the reforms to agricultural property relief (APR) and business property relief (BPR) would increase their IHT liability.
Responding to the McCain report, Tom Bradshaw, president of the NFU, said: ‘The results of this survey are not surprising and highlight the stark realities of farming in 2025.
‘Farmers and growers are continuing to face huge challenges from price volatility, extreme weather, uncertainty around the future of environmental schemes and changes to inheritance tax, which are impacting hugely on mental health and left confidence within the sector at a record low.
‘With the Budget just weeks away, our message to government is clear, look at the alternatives on offer to the family farm tax and deliver policies that will help build resilience, profitability and productivity in the farming sector and allow farmers to invest. In turn, we can continue to produce more sustainable, climate-friendly food, meet our domestic environmental targets, and deliver national food security.’
McCain found that pressures on farmers were affecting their mental health. Some 61% said their work negatively impacted their mental health, with 36% worked over 70 hours a week during peak seasons.
Nearly all farmers (92%) said that government policies were one of the greatest threats to the long-term growth of farming, the report found.
McCain urged the government to support regenerative agriculture, increase food security and farmer profitability, and provide certainty on policy direction and funding, to ensure the long-term viability of family farms, and guarantee fair trade deals.
James Young, vice president of agriculture at McCain GB, said: ‘Farming is the foundation of Britain’s food system, and its importance to our economy and national food security cannot be overstated. Farmers across the UK are facing a number of complex challenges, and yet they continue to showcase unwavering resilience.’
The survey of 200 farmers was conducted online between 14 and 18 July 2025.
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