Total income from farming: estimates for Scotland 2014-2016

7. Production indices

Table 5 shows four different production indices. To produce these, income and expenditure accounts (similar to TIFF) are calculated based on constant prices. The percentage annual changes in these is calculated, which are then converted into indices.

• The Output Index looks at how the volume of output changes over time. It doesn't take into account capital formation, and is not affected by whether commodities have received coupled support.
• The Input Index looks at most items of input, hence how the volume of input changes over time. It doesn't however take into account spend on contract work, interest or taxes on production.
• Total Factor Productivity Index calculates the ratio of outputs to inputs, in line with that published at UK-level by DEFRA.
• The Gross Value Added Index is a volume-based indicator of the economic size of the industry, used in GDP calculations. As with the other indicators, it is not, strictly speaking, affected by the value of commodities, other than in terms of the weight given to each element within the calculation. This index is therefore different from the Gross Value Added figure included in Table 1.

The three indicators, excluding Input, show fluctuating growth compared to the base year 2000. Initial growth until 2006 has stuttered, with dips in 2010 and 2012, but with more recent years showing some positive signs.

Chart 9: Production indices, 2000 to 2016