A new report from cross‑party think tank Demos, supported by McCain Foods, warns that the UK food system is under mounting pressure. But it also highlights a significant economic opportunity if farmers transition to sustainable practices.
One finding of ‘The Sustainable Farming Dividend’ report found adopting sustainable farming methods could increase UK farm profits by £1.6bn annually by 2035. This uplift could play a critical role in stabilising an agricultural system where almost one in five farms currently operate at a loss.
The report argues that regenerative and nature‑positive farming approaches not only benefit the environment but are one of the clearest pathways to restoring profitability across the sector. By improving soil health, reducing reliance on costly inputs and enhancing resilience to climate volatility, these practices could generate billions in value across the £150bn UK agri‑food sector.
A clear financial case for change?
The report sets out a food system facing unprecedented stress: rising input costs, uneven farm incomes, and ongoing uncertainty around agricultural policy. Against this backdrop, Demos highlights a series of major economic benefits that sustainable farming could unlock by 2035, including:
- £56.3bn in natural capital gains through nature restoration
- £905m annual reduction in total input costs
- £449m less reliance on imported fertiliser, at a time when 60% of nitrogen fertiliser is sourced from overseas
These gains, the authors argue, amount to a substantial national economic opportunity and a compelling reason for government to accelerate the transition.
Public backing is strong as long as the links are clear
One of the report’s insights is the public’s readiness to support the shift to sustainable agriculture. Awareness may currently be low, but when the connections between farming, climate impacts and food prices are explained:
- 61% of people support greater government investment in sustainable farming
- 45% believe it should be prioritised over other spending areas
- 31% say they would view the government more favourably if investment increased
The authors argue this presents a “window of opportunity” for decisive political action.
A call for coordinated national leadership
To deliver what Demos calls a “sustainable farming dividend”, the report urges government to:
- Build strong partnerships
Scale up farmer clusters, develop regional Agri‑Growth Hubs and embed co‑design principles into the management of council-owned farmland.
- Support nature outcomes
Create standardised baselines for carbon, soil, water and biodiversity to give farmers clearer guidance and accountability.
- Close the knowledge gap
Commission a Skills England review to identify training needs and embed understanding of sustainable practices across the sector.
Former Food Security and Rural Affairs Minister Daniel Zeichner MP said the findings underline why sustainable farming must be recognised as “a cornerstone of our national economic and food security,” rather than a niche environmental concern.
Farmers cannot shoulder this transition alone
McCain GB&I’s VP of Agriculture, James Young, said the report reflects growing pressure on the company’s 250 British growers:
“Farmers are feeling the pressures of climate volatility and know the transition to a more sustainable system is essential… but what is clear is that farmers cannot be expected to make this transition alone.”
He emphasised the need for “long-term policy certainty and the right incentives” to support grower confidence and investment.
Demos lead researcher Dan Goss added that sustainable farming is fundamentally an economic issue:
“Britain cannot build a secure economy on depleted land and fragile food systems… Sustainable farming is about protecting the foundations of our economy and the financial security of citizens.”
A decisive moment for UK farming?
With strong public backing, clear economic benefits and a sector increasingly affected by climate and market volatility, the report argues the UK has a rare opportunity to take coordinated national action.
If government acts decisively, the authors say, sustainable farming could not only restore nature but also put billions back into farmers’ pockets and reinforce the long-term stability of UK food production.
