East Anglia's arable farmers face a drop in profits of more than 50pc for harvest 2023 due to falling grain prices, dwindling subsidies and inflationary cost pressures.

Modelling work by rural agency Strutt & Parker shows the net margin for an average arable farm is expected to be £183 per hectare this year, down from £568/ha in 2022.

The 2023 net margin for a higher-performing farm achieving higher yields and with lower fixed costs is forecast to be £364/ha, but this will still be 52pc lower than in 2022 and 42pc lower than in 2021.

The figures are attributed to a collapse in wheat prices, which have fallen to less than half of last year's peak which followed Russia's invasion of Ukraine, in one of the world's major wheat production areas.

Other economic factors affecting East Anglia's wheat and barley growers include recent high prices for fuel and fertiliser and the reduction in EU subsidy payments which are being phased out after Brexit in favour of a new system of environmental incentives.

Andrew Atkinson, farm consultant with Strutt & Parker, said: "Harvest 2022 was a profitable year for arable growers who purchased the bulk of their inputs before the massive increases in input costs and benefited from the significant increases in grain prices.

"But the huge rise in fertiliser prices which followed, along with declining commodity prices over recent months, means harvest 2023 could end up being one of the worst financially for a number of years.

"Volatility is not new to farmers, but the extent of it really has been unprecedented over the past 24 months and it is this year where the pain will be felt on many arable farms.

"Arable farmers will be feeling like they have been on a rollercoaster and that looks set to continue.

"The forecast for 2024 is better than this season, but still worryingly low, which puts pressure on businesses to look for areas where they can improve financial and technical performance."