Livestock farms may recover from recession as quickly as they went into it, helped by revived demand for meat and milk products at a time of low grain prices, Genus has said.

Dairy and protein producers had a dismal year, undermined by "extremely high" feed prices and an inability to cut output in line with the drop in consumption as recession bit.

"Demand for all agricultural products has fallen and, with supplies relatively static, prices have also fallen, in some cases sharply," the UK animal genetics group said.

'Rapid' price rises 

However, a market rebound, set to start during the first half of next year, "has the potential to be" as steep as the decline, as consumption revives at a time when farmers are cutting back.

"We expect prices to rise rapidly as industry capacity is reduced, simultaneously with demand returning to its pre-downturn level," Genus said.

"The recovery from the recession in agriculture will be sharp as livestock markets recover from the economic downturn and feed costs ease."

Market dynamics 

The arguments in favour of agriculture's bright future remained undiminished, the group said, with growth in population and wealth raising demand.

Genus also highlighted the continuing consolidation among farm operations to create big producers which are the group's target market.

The comments came as the company reported 15% rise to £32.0m in earnings, excluding one-off charges, with the increase reflecting in the main currency movements.