POSITIVE INCOME FIGURES REFLECT REDUCED INPUT VOLUMES AND OUTPUT GROWTH RATHER THAN STRONG PRICES – IFA

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POSITIVE INCOME FIGURES REFLECT REDUCED INPUT VOLUMES AND OUTPUT GROWTH RATHER THAN STRONG PRICES – IFA
26 May 2015

POSITIVE INCOME FIGURES REFLECT REDUCED INPUT VOLUMES AND OUTPUT GROWTH RATHER THAN STRONG PRICES – IFA

Economics, Farm Business & Credit

IFA President Eddie Downey said that the slight increase in average farm incomes in 2014 reflected the drop in input volumes due to good weather conditions compared with the previous years, rather than strong product prices.
Mr Downey was responding to the results of the Teagasc National Farm Survey, which showed that farm incomes in 2014 increased by 6%. He said, “It must be remembered that the fodder crisis of 2013 resulted in a huge increase in feed and fertiliser expenditure, in particular. Last year’s input figures returned to a more normal basis, while production increased in many sectors also.

Despite this, we see that incomes for cattle finishers was back significantly in 2014, due to a fall of over 10% in finished cattle prices. While cattle rearing and sheep farms experienced an increase in prices last year, average incomes in these sectors remain very low, ranging from €10,000 to €15,000”.

Tillage farmers experienced no real change in income, despite a very strong year for growth, as prices fell. Mr Downey said, “2015 is looking to be a very difficult year for our tillage farmers for the third year running as prices have weakened and yield prospects are average.”
For the dairy sector, Eddie Downey noted that, while 2014 was a positive year, many farmers will be under significant cashflow pressure in 2015 due to much weaker prices and the first payments of superlevy.

Mr Downey concluded, “The Teagasc figures show clearly that profitability at farm level remains a major challenge in many of our sectors. IFA has made clear that actions to improve farm profitability, both within and outside the farm gate, must be prioritised by all stakeholders in the new Agri-Strategy 2025”.

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