It appears that cost escalation is not evenly affecting all farm sectors in Ireland. Following a review of Teagasc’s update to its Situation and Outlook for Irish Agriculture 2022 report, the Irish Cattle and Sheep Farmers Association (ICSA) has noted that dairy farm incomes are estimated to be 10 to 15 times greater than those earned by cattle and sheep farmers in 2022.
ICSA president Dermot Kelleher has called on Teagasc to clarify its forecasts for net margins on beef, suckler and sheep farms for 2022.
Teagasc forecasts that the average income on suckler farms will fall by 25% this year due to the spike in input costs, while other beef enterprises are set to experience income reductions of around 16%. Sheep farmers could also see their incomes fall by around 20%.
The report writers indicate that the ongoing surge in global dairy commodity markets will largely insulate milk producers from any major income losses.
In Kelleher’s view, “The reality is that the Government is not facing up to the fact that he beef, suckler, and sheep sectors are much more vulnerable than the dairying sector. The dairying sector is being supported in every conceivable way by dairy processors, but the same is not true in the meat sectors. We see that the dairy sector is looking at a milk price double what it was six years ago, and dairy farmers are entitled to that. But the beef and sheep sectors are not getting that level of increase and ICSA has made it clear that beef price needs to beat least €6/kg.”
He added that it is vital that the Government gets a full picture of how input cost escalation is not evenly affecting all farm sectors. Kelleher said the report suggests that the net margin will be down by 25% on sucklers and 16% on beef farms, whereas it shows that sheep farmers will have a net margin of €110/ha.
Kelleher points out that, if such a large gap in incomes between dairy and beef and sheep farmers is to be the case this year, “Then the entire CAP strategy of the Government will turn out to be a farce, as it has completely failed to adequately support lower income and lower intensity farm systems.”