Ifac’s 2022 Irish Farm Report has revealed that 77% of dairy farmers have a positive outlook for the dairy sector, as overall dairy production increased by 6% in 2021. The net margins for dairy production additionally rose by 15.1c/L. The report entitled ‘Innovators – farmers embracing change’, contains Ifac’s fourth annual Irish farm survey.
The report also shows that milk prices were up 16% on the previous year, while 13% of dairy farmers are looking to decrease stock numbers in the coming years, mainly due to rising costs of inputs which are challenging farmers. Production costs, which are up by between 6-8c/L, were cited by farmers as their biggest challenge. The current input status which sees fertiliser up by more than 120% and feed prices up over 25% has led to further concerns within the farming sector as farmers are anticipating increases due to economic uncertainty.
The report found that farmers tend not to shop around when purchasing feed, fertiliser and other key inputs.
While a strong milk price and stable payments are expected to continue through 2022, dairy farmers will need to manage their business conservatively in the coming months, building up a ‘rainy day’ fund and minimising unnecessary capital expenditure until the economic outlook becomes clearer.
Other key findings in the report are as follows:
- 52% said input costs and 31% said environmental issues were the biggest challenge
- 33% unsure if they will participate in the Basic Income Support for Sustainability (BISS) environmental scheme
- 96% see reducing greenhouse gases as important