The agricultural operating surplus has declined by 36%, or €1.7 billion, to €3.0 billion last year, according to latest figures by the Central Statistics Office (CSO).
This is mainly due to a sharp decline in the value of milk and cereals. Milk prices fell by 26% and, when combined with a 4% drop in volumes, the value of milk fell by 30% to €3.5 billion.
While cereal prices fell by a third, a 6% decline in the area planted combined with unfavourable weather led to a 26% drop in output. Thus, the value of cereals fell by 48% to €362 million.
The CSO published its Output, Input and Income in Agriculture – Preliminary Estimates 2023 report today (Monday, March 11). Final estimates will be published in June 2024.
Agricultural operating surplus
The operating surplus is calculated by subtracting compensation of employees from factor income. The figure is comprised of the operating surplus earned by farmers and that earned by contractors.
It is an estimate of income before deductions for interest payments on borrowed capital, land annuities and rent paid by farmers to landowners for the use of their land, the CSO said.
The value of agricultural output at basic prices fell by 13% to €11.2 billion. This comprises goods output at producer prices, the value of contract work and subsidies, less taxes on products.
Intermediate consumption costs declined by €383 million, or 5%, to €7.5 billion. The cost of fertilisers fell by 32% to €817 million, with lower prices accounting for 22% of this decline.
Other subsidies less taxes on production declined by €316 million last year. Other subsidies on production include, for example, the Basic Income Support for Sustainability (BISS).
Compensation of employees costs grew by €25 million in 2023. This includes remuneration in cash and “in kind”, but excludes the remuneration of the farm owner or non-salaried family members.
Livestock value
While cattle prices grew by 3%, cattle volumes contracted by 4% last year. Thus, the value of cattle decreased by 1%, or €25 million, to €3.0 billion, according to the CSO.
The CSO currently estimates that there was no significant change in the value of sheep last year, as a 3% increase in volume was negated by a similar drop in prices.
The impact of stronger pig prices, which were up by 19%, was moderated by lower volumes, resulting in the value of pigs rising by 7%, or €46 million, to €667 million.
Higher poultry prices, which rose by 5%, combined with larger volumes saw the value of poultry grow by 8%, or €17 million, to €221 million last year, preliminary estimates for 2023 show.