The Association of Farm and Forestry Contractors in Ireland (FCI) has said that a “difficult year” for its members requires understanding from farmers.
The FCI said that 2023 has been a difficult year so far for agricultural contractors following almost two months of heavier-than-normal rainfall across many areas of Ireland.
Many agricultural contractors are still sowing spring cereal crops, and forage maize, in challenging conditions, according to the association.
“For many contractors, this weather effect will mean two to three weeks of huge demand for their services, as farmers aim to prioritise the harvesting of their individual grass silage crops while others strive to get crops into the ground.
“Farmers and their advisors need to understand that each silage contractor’s priority is to get through the grass harvesting work in the fastest possible time, with no machine breakdowns or safety concerns,” the FCI said.
The association is predicting that there will be an immediate follow-up demand for slurry spreading services, which it said will “push driver resources to the limit”.
“Driver resources are now limited and currently stretched while labour costs have risen accordingly,” the group said.
“As machines develop in terms of precision technology, scale, and cost, the Irish agricultural contractor sector can no longer be expected to depend on part-time student labour to provide an essential and professional machinery service to Irish farming.”
FCI research from its membership indicates that few established agricultural contractors now want additional work, instead wanting to focus on existing client farmers.
Safety concerns also remain a priority, according to the association.
“Working longer than normal hours with powerful machines to satisfy farmer client demand can result in decision errors due to lack of concentration, caused by fatigue,” according to John Hughes, FCI national chairperson.
“The consequences of the risks of errors with modern machines are too catastrophic to consider. Agricultural contractors and their employees need adequate time and understanding from their client farmers, to carry out their important work in safety.”
He added that these challenges are having an impact on the viability of contractor businesses.
Hughes said that Irish farmers “need to be aware that in this situation the very viability of their own farming operations will be threatened sooner than many think”.
“At FCI we have received calls from members who are coming under pressure from dairy farmers and their advisors to lower the silage harvesting charges in 2023. In a time of high inflation, there is simply no scope for contractors to reduce their charges below those of 2022,” he commented.
It is easy and sometimes convenient to forget that today’s agri-diesel costs remain 25% higher than in 2021. Agri-diesel prices are currently up to 20c/L more expensive than in 2021. That converts to a difference of at least €600 more per day in fuel costs.
Diesel costs, however, are not the major cost, with wages and machinery costs surpassing the fuel costs, according to Hughes.
He advised FCI members not to cut rates just because diesel costs are lower, as all other contractor costs have “risen significantly”.
Machinery purchase prices have increased by between 30% and 50%, while a recent FCI survey of farm machinery suppliers showed that machinery replacement part prices have risen by between 15% and 30% between 2022 and 2023.
Bank interest rates have more than doubled in 12 months from 3% to almost 8%, which the FCI said “adds further to contractor machinery investment costs”.
“Irish agricultural contractors have suffered the pain of machinery cost inflation, along with machinery replacement parts and interest rate increases.
“For many contractors their focus is on getting the work done as efficiently as possible for their client farmers. Farmers and their advisers need to appreciate the value of the services provided by contractors, not just the price,” Hughes said.