Teagasc has said that the impact on dairy farmer profits from the reduction in the nitrates derogation is “not an easy thing to model”.
At the launch of the Teagasc’s Outlook 2024 Economic Prospects for Agriculture this week, attendees were told that the impact of the reduction on affected farmers will depend on how individual farmers react in order to offset the requirement to move to a lower stocking rate of organic nitrogen (N).
From January 1, the upper limit of organic N stocking rate under the derogation will drop from 250kgN/ha to 220kgN/ha in most of the country.
This means that farmers farming above 220kgN/ha (which number over 2,000) will have to offset their stocking rate in order to ensure that they are at or below 220kg/ha for 2024, and in subsequent years.
A number of questions were put to Teagasc’s representatives at the launch of the report on the impact for 2024 on the financial performance of those farmers who will need to offset there stocking rates; and how that information can be incorporated into Teagasc’s National Farm Survey and related data collection.
Cathal Buckley, a Teagasc research officer, said that the effect on incomes will depend on how farmers react to the derogation cut.
“We’re looking at it. It’s not an easy thing to model. Dairy farmers might choose to act four different ways: access more land through leasing; outsource replacements through contract rearing; get rid of some dairy cows; or you could export slurry,” Buckley said.
“All of those different options have a cost. Farmers will react differently, and we’re trying to [examine] those scenarios and see what the true cost of them will be.”
Kevin Hanrahan, Teagasc’s head of rural economy and development, said: “This is something we’re thinking about deeply and how we incorporate that.”
“Definitely by the end of the year we’d have to have…analysis based on the [National Farm Survey] data,” Hanrahan added.
Buckley pointed out that Teagasc already has data on which farmers are in derogation, and whether or not they export or import slurry.
“We have asked whether farmers are in derogation for at least 10 years now, and we’ve collected the imports and exports of slurry for the last four or five years, so we have a fair handle on what’s happening with organic manure in and outside the farmgate,” Buckley added.