Estimated 15% increase in cattle values for 2020 - CSO

The Central Statistics Office’s (CSO) first estimate of agricultural operating surplus for 2020 is an expected annual increase of €428.9 million (+14.0%) to €3,484.1 million with cattle values set to rise.

This increase is mostly due to livestock, which is projected to contribute an additional €388.3 million to the value of agricultural output in 2020.

With the volume of cattle production forecasted to rise by 9.9%, the net impact when combined with improved prices is a projected rise of €327.6 million (+15.2%) in cattle values.

The operating surplus is comprised of the operating surplus earned by farmers and that earned by agricultural 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.

Sheep and pigs

Pig and sheep values are also expected to grow. The volume of pig production is estimated to rise by 5.8%, and with price increases, the value of pig production is projected to grow from €543 million to €602.3 million – an increase of €59.3 million (+10.9%).

While the volume of sheep production is expected to fall marginally (-0.7%), improved prices should lead to sheep values rising by €28 million (+10.7%) to €288.8 million.

Poultry and horses

Despite reduced prices, a projected volume growth of 6.8% results in the overall value of poultry would see it increasing by 3.6% to €176.6 million.

Horses is the only category of livestock expected to experience shrinking values in 2020, with both reduced volumes (-8.8%) and prices resulting in horse values falling by €32.6 million (-12.8%) to €222.9 million.

Milk and cereal production

The value of milk production for 2020 is projected to rise by €98.1 million (+3.8%) to €2.69 billion, mainly due to a 3.1% increase in milk volumes.

Primarily as a result of reduced yields, the volume of cereal production is expected to fall by 27.2% in 2020.

With only relatively minor increases in average prices to counteract that decline, the value of cereals is projected to fall by €80.7 million (-25.6%) to €234 million.

Despite this, the value of agricultural output at basic prices is expected to rise by €421.1 million (+4.9%) to €8.9 billion.

Input costs

With relatively limited data currently available on input costs, only minor changes to intermediate consumption costs are projected for 2020.

While the volume of feeding stuffs consumed by Irish farmers is expected to increase by 5.6%, reduced prices will result in their cost growing by €58.1 million (+3.9%) to €1.5 billion.

With little change in consumption volumes and reduced average prices, the overall cost of fertilisers is forecast to fall by €56.2 million (-9.7%) to €522.1 million.

With the increased value of agricultural outputs; little projected change to input costs; a 2% reduction in the standard Value Added Tax (VAT) rate introduced in September 2020; and no change to the flat rate farmers’ VAT compensation scheme; the projected value of other subsidies, less taxes on production, is an increase of €46.9 million (+2.7%) to €1.8 billion.

The value of net subsidies, i.e. subsidies less taxes on products plus subsidies less taxes on production, is expected to increase from €1.8 billion to almost €1.9 billion, an increase of 2.3%.

Subsidies and taxes on agricultural products are those paid or levied per unit of a good or service produced or exported. An example of subsidies on product is the beef data and genomics premium. The bovine disease eradication levy is an example of a tax on products.

The figures for 2020 are advance estimates which are provisional and based on the latest available data within the CSO.

These figures are subject to change once the complete set of data for the full year becomes available.