An anticipated surge in fertiliser costs in 2022 will “wipe out any gains made this year through better output prices” according to Irish Creamery Milk Suppliers’ Association (ICMSA) president, Pat McCormack.
While output prices for most farm commodities increased during 2021, the benefits of these “long-overdue price increases are being completely wiped out due to an across-the-board surge in farm input costs” the president said.
But the most concerning rise in price, by far, relates to fertiliser, he said, which seems to be “increasing by multiples”.
He has called for immediate action at EU Commission level to reduce the cost of fertiliser.
“It’s very clear now that the cost of fertiliser in 2022 is going to not alone wipe out any gains made through better output prices received by family farms this year, but will actually burn all the way through those gains and out the ‘other side’ into net losses,” said McCormack.
“Fertiliser is the most alarming, but we’re also looking at costs surges in feed, energy and diesel as well, and all due to factors completely outside the control of farmers.”
He added that the issues and uncertainty around gas prices are impacting all sectors of society, but have a particular inflationary effect on fertiliser production costs.
“That has to be recognised and rectified very quickly,” he said.
“In addition, the EU must remove all trade barriers that are adding additional costs to fertiliser customers and support measures must be put in place to recognise the increased costs on the primary producer.
“There’s really no point in highlighting the high output prices and citing the Central Statistics Office (CSO) reports if we’re going to ignore the fact that the costs of producing the food is now overtaking the prices farmers are receiving.
“It’s no good getting a milk price of 37c/L up from 32c/L if the costs of producing that litre have gone by a greater margin.
“Either output prices increase further to reflect increased production costs or input costs have got to be halted and reversed or else the whole economics of farming fall.
“Immediate action is required at EU level on this matter,” said the ICMSA president.