Tillage farmers remain concerned about input prices as supply issues, inflation and climate targets are set to continue to affect the sector in 2023, Ifac’s Irish Farm Report 2023 has shown.
While the majority (62%) of tillage farmers have a positive outlook on the sector, input prices are the main concern of 85% of farmers, followed by rules and regulations (44%); and the weather (33%).
The report, which has been published today (Thursday, February 16), shows that prices across all the main cereal crops were very strong in 2022 with yields above the five-year average.
Animal feed costs reached record highs in 2022. Cereal prices from the combine were all costing at least €300/t with a knock-on effect on livestock feed at over €400/t, which is almost double than feed prices two or three years ago.
Cereal prices, however, were significantly eroded due to high fertiliser costs, which coming into 2023 were approximately €850/t for calcium ammonium nitrate (CAN); €960/t for urea; €950/t for 27-2.5-5; and €950/t for 18-6-12.
Tillage outlook
The area sown for winter crops is looking likely to be back as much as 30,000ha on 2022 due to unfavourable planting conditions.
Forward green prices for the 2023 harvest are circa €300/t for barley and wheat, however there is a softening in prices.
“For 2023, the issue isn’t going to be how much you will get paid per tonne, as there is every indication that it will continue to be strong; the main concern for 2023 will be the cost to produce a crop.
“While world reports are suggesting a drop in fertiliser prices, these reductions will, in all probability, be too late for the 2023 crops in Ireland,” the report states.
Organic farming
Over half of beef farmers (52%) and sheep farmers (55%) would consider converting to organic production. However, 30% of the 1,160 surveyed farmers felt that the lack of markets is the biggest barrier.
Skillset has only been cited by 6% of farmers, in contrary to Ifac’s case study in which an organic farmer said the knowledge needed to farm efficiently under organics is the biggest challenge.
A further 17% of surveyed farmers said that the lack of financial support is a barrier to organic farming, however this figure is down by 6% on last year’s results.
The number of dairy farmers who would consider entering organic production dropped by 10% to just 17%, which the report states reflects the strong milk prices conventional dairy farmers were paid in 2022.
The future of organics in Ireland is looking positive and strong, with the new Organic Farming Scheme (OFS) doubling the number of organic farmers at a total of 2,130 applicants, the report states.
“A 150% increase in organic farmers in Ireland the past 12 months is a sign of things to come,” the head of organics at the Department of Agriculture, Food and the Marine (DAFM), Jack Nolan said.
The fruit and vegetable sector has been hit particularly hard by the rapid increase in costs due to energy prices and inflation, with the cost of heating glass houses spiraling out of control. Due to tight margins, land usage decreased by 900ha to 6,600ha in total.