‘I’m probably dealing with one new dairy entrant per week’

The Irish dairy industry is going through an evolution. The abolition of milk quotas in April 2015 has paved the way for expansion. However, it has also raised some challenges along the way.

These have been more evident than ever this year. A disastrous start to weather in 2018 and an unforeseen drought this summer, has played havoc on dairy farms – and indeed all farms – across Ireland.

With expansion comes construction. New cubicle sheds, extensions and milking parlours have popped up in farmyards throughout the country.

Speaking to AgriLand, Aidan Kelly – an agricultural buildings advisor – from Agri Design and Planning Services (ADPS) outlined that the amount of people either going into dairying or converting to dairying is on the rise.

However, he noted that the phone has cooled off in recent weeks due to the weather and that some farms are under severe pressure – especially in the last two or three weeks.

“Farmers are not as quick as usual to come back with drawings that I have issued over the last three weeks. These farms are under pressure and I know they have more important matters on hand at the minute,” he explained.

Spiraling costs

Aidan noted that people seem to be looking only at the business plan and extra money they can make. He also highlighted that they may not understand the extra time involved with running a dairy operation and the costs associated with this.

The Tipperary native highlighted that the majority of his clients would be operating under TAMS (Targeted Agricultural Modernisation Scheme).

“If your getting into 100 cows, the set-up costs are normally between €200,000 and €500,000 over a five-year period. €200,000 would get you into dairying if you have buildings to convert and there is some level of infrastructure in place.

“However, the biggest issue I see when I meet clients is that they don’t have an understanding of the true cost; people think they will put up a milking parlour for €100,000.

“In essence, when we sit down and they realise what needs to be done, they’re spending up on €400,000. They are normally 20-30% off where they need to be; they underestimate the total cost of things,” he explained.

Aidan outlined that the cost per cubicle has risen in recent months from €1,500-1,600 to €2,000 per cubicle space and attributed these increases to a number of factors.

“The first main reason is that builders are busier; any builder that I’m talking to has enough work in front of them for 12 to 14 months.

“The second main factor is the cost of concrete and steel; these have increased by 4-5% and this is being passed directly onto the farmer straight away,” he added.

While the majority of Aidan’s workload would be dairy based, he noted that existing beef farmers make use of the grant and upgrade their facilities to make life easier on themselves.