Increasing input costs, especially for fertiliser, are wiping out price gains for farmers and eroding the value of direct payments, according to the Irish Farmers’ Association (IFA).
The association was reacting to the publication of the results of the Teagsc National Farm Survey 2021, which were revealed by the farm advisory and training authority this morning (Tuesday, June 14).
Speaking this afternoon, Tim Cullinan, the president of the IFA, said that the survey – which shows an increase in the average farm income of 26% for 2021 compared to 2022 – has been “overtaken by dramatic changes in the last six months”.
He said that the input price increases across a number areas, most notably for fertiliser, is creating uncertainty for farmers.
“Inputs are at a frightening rate and whether it’s fuel, fertiliser or feed, they have wiped out any gain from the commodity prices, while the value of direct payments are being seriously eroded by inflation,” Cullinan said.
He added: “The gap between output prices and input costs illustrate how the extraordinary increase in inputs is running far ahead of any commodity price increases, particularly for farmers in the drystock sector.
“We have repeatedly said the government and the European Commission has to step in and support farmers if they want to guarantee food security.”
Cullinan cited comments from European Commissioner for Agriculture and Rural Development Janusz Wojciechowski, who spoke at a meeting of the IFA’s National Council recently.
“[The commissioner] acknowledged during his meeting with the IFA National Council last month that policy has to reprioritise in response to the scale of this issue,” the IFA president said.
He argued that “no time can be lost” in bringing forward measures to assist farmers.
“These should include targeted supports; maximum co-financing, and no further increases in the cost of production in Budget 2023.”
According to Cullinan, farmers will be “taking a very hard look” at investment decisions based on the trend in input costs.
“It’s likely the full effect of what’s happening at the moment will not be felt immediately, but it will severely impact on the long-term productive capacity of the sector into the future,” he concluded.