Ireland could “sleepwalk” into a scenario where land prices could further spiral if the government does not secure an extension to the nitrates derogation past 2025, an MEP has warned.
Fianna Fáil MEP Billy Kelleher said there is already heightened competition between dairy farmers and other farmers over land which he believes could be exacerbated by any change to the current position on nitrates.
The MEP said that the reality is that dairy farmers are currently winning out more often than not when it comes to competition for land.
Kelleher added: “If the derogation is lost, we can expect a lot of dairy farmers to start actively searching for additional land to rent or buy. This will squeeze tillage, suckler and sheep farmers even more, and severely reduce their ability to make a living.
“The first and only objective for the government is to ensure that the nitrates directive derogation is extended. Its loss would be detrimental to the cohesion of Irish agriculture and a major crisis for farm families up and down the country.”
According to Tom Crosse, group property director of GVM Auctioneers and rural affairs chairman of the Institute of Professional Auctioneers and Valuers (IPAV), there is no doubt that there is strong demand for land at this time.
“Nitrates levels and stocking levels are pushing this and one trend that we’re seeing is the gap widening between moderate to poor land and the price people are prepared to pay for good land.
“The whole land-letting market has gone through the roof – if farmers want to keep developing then they need to get more land to rent or to buy.
“We’re probably seeing a bit of a trend towards letting land being an option rather than the traditional purchase option.
“We’re seeing people developing their establishments and facilities maybe in favour of buying land and they’re opting to rent land instead. We’re seeing dairy partnerships forming now as another option and they’re also leasing land as part of that,” Crosse said.
Ireland secured an extension of its nitrates derogation for the period 2022 to 2025 from the European Commission based on “a strengthened set of water protection measures, an increased level of inspections and a requirement for an interim review of water quality in 2023”.
Under current nitrates legislation the legal stocking rate is 170kg organic nitrogen/ha and the derogation allows some farmers to exceed this, to a maximum limit of 250kg.
But if the review of water quality does not pass the test then the maximum limit could fall from 250kg of organic nitrogen to 220kg.
Kelleher believes the water quality review will “either make or break the situation” regarding the nitrates derogation.
“I cannot emphasise enough how important this review will be for Irish agriculture,” the Fianna Fáil MEP stressed.
Minister for Agriculture, Food and the Marine, Charlie McConalogue, recently told the Seanad that he is preparing a case for the European Commission to seek further flexibility to show improvements in water quality.
The minister said that if Ireland continues to have a nitrates derogation post-2025 it might be the only member state to have a derogation at that stage which he said could become “an increasingly challenging situation”.