Reflections on a challenging year for farmers
Despite the excellent weather and growing conditions most farmers will be asking themselves the question: where did it all go wrong in 2014? As this year ends, most producers will be reviewing their accounts and, no doubt, concluding that the incomes they have generated are not as positive as they might have initially thought.
The reality is that profitable farming is now all about getting the best possible farmgate returns. Take the tillage sector, as a case in point. Farmers will confirm that this year’s harvest was one of the best on record: yields were excellent, as was grain quality.
Throw in the fact that straw quality is also tremendous this winter and one would think these same farmers would be walking around with broad grins on their faces. But they are not. And this is solely due to the fact that cereal prices have fallen by such a high percentage year-on-year.
Milk had a great start to the year but, even here, the downturn in international milk markets over recent months has served to take shine of what might have been a record breaking 12 months.
Beef, on the other hand, had a very bad start to 2014 with a combination of faltering prices and carcass specification changes sapping the energy and enthusiasm of even the most committed producer. Thankfully, markets have strengthened over recent weeks with the result that the outlook for beef doesn’t look too bad at all.
The year just ending saw grass growth rates break all records. But even in the midst of all this good news, nature still managed to remind us that she can have a mind of her own. For some reason – and no one yet knows why – the quality of the first cut silages made on many farms this year is not up to the expected standard. This, in turn, will put pressure on the levels of animal performance achieved from forage this winter.
And, of course, underpinning all of this is the fact that the input costs incurred by farmers will continue to rise. Yes oil and meal prices have come back a tad over recent weeks. But, no doubt, this is only a blip and the inexorable rise in input costs will come back on track once we get into 2015.
Don’t get me wrong: farmers must continually strive to improve the efficiency of their businesses. But if this process is not underpinned by realistic farmgate returns then the outlook for agriculture as a whole can be best described as challenging.