Teagasc has finalised its specimen Share Farming Agreement for the dairy sector, which is designed to allow two parties set up a dairy farm agreement without forming a farm partnership or company.
The agreement was developed by Tom Curran, Teagasc Farm Structures Specialist, in consultation with a steering committee representing a wide range of stakeholders and with the support of the Irish Farm Managers Association.
The purpose of the template is to help landowners and potential share farmers to form a sound legal agreement when setting up a dairy share farming operation, Teagasc says.
Here are some of the terms of the Agreement between a Landowner and a Share Farmer:
- A contract.
- Two independent businesses operating on one farm.
- Milk cheque divided by the processor.
- Costs divided based on agreement between the parties.
- System that rewards efficiency.
There are several advantages to both the Landowner and the Share Farmer under a dairy Share Farming Agreement:
Advantages to the Landowner:
- Option to step back from day-to-day work.
- Continued operation of the farming business.
- Contract with a young, trained, motivated individual.
- Incentivised management of the dairy farm for both parties.
Advantages to Share Farmer:
- Ladder of entry – Access to dairy farming.
- Ability to grow own income, build a business.
- Provides opportunity to reward ability and efficiency.
- Own boss.
- Priority is to build equity.
- More tax efficient.
The Share Farming Agreement is a way of bringing young people into agriculture and dairy farming and it also brings an opportunity for people who want to get out of farming, the Minister of State at the Department of Agriculture, Food and the Marine, Tom Hayes said at its launch.
He said the Farm Managers Association, who launched the Agreement with Teagasc have had a huge impact on agriculture in changing times.