Weather and growing conditions this year will play a “crucial role” in overall 2024 farm profitability and could also impact the prices paid for land over the year, Teagasc economist, Dr. Jason Loughrey has said.
Teagasc said that the impact of the adverse weather on agricultural output, production costs and farm incomes is a concern and presents an “area of uncertainty” for the current production year.
While milk prices should be higher in 2024, the outlook for cereals remains negative, Dr. Loughrey said. The tillage sector appears to be facing the most difficult short-term outlook. A high degree of uncertainty also remains around cereal markets.
This is according to the Agricultural Land Market Review and Outlook Report 2024 by the Society of Chartered Surveyors Ireland (SCSI) and Teagasc, which shows that tillage production is limited to about 7% of the agricultural land base in Ireland.
“Higher than average heavy rainfall in Q1 2024 has led to very soft ground conditions and water logging, and has delayed the planting of crops and the turnout of animals to pasture.
“While an excess of rainfall has been a problem, farmers will be concerned that improved weather conditions, when they arrive, do not then pivot into drought conditions later in the growing season.
“Therefore, weather and growing conditions this year will play a crucial role in overall farming profitability and could also impact the prices paid for land over the year,” Dr. Loughrey said.
Beef and sheep 2024 outlook
The annual average beef price in 2024 is forecast to be approximately 2-3% higher relative to 2023. Despite some increases in Q1 2024, the total prime beef production in Ireland is forecast to be down for 2024 relative to 2023.
An increase in cow beef production is expected to offset much of the decline in prime beef production. The costs of production for beef are forecast to be slightly lower in 2024, mainly due to lower fertiliser prices.
As a result of the prolonged winter, the positive effect of the decline in feed price is being offset by a rise in feed use and a depletion of fodder reserves. In 2024, it is forecast that margins and incomes on cattle finishing farms will be similar to 2023.
However, there is particular uncertainty for cattle rearing farms due to the timing of cattle sales and the impact of weather conditions, according to the report published today (Tuesday, April 23).
In early 2024, sheep farmers are experiencing strong improvements in the economic situation, particularly as a result of rising lamb prices. While feed prices are declining, a prolonged winter is offsetting the benefit of the reduced feed price.
Due to the stronger lamb and sheep prices, the margins on sheep farms are forecast to increase in 2024. In March 2024, average heavy lamb prices are approximately 16% higher relative to March 2023.
EU imports of lamb and goat meat increased by 4% in 2023 relative to 2022. This increase is mainly due to imports from the UK. It is expected that there will be further increases in imports in 2024 given the level of EU prices, the report states.