The continuous spell of wet weather has brought the harvest to an abrupt halt right across the country. It is a stressful period for tillage farmers as they are forced to leave combines idle alongside ripe crops that they have invested over €600/acre to produce.
It is easy to understand the temptation to get going, even where weather conditions are far from satisfactory and moisture content is high. However, the advice at this stage is for farmers to hold their nerve but to move when possible.
Some crops are blackening and there is some evidence of sprouting, but hopefully quality will hold up. In some cases, ripe spring barley crops are at higher risk, especially malting barley, which must pass a range of different specifications to secure its price premium. While over half of this crop is already harvested, it is still hugely significant for growers with standing crops.
The wet weather is now also interfering with plans for next year. Ideally the focus should be shifting towards planting winter oilseed rape. With prices of €380/tonne still on offer for next harvest and yields of 1.8-2.4 t/ac being achieved this year, this crop clearly has an important role in the rotation. It can bring better financial returns plus its knock-on value as a break crop.
Unfortunately, a combination of un-harvested crops, delays in clearing straw and unsuitable ground conditions is delaying planting.
Another crop showing value in the rotation is beans. The success of the coupled aid scheme for protein crops should demonstrate to the European Commission that meaningful coupled payments are an important tool to help drive farmer behaviour.
It is encouraging to see how the feed industry has reacted to the increased availability of this Irish protein source and its inclusion into rations. There is no doubt that with some retailers continuing to focus on sourcing beef fed on GM-free rations, the role of native beans as a good quality protein and energy source will come more centre stage.
The GM-free issue is also creeping into the dairy sector. The current barrier that exists to higher inclusion rates is the concentration of some tannins in beans, which limit feed intake. Current research efforts are looking towards this area and we hope that Teagasc can help unearth low-tannin varieties over time.
Meanwhile, along with contending with poor weather conditions, tillage farmers are also seeing prices trending in the wrong direction. There is no doubt that exchange rates are having an impact but the fundamental challenge is the low price of feed maize. Based on current prices, imported maize could be included in cattle diets for little over €200/t and is, in effect, capping feed barley prices. There is much less justification for malting barley prices that have dropped to €150-€152/t.
There is clearly something wrong in a market where farmers who produce a high-quality food grade product are forced to meet husbandry and specification requirements are still subject to the low end of commodity price trends. This is especially the case where the raw material price has little or no bearing on the end product price.
There is of course a need for the tillage sector to better develop forward pricing mechanisms. In this regard, it is important to acknowledge that a forward price of €178/t was offered at the peak of the market for malting barley in advance of the harvest. However, at farm level, it is understandable that a sector that has suffered continuous losses in recent years is reluctant to lock into forward pricing for fear of missing out on a future price spike.
Unfortunately, after five consecutive years of waiting for this illusive price spike, many tillage farmers are questioning their future in the sector. Despite the collapse in profitability, these farms have seen little indication that the Government recognises the importance of the sector in supporting our agri-food exports. At a minimum, we need a five-year plan for our tillage sector with measurable targets and stakeholder actions. The decision to do nothing is a decision to sacrifice native production and become increasingly reliant on imports.
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