The average farm income in 2024 is estimated to be up 49% to almost €29,200, according to Teagasc.

The increase is driven mainly by the increase in income experienced in the dairy and tillage sectors this year, Teagasc said following the publication of its Outlook Report for 2025.

The report, by economists at Teagasc, provides the latest estimates of average incomes for various farm types in 2024 and looks ahead to future prospects by forecasting farm incomes in 2025.

The average farm income in 2025 is forecast to increase by 22% to €35,70.

Irish agriculture, Teagasc said, faced a complex set of challenges in 2024, shaped mainly by periods of unfavourable weather.

Dairy

For dairy farms, a delayed start to the grazing season was followed by poor mid-season grass growth, leaving milk production about 5% below normal by mid-year.

However, with excellent late-season grazing conditions, along with increased feed use, milk production is expected to be down about 2% for the year as a whole.

While it was a poor year for grass growth overall, dairy farms have seen a substantial income recovery in 2024, as higher milk prices - up 15% on the 2023 level - have driven a recovery in margins.

The average dairy farm income in 2024 should be approximately €89,000

The typical dairy margin should be over 13c/l in 2024, an increase of over 6c/l on the 2023 average.

Taking account of the drop in milk production, the average dairy farm income in 2024 should be approximately €89,000, an increase of 80% relative to the very low level recorded in 2023.

Sucklers

For cattle-rearing farms, incomes should show a modest increase in 2024. Averaging over the year, beef cattle prices were up slightly.

There were also minor cost reductions, even though feed usage was higher due to poor grass production.

Despite declining average cattle weights, higher cattle prices are expected to support an improvement in margins, though the sector’s income remains largely reliant on support payments.

The average income on a cattle-rearing farm in 2024 is estimated to be approximately €9,500, an increase of 28% on the extremely low 2023 level.

Finishers

For the cattle other farm category (mainly finishers), finished cattle prices have shown seasonal fluctuation, but the annual average price in 2024 should be up 4% on the 2023 level.

With the reduction in production costs, the average income for cattle other farms in 2024 is forecast to increase to approximately €17,000, an increase of 15% on the very low income figure reported in 2023.

Sheep

While sheep and lamb prices rose significantly in 2024 - up by about 15% on the 2023 level due to tighter EU supplies - output volume per hectare is estimated to have declined by 10% in 2024 due to lower ewe numbers and weaning rates.

However, with lower production costs and increased coupled direct payments, margins and income for sheep farms are estimated to have increased in 2024.

The average income on a sheep farm is estimated to be approximately €15,000, an increase of 19% on the relatively low income level of 2023.

Tillage

Tillage farms endured another challenging production year in 2024, but the end outcome was not quite as bad as had been feared earlier in the year.

The average income on a tillage farm in 2024 is approximately €30,000

The estimated increase in incomes in 2024 is appreciable, but it still leaves the average tillage income well down on the five-year average.

Delays in planting last autumn and winter led to a shift from winter to spring crops, resulting in an overall level of production which was below normal.

Yields for spring crops were below the five-year average, but generally better than expected in 2024, while yields for winter crops were generally down.

Harvest prices for major cereals in 2024 were up only slightly on those at harvest 2023.

With substantial reductions in fertiliser prices, cost savings were sufficient to allow a partial recovery in farm incomes in 2024, following on from the extremely low incomes recorded in 2023.

Nevertheless, tillage farms remain heavily reliant on support payments to maintain profitability.

The average income on a tillage farm in 2024 is estimated to be approximately €30,000, an increase of 40% relative to 2023.

Pigs

Pig production was more profitable in 2024 and pig production increased by 3% in volume terms.

Pig prices fell 2% relative to the 2023 level and a significant drop in feed prices in 2024 resulted in lower production costs.

This has resulted in an increase in margins on pig farms, with an estimated margin over feed of 86 cent per kilogramme for 2024.

Forestry

In 2024, forestry planting levels are estimated to be under 2,000 hectares (ha).

Timber prices in the forestry sector were generally at similar levels to those of 2023, reflecting challenging supply and demand conditions.

In terms of forestry returns, using 10-year average forestry timber prices, it is estimated that the annualised equivalent values (AEV) for forest types seven and 12 were €578/ha and €740/ha respectively.

Outlook for 2025

Looking ahead to 2025, economic growth at global level is expected to be on a par with 2024, although there are several geopolitical uncertainties which could have an adverse impact.

The reduction in key input prices experienced in 2024 should persist into 2025, meaning that input costs for 2025 as a whole should be in line with or slightly lower than in 2024.

With these caveats in mind, energy and feed prices in 2025 are currently forecast to be in line with the 2024 level, while fertiliser prices are expected to be slightly lower than in 2024.

There is scope for some cost savings in feed use in grassland systems if weather conditions in 2025 are closer to normal. There is likely to be some further increase in prices of other input items.

General inflation is expected to remain at close to the target level. So overall, production costs in 2025 should be close to the 2024 level.

Dairy

Dairy commodity prices will enter 2025 at an elevated level and the short-term outlook remains quite positive.

Taking the year as a whole, there is scope for a further improvement in Irish milk prices in 2025, given that the price for butter, in particular, is at an extremely high level.

Milk prices should hold at a high level, at least in the short term, with some reduction occurring as the year progresses. Averaging over the year, milk prices in 2025 could be up 5% on the 2024 level.

Assuming weather conditions are more favourable in 2025 than they have been in 2024, there is scope for a yield-based increase in milk production of 4% and some savings from lower feed volumes. Margins in 2025 would therefore improve relative to 2024.

The forecast average dairy farm income in 2025 of €113,000 would represent a 27% increase on the estimated average income level for 2024.

Cattle prices

The forecast is for a 4% increase in finished cattle prices and a 2% increase in weanling prices in 2025 relative to 2024, while production costs are also expected to ease slightly.

Average incomes are forecast to rise on cattle farms in 2025, with an increase of 14% in prospect for cattle-rearing farms to €10,800 and an increase of 9% for cattle other farms to €18,500.

Sheep

For sheep farms, lamb prices in 2025 are forecast to remain close to the 2024 level.

With a forecast of marginally lower production costs and with continued support under the new Sheep Welfare Scheme, the average income on sheep farms in 2025 is forecast to rise to €17,250, an increase of 15% on the 2024 level.

Tillage

On tillage farms, cereal prices are forecast to be marginally higher at harvest 2025.

Under the assumption that trend yields are achieved, yields in 2025 would be up on the 2024 level. Factoring in stable production costs in 2025, the average tillage income is forecast to increase by 40% to €42,000.

Pigs

The volume of pig production is forecast to increase by a further 1% in 2025.

While Irish pig prices are forecast to decrease by 8%, little change in production costs is forecast. The margin over feed cost is forecast to decrease to 72c/kg.

Forestry

Government funding for forestry measures in 2025 has been set at €91m, which would be sufficient to support the establishment of 8,000ha of new forest area.

New planting is forecast to increase in 2025, with over 7,300ha currently approved for planting. The net realisable volume of private sector forestry in Ireland is forecast to increase by 2.5% to 2.47 million m3 in 2025.

Demand for timber from the construction industry is expected to increase in 2025 due to a forecast of increased construction activity.