We can’t hide the fact that prices are reaching record levels for many of the key outputs.

Milk price is up almost 6c/litre on the same time last year. Yes, October milk supplies are small in the south but are much more significant in Northern Ireland.

Beef price increased again this week. Sheep price actually took a slight dip, but again €7/kg in November is unheard of. However, all of this must be couched with the very real warning on both the supply and cost of fertiliser.

In this week's edition, Grassland Agro managing director Liam Woulfe explains in simple language that there is a problem looming – the implications of which could be far-reaching.

The much-talked-about boat of fertiliser which landed this week is a drop in the ocean. There should be a boat like this coming into Ireland every few days to meet early season demand for fertiliser.

Forward prices for milk and grain need to be considered as something of an insurance policy for those who may be exposed due to having a new or undeveloped farm or because they are overburdened with debt

So, what next? We now know there is a problem on price and availability. The full and worst implications of this might not come home to roost until next winter.

We saw before that the Department of Agriculture and Teagasc are better to be ahead of the game on any impending crisis. In the wake of the recent droughts, specific review teams were set up after the event. Why not go now and set up an expert panel to look at what fertiliser stocks we have in the country and what farmers need to do this winter?

What can farmers do?

This week, our team of specialists looks at some of the actions farmers can take now to make changes. Of course, these actions will vary from farm to farm.

Silage and hay stocks are the most obvious indirect source of nitrogen on many farms. Stock numbers on farms need to be analysed as any passengers or stock that are not delivering to the bottom line of the business need to be questioned.

We need a laser-like focus on optimising inputs. Fertiliser is feed for animals in just another name.

Forward prices for milk and grain need to be considered as something of an insurance policy for those who may be exposed due to having a new or undeveloped farm or because they are overburdened with debt.

All the talk in climate change circles and management of agri greenhouse gases is around protected urea and better use of slurry.

The protected urea debate will be helped by the fact that nitrogen looks like it’s going to be very scarce next year.

Better use of slurry should be a priority on all farms and the value now of a tanker of slurry has also doubled if not trebled in price as a result of the nitrogen price lifts. Of course, LESS or using trailing shoes is one of the best ways to get more nitrogen from slurry.

New technologies

The ask of policymakers and the Department is that they make any new technologies available to farmers so they can be competitive. Fertiliser is just one input that has seen a cost rise. We could list many more.

The same must be said of processors, which ultimately farmers pay for as well. Gas is a big input cost. The price of gas has quadrupled – a big part of the milk drying process.

Lakeland Dairies CEO Michael Hanley suggests that this could equate to 3 or 4c/litre if gas prices stayed at very high levels for a year. Luckily, peak milk had passed before the real rise in gas prices happened in 2021.

So, while farmers are rightfully getting decent output prices, the reality now is profits will be well down in 2022 and the worst-case scenario is that next winter could be very difficult.

It’s time to act now and anticipate rather than wait and start counting or giving out when the horse has bolted.