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Teagasc’s National Farm Survey for 2016 shows that average farm income was €24,060, down 9% on 2015.
This is the lowest figure in six years.
The milk price crash affecting peak production months last year meant dairy farmers suffered the heaviest loss, with incomes down 17%. More than €10,000 was wiped off the income of the average Irish dairy farm last year.
“Increases in milk volume and production efficiency further reduced production costs in 2016, but lower milk price meant dairy farmers were unable to maintain their incomes,” said Teagasc economist Trevor Donnellan.
Tillage farmers saw profits decline by 10% to €30,816 on average, which Teagasc attributes to the combination of decreases in yields and prices.
Drystock steady
Despite low cattle prices in 2016, Teagasc says the rollout of GLAS and the BDGP led to a modest net income increase of 2% to 4% for suckler and beef farmers. This left the average cattle farm income at €12,908. “Cattle farmers are still very reliant on direct payments, which comprise a large proportion of their income,” said Brian Moran of Teagasc.
Sheep farming returned a stable income, averaging €16,011 last year, as increased payments compensated for lower lamb prices.
The average direct payment per farm was nearly €18,000 in 2016. This contributes to 75% of farm income on average and almost 100% for drystock farmers.
Investment
On-farm investment fell by nearly €100m to €690m last year. The largest capital investors were dairy farmers, with a €245m spend – this was a massive slowdown compared with the €300m they invested the previous year.
Teagasc’s outlook for this year as far as dairying is concerned is “very positive, with a dramatic recovery in incomes forecast”.
Income from drystock farming is expected to remain stable.The survey found that the average age of Irish farmers is 56.
Contractors owed €12m as farm debt mounts
Listen: Lower milk and grain prices dragged down 2016 incomes
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