Last week, the Association of Farm and Forestry Contractors in Ireland (FCI) and the IFA attended a meeting in the Department of Finance regarding the impact the recent fuel cost increases are having on the agricultural and forestry contractor sector.
At the meeting the FCI provided both the Minister for Finance, Simon Harris, TD and the Minister for Agriculture, Food, and the Marine, Martin Heydon TD with the significant real world operational impacts currently being felt by the sector since the recent cost increases came into effect. Some of which include:
A standard tractor (eg New Holland T7.210) now incurs an additional €223.88 (excl. VAT) per day in diesel costs. Full silage operations (approx. 100 acres per day) face additional costs of €3,053 per day (excl. VAT). With approximately 2.5m acres of silage cut annually in Ireland, this results in €76.3m in additional diesel costs, ultimately borne across the agricultural contractor sector. In addition to fuel, contractors are experiencing substantial inflation across other essential inputs.
Unlike other sectors, contractors have limited capacity to pass on these increases, as farm clients are simultaneously experiencing cost pressures.
Agricultural contractor
working group
Against that background, the FCI has welcomed the announcement by Minister for Agriculture, Food and the Marine, Martin Heydon, TD, of the date for the first meeting of the Farm Contracting Working Group. The group was established by the Department of Agriculture, Food and the Marine (DAFM) as part of the commitment in the Programme for Government 2025 to consider training, support and taxation measures in the sector.
The new working group will be chaired by the Department and will comprise of representatives from relevant stakeholder organisations.
“This is a significant milestone for the Irish agricultural and forestry contractor sector, and a reward for the time and effort invested in developing FCI to this level since 2012,” said Ann Gleeson Hanrahan, managing director of FCI.
“We are now recognised within Government as an official organisation. FCI will continue work on behalf of agricultural and forestry contractors to facilitate discussion among relevant stakeholders to consider training, support and taxation measures with a view to supporting agricultural and forestry contractors to address the issues that our sector currently faces, whilst also exploiting opportunities that may exist through wider use of agricultural and forestry contractor services to support a sustainable agriculture and forestry sector,” she said.
Minister Heydon said that “setting up a group like this was an objective and ambition of mine in the Programme for Government given the pivotal nature this group plays within the farming sector. These stakeholders are more important than ever now given the current challenges around the Iran conflict. It’s important to address the current issues facing the services to farmers who produce our very valuable agri food exports, which are such a huge part of our economy”.
Other essential inputs affected
Lubricants: +20%. AdBlue, parts, and servicing: +25%. The FCI delegation told the ministers that this scale of cost escalation is not sustainable for agricultural contracting businesses, which already face:
High capital investment cost inflation in machinery. Rising labour and insurance costs. Increased finance repayments and maintenance expenses. Additional regulatory costs (including auto-enrolment and the forthcoming vEMC tyre levy).
Last week, the Association of Farm and Forestry Contractors in Ireland (FCI) and the IFA attended a meeting in the Department of Finance regarding the impact the recent fuel cost increases are having on the agricultural and forestry contractor sector.
At the meeting the FCI provided both the Minister for Finance, Simon Harris, TD and the Minister for Agriculture, Food, and the Marine, Martin Heydon TD with the significant real world operational impacts currently being felt by the sector since the recent cost increases came into effect. Some of which include:
A standard tractor (eg New Holland T7.210) now incurs an additional €223.88 (excl. VAT) per day in diesel costs. Full silage operations (approx. 100 acres per day) face additional costs of €3,053 per day (excl. VAT). With approximately 2.5m acres of silage cut annually in Ireland, this results in €76.3m in additional diesel costs, ultimately borne across the agricultural contractor sector. In addition to fuel, contractors are experiencing substantial inflation across other essential inputs.
Unlike other sectors, contractors have limited capacity to pass on these increases, as farm clients are simultaneously experiencing cost pressures.
Agricultural contractor
working group
Against that background, the FCI has welcomed the announcement by Minister for Agriculture, Food and the Marine, Martin Heydon, TD, of the date for the first meeting of the Farm Contracting Working Group. The group was established by the Department of Agriculture, Food and the Marine (DAFM) as part of the commitment in the Programme for Government 2025 to consider training, support and taxation measures in the sector.
The new working group will be chaired by the Department and will comprise of representatives from relevant stakeholder organisations.
“This is a significant milestone for the Irish agricultural and forestry contractor sector, and a reward for the time and effort invested in developing FCI to this level since 2012,” said Ann Gleeson Hanrahan, managing director of FCI.
“We are now recognised within Government as an official organisation. FCI will continue work on behalf of agricultural and forestry contractors to facilitate discussion among relevant stakeholders to consider training, support and taxation measures with a view to supporting agricultural and forestry contractors to address the issues that our sector currently faces, whilst also exploiting opportunities that may exist through wider use of agricultural and forestry contractor services to support a sustainable agriculture and forestry sector,” she said.
Minister Heydon said that “setting up a group like this was an objective and ambition of mine in the Programme for Government given the pivotal nature this group plays within the farming sector. These stakeholders are more important than ever now given the current challenges around the Iran conflict. It’s important to address the current issues facing the services to farmers who produce our very valuable agri food exports, which are such a huge part of our economy”.
Other essential inputs affected
Lubricants: +20%. AdBlue, parts, and servicing: +25%. The FCI delegation told the ministers that this scale of cost escalation is not sustainable for agricultural contracting businesses, which already face:
High capital investment cost inflation in machinery. Rising labour and insurance costs. Increased finance repayments and maintenance expenses. Additional regulatory costs (including auto-enrolment and the forthcoming vEMC tyre levy). 
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