Teagasc looks set to do a U-turn on its stocking rate advice to suckler farmers.

New analysis has found that margins on lower-stocked beef farms are forecast to be similar to higher-stocked farms this year.

The modelling exercise, seen by the Irish Farmers Journal, shows an alarming shift in margins on highly stocked beef farms in 2022.

It found that farms stocked at 1.6 LU/ha could see a 28% increase in net margin from €274/ha in 2020 to €351/ha in 2022 when input and output prices are compared.

Farms stocked at 2.6 LU/ha, on the other hand, could see margins move in the opposite direction, with a 17% drop from €440/ha to €367/ha.

Much of this drop is due to higher fertiliser prices and higher volumes being spread.

The analysis shows that beef price increases have fully offset the higher costs of production on more extensive farms but aren’t enough on highly stocked farms.

Production costs have increased by between 15% and 28% over the last 12 months.

With future policy changes and support payments pointing to further extensification of beef production, there is now a real fear for the future of the full-time conventional suckler farm in Ireland.

Beef enterprise leader in Teagasc Grange and author of the new analysis, Paul Crosson, said: “We can no longer justify driving our systems on imported nitrogen and need to base forage production on clover and that’s only considering the economic argument.

“I expect that a good clover-based sward will carry about 2.2 LU/ha with low nitrogen.”

Looking further ahead and even with more normalised input prices, Teagasc’s 2027 roadmap for the sector also points to the fact that with the change in CAP payments, suckler farmers would be more profitable reducing stocking rates further and accessing the organic scheme rather than focusing on driving farm output.