Farm profits slip despite price lift
Farm profitability is lower now than 10 years ago, despite recent price surges, according to Professor Alan Matthews of Trinity College.
He told delegates at an agri-business conference in Dublin last week that output prices had failed to keep ahead of the rapid increase in input costs over the last 10 years.
The professor of European agricultural policy said that input costs had increased by 68pc in the decade since 2000, while output prices had only increased by 41pc during the same period.
"We allowed ourselves to become high-cost producers during the nineties, when the level of inputs used on Irish farms significantly increased," he said, before adding that this shift to a higher cost base remained unchanged ever since.
The professor singled out meal and fertiliser costs as the main culprits, despite the rapid rise in labour costs during the same period.
He stated that there was a real need to address the declining terms of trade if the farm sector was to have any hope of competing on the global stage.
However, he remained optimistic that the agricultural sector would eventually meet the targets set out in the Food Harvest 2020 report, albeit not within the timeframe set out in the report.