Farm Ireland

Tuesday 23 January 2018

Farm costs have increased by 72pc

Martin Ryan

Farm input costs increased by 72pc in the last decade, while product prices increased by 25pc and farm incomes fell 1pc when all subsidies were included.

In addition, the IFA's economist, Rowena Dwyer, claimed that the pace of increase in some farm inputs has further accelerated in recent years.

The picture was much different in the previous decade between 1995 and 2005, when input prices increased at a slower pace.

The contrast between farm output and input prices is most apparent when looked at from 1995-2014. Milk price in 1995 was about 30c/l, while last year it hit 37c/l - an increase of 22pc.

Beef was around €2.90/kg in 1995 and €3.70/kg in 2014. Grain growers received about €120/t in 1995. In 2014, the grain price was about €130/t, representing an increase of 7pc.

In contrast, a tonne of CAN in 1995 was €160. By 2014 the cost of CAN had increased to €320/t, or double its 1995 level. Urea also doubled from around €200/t to €395/t in the two decades.

The rate of the price increase doubled in the second decade, from 29pc up to 2005 to 66pc in the last decade.

Farmers have offset some of the higher prices by reducing their usage from a peak of 1.8m tonnes annually in the late 1990s to 1.3m tonnes a year since 2009. However, overall spend on fertiliser still increased from €350m ten years ago to over €600m last year.

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