Farm Ireland

Wednesday 22 November 2017

IFA targets €250m drop in input costs

Majella O'Sullivan

Majella O'Sullivan

THE IFA is plotting a €250m reduction in input costs to realign Irish production costs with those of its competitors.

Inputs project team leader Chris Hayes said incomes were being eroded by the higher cost of inputs and services on which farmers spend in excess of €4bn each year.

"The biggest expenditure items are fertiliser, feed and fuel/energy," Mr Hayes said.

"Excluding farm-to-farm sales of fodder, feed and contractor charges, the annual spend is close to €3bn.

"Controlling and reducing costs is critical to the success and profitability of farming."

He said that on the compound feed side alone, supply chain length and inefficiencies were costing farmers around €36m a year for every €10 extra spent on a tonne of feed.

The farm organisation says that another €30m saving can be made on fertiliser costs. Half of this amount could be achieved by direct selling from factory to farm, while the rest of the savings could be made by increasing the amount of direct deliveries to 80-85pc, reducing the number of depots and co-ordinating transport.

Mr Hayes also cited over-priced professional and service fees, and regulatory costs and market segmentation on a country-by-country basis for plant protection products and veterinary medicines, as adding to Irish farmers' costs.

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"Restoring the balance of power through the establishment of more buying groups and targeted surveys is a key part of IFA's strategy to put downward pressure on costs," Mr Hayes said.

He said meetings were ongoing with service providers, manufacturers and distributors.

Irish Independent