Farm Ireland
Independent.ie

Tuesday 16 January 2018

Grain price fall will lead tillage farmers to slash cereal acreage

Caitriona Murphy

Caitriona Murphy

Tillage farmers are expected to cut their 2014 cereal acreage by as much as 15,000ha or 37,000ac as a result of a €50-60/t fall in 2013 grain prices.

Cereal growers are set to lose €15/t on their crops at current prices of €150/t and are expected to cut back their sowings by at least 5pc for next year.

Glanbia revealed its final grain price for green grain on Friday, announcing a feed barley price of €145/t plus VAT at 4.8pc or €151.96/t.

CONTRACT

Malting barley varieties Saffron and Cassia bought on contract will be paid at €160/t plus VAT or €167.68/t, while feed wheat is to be paid at €155/t plus VAT or €162.44/t.

Oats for the equine market bought on contract will be paid at €155/t plus VAT or €162.44/t.

With world grain markets depressed, the low final grain price is not a surprise to growers, but is disappointing nonetheless.

IFA grain chairman Noel Delany maintained the 2013 harvest price had growers questioning the viability of Irish grain production.

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While winter barley sowings are expected to increase by 10-15pc over the 35,000ha sown in 2013, growers are set to slash their acreage of wheat after poor yields affected its profitability this year.

Some 44,000ha of winter wheat was harvested in 2013 but this could fall by 20pc in 2014 as growers steer away from continuous wheat crops.

Mr Delany said rising input costs such as fuel and fertiliser were squeezing the returns in grain production too much.

"Fertiliser prices alone increased by a massive 260pc between 2003 and 2013, while fuel prices have gone up by over 200pc," he pointed out.

ECONOMICS

"Variable production costs, including machinery hire, for spring barley have gone from €640/ha (excluding VAT) in 2003 to approximately €1,000/ha today, while grain prices are falling.

"Production costs for other arable crops have followed a similar pattern," he added.

Higher input costs, combined with changing weather patterns and a looming income cut from CAP reform, have tillage growers thinking long and hard about the economics of their businesses, Mr Delany maintained.

Irish Independent



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