Tillage returns improve but Teagasc urges caution after 'freak' year
The average returns from winter wheat and spring barley increased 50pc in 2018 compared to 2017, preliminary results from the Teagasc eProfit Monitor indicate.
While winter wheat and spring barley yields decreased by an average of 22pc last harvest, a combination of higher grain and straw prices, and lower costs, meant that returns to growers improved significantly.
However, Michael Hennessy of Teagasc cautioned that the preliminary results were based on returns from just around 45 growers and did not give a comprehensive picture.
"We must be careful when looking at the 2018 figures as the results will be very different depending on where a farmer was located," Mr Hennessy said.
"We know farms with a mix of winter and spring crops in the north-east returned reasonable yields and fared far better than farmers dependent on spring crops in the south-east," he explained.
"Farmers will continue to collate their figures in the coming months and we will have a clearer picture of the situation towards the middle of 2019," Mr Hennessy added.
Average yields for grain crops were well back in 2018 compared to 2017 as a result of the summer drought.
Winter wheat yields fell from around 3.8t/ac to 3t/ac, spring barley fell from 3t/ac to 2t/ac, while winter barley yields dropped from 3.75t/ac to 3.4t/ac.
In contrast however, grain prices were up at least €65/t, increasing from €130/t for green barley and wheat in 2017 to €195-200/t in 2018.
Stronger demand for straw also resulted in straw prices increasing sharply, rising from €15/bale (4x4) to €22-25/bale, but returns year-on-year were generally unchanged due to a halving of straw yields as a result of the drought.
Describing 2018 as a "freak year", Mr Hennessy urged tillage farmers to plan sowings and changes to their business based on more "normal weather years" such as 2016 and 2017, or based on trends identified over the previous three to five years.
The overall trend in 2017 eProfit Monitor results for tillage holdings - which were based on the results of 340 farms with over 25,000ha - was a marked increase in income compared to 2016. The ePM average net margin for tillage farmers analysed was €343/ha, which compares to €106/ha in 2016.
Farms categorised as predominately spring cereals gave the lowest returns at €261/ha, with farms categorised as winter and spring cereals returning an income of €332/ha.
It's expected this trend may continue in 2018 as growers with a mix of crops returned higher yields and output than those with spring cereals only.
There was a wide variation in crop performance across the analysed farms in 2017.
Looking at all the cereal crops, winter wheat produced the highest margin at €433/ha compared to €263 in 2016.
One of the non-cereal star performers in 2017 was winter oilseed rape with an increased yield of 1.3 t/ha, which increased average margins to €511/ha.
Meanwhile, this year's crops are in excellent condition. Indeed, some growers are worried that crops are progressing too quickly and contend that a drop in soil temperatures and a slowdown in growth is now needed.
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