Farm Ireland

Tuesday 12 December 2017

Too early to say recovery is underway

Declan O'Brien

Declan O'Brien

Talk to any group of farmers these days and someone will invariably ask whether we're over the worst of the economic downturn.

Facts and figures will be fired out left, right and centre to support the various opinions, but in reality nobody really knows.

Some positive signals are emerging, but it is still too early to suggest that these herald the start of a general recovery.

Milk prices have improved and there is little doubt that world markets have finally bounced off rock bottom.

However, the recovery remains fragile and with serious quantities of both butter and skim milk powder still held in EU stores, careful market management on the part of Brussels will be required during the first half of this year and beyond that into the future.

There has also been good news of late for sheep farmers. Factory quotes have topped 450c/kg and more is being paid to secure supplies.

Lamb producers will hope that these price levels can be maintained through the spring -- even if the harsh experiences of recent years tell a different story.

The QPS grid is the big news on the beef front and its rise or fall could very well be the tale of the year.

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The factories have moved to raise the base price for steers and heifers by between 5c and 10c/kg. In addition, animals grading fat class 4= are to be included in the base price until the end of this month.

Both are positive steps but there is a fair degree of farmer scepticism regarding the new grid and, rightly or wrongly, this will only be assuaged by improved prices.

Cereal growers must feel that their fortunes have to turn and that they cannot be expected to endure a third hammering in as many years.

While the outlook has improved somewhat, a serious lift in prices is needed to restore confidence.

Hopefully the dismal returns of 2009 will not be repeated this year -- but serious challenges remain.

Irish Independent