Rising costs remain a key source of concern for farming families

WHILE 2022 may have been a reasonably profitable year for some farming sectors, rising input costs are increasingly becoming a major source of concern for many farmers.

That is among the key findings of a new survey commissioned by Ifac, the country’s largest farming, food and agribusiness professional services firm.

Their fifth in the series of annual Irish Farm Surveys petitioned the views of 1,160 farmers across the country on the major issues that are at the forefront of their minds.

The report confirmed that, for the second year in succession, the impact of the ongoing cost of living crisis was the most likely worry keeping them awake at night.

Three-quarters of respondents (up by 10% on last year) said their biggest concern for the year ahead rising cost of essentials such as feed, fertiliser and energy.

While just of half of respondents (54%) said they were concerned about gas and electricity costs, only a third admitted they had not reviewed their energy provider during the previous 12-months.

“This is a potential missed opportunity when small savings can still be achieved by switching provider,” said the report.

Staying on matters fiscal the survey found that, despite this sustained period of financial pressure, more than half of respondents still do not put budgets in place. Moreover, with interest rates continuing to creep up, more than a third (37%) have not reviewed the borrowings for their businesses over the previous12-18 months.

With sustainable practises at the forefront of many people’s minds, meeting climate targets and protecting the environment was another issue addressed in the survey.

More than half of those surveyed said the biggest obstacle to adopting new renewable projects was a combination of the high level of investment required coupled with low returns.

However, to help tackle rising energy costs and for long-term sustainability, 41% say they would lease land to a solar or wind project if the opportunity arose.

“This signals an appetite for farmer-developed projects, such as wind energy solar panels on farm, when targeted schemes come into effect,” said Ifac.

Nitrate efficiency, to protect water quality and the environment, is another focus for Irish farmers – over a third (35%) have not checked if the nitrate banding rates will affect their farms.

“The recent derogation changes and the introduction of the Nitrates Action Plan are likely to have far-reaching income effects for a large cohort of Irish dairy farmers,” said Ifac.

As in previous surveys, the issue of succession still requires some focus, with more than two-thirds of farming families yet to identify a successor

“While succession can be an emotive hurdle for many farming families, over a quarter (27%) of farmers surveyed say the biggest barrier is the viability of the farm business, making it the number one succession challenge in Ireland today,” said Ifac.

Entitled ‘Championing a Sustainable Future’, the full Ifac Irish Farm Report can be downloaded at www.ifac.ie.

In addition to featuring sectoral analysis and tips, the report also informative case studies and helpful articles for Irish farmers on topics including succession, renewables, nitrates banding, organic farming, interest rates, sustainable investments, employment and the Fair Deal Scheme.

Other key takeways from Ifac report: 

Overall:

56% of farmers have a positive outlook for the year ahead - with 74% planning to still be farming in 5 years.

40% would consider organics.

Financial:

Fuel and transport costs were also a key concern for 51% of farmers.

57% are worried about regulations and bureaucracy.

48% say the cost is the biggest barrier to introducing more technology on their farms.

22% complete budgets and/or forecasts on a monthly or quarterly basis.

Succession:

60% of farmers have a structured pension plan in place.

90% of farmers have limited or no understanding of the Fair Deal Scheme.

44% say carrying on the family name is not a factor in determining a future successor.

Employment:

44% of farmers with employees agree to wages in net terms.

32% of farmers struggle to find available employees – this is the main obstacle to attracting talent for the second year in a row. Other common issues are pay scales.

Only 33% of farm employers have contracts of employment in place.