Dairy farm incomes in the Republic soared to record levels last year as increased production and higher output prices outweighed a hike in input costs.
According to farming agency Teagasc, dairy farmers earned an average of €97,350 in 2021, an increase of 23 per cent or €18,300 on 2020 levels. Despite higher production costs, which rose by 11 per cent, a further increase in milk output volume and “significantly higher milk prices” benefited dairy incomes, Teagasc said.
Dairy has long been the most profitable segment of Irish farming. Since the lifting of EU milk quotas in 2015, the sector has ramped up production significantly but the increase has coincided with a major deterioration in water quality.
Teagasc’s latest annual farm survey suggested the average farm income in the Republic last year was €34,367, up 26 per cent on an annual basis. The average figure, however, includes many small, part-time beef and cattle farmers and is therefore low in comparison with the more profitable dairy and tillage sectors.
Higher output prices across most farm enterprises were the main driver of the increase in farm incomes in 2021, the agency said, while noting the scale of the increase in income varied considerably across farm systems.
In the “cattle other” system, which comprises mainly beef finishing farms but also includes farms selling store cattle, average income rose by 6 per cent to €16,416 while sheep farms saw incomes rise by 14 per cent to €20,500.
Due to higher fertiliser, feed and contracting charges, production costs on tillage farms increased by 34 per cent last year, a much larger percentage increase than those seen in the grassland systems, Teagasc said. However, the average income on tillage farms rose by 77 per cent to almost €59,000, primarily on account of “good production conditions”, which led to higher crop yields.
“Rising international agricultural commodity prices were a feature of 2021 and these price increases led to higher farm level output prices in Ireland,” it said.
While pig farm incomes are not reported in the Teagasc survey, separate data showed that incomes here fell due to higher feed prices and other increases in input costs, combined with a significant fall in pig prices.
Despite the increase in incomes, Teagasc said farms experienced a major hike in production costs last year as key farm input prices for fuel, feed and fertiliser all rose. This escalation in costs has since intensified in 2022, it said.
“As the global economy began to emerge from the slowdown caused by the Covid-19 pandemic, supply chains struggled to respond to increased demand, leading to sharp increases in crude oil and natural gas prices, with knock on increases in fertiliser, fuel and electricity prices as well as prices for a wide range of goods and services across the economy,” it said.
Separate data from the Central Statistics Office on Tuesday detailed a rapid increase in input costs in the 12 months to April. The most significant change was in the price of fertilisers which rose by 178 per cent. This trend of input price increase was also seen in energy and feed prices which were up 43 per cent and 27.3 per cent year-on-year in April.
FAQs
In spite of higher Dairy system production costs, which rose by 11 percent, a further increase in milk output volume and significantly higher milk prices, resulted in an average dairy farm income of €97,350 in 2021, an increase of 23% or €18,300 on the 2020 level.
What is the average income of a dairy farm in Ireland? ›
The average dairy farm income in 2022 was €148,598, an increase of 50% on the 2021 level, the final results of Teagasc's national farm survey (NFS) have confirmed.
How much does the average farmer make a year in Ireland? ›
The national average salary for a Farmer is €31,863 in Ireland. Filter by location to see Farmer salaries in your area. Salary estimates are based on 30 salaries submitted anonymously to Glassdoor by Farmer employees.
Is dairy farming profitable in Ireland? ›
Only in Ireland, thanks to its lower costs of production, were milk producers able to generate what the European Milk Board (EMB) deemed a fair income of €22.23 per hour, in the five years from 2015 to 2019.
What is the most profitable type of farming in Ireland? ›
Dairy farms are consistently the most profitable farms. Cattle rearing( 11%), Dairy (9%) and Sheep (9%) saw an increase in Family Farm Income compared to 2018 while Tillage farms (-15%) and Cattle other (-6%) saw a de- crease on 2018 figures.
How much profit does a dairy cow make in Ireland? ›
Top performing dairy herds are exceeding €1,000 profit per cow. At stocking rates of 2.5 cows per ha these farms are generating over €2,500 profit per hectare.
Who is the biggest dairy farmer in Ireland? ›
Greenhills farm is Ireland's largest dairy farm where the Brownes operate from a 486ha (1,200 acres) platform, of which 166ha is leased.
Is the average farmer a millionaire? ›
In 2022, the median U.S. farm household had $1,376,404 in wealth. Households operating commercial farms had $3.5 million in total wealth at the median, substantially more than the households of residence or intermediate farms.
How profitable is farming in Ireland? ›
Taking account of the income developments across the various farm systems, the average family farm income in Ireland rose by almost 32% in 2022 to about €45,800. However, it is important to emphasise that this increase is almost entirely attributable to the sharp rise in dairy and tillage farm incomes in 2022.
How much tax do farmers pay in Ireland? ›
The standard rate of tax is 33%. CAT Agricultural relief at 90% is available in respect of agricultural property gifted to or inherited by active farmers and to individuals who are not active farmers but who lease out the property on a long-term basis for agricultural use to active farmers.
The economic analysis shows that Jersey crossbred cows grazing a perennial ryegrass and white clover-based sward is the most profitable system, producing a net profit of €2,751/ha. This compares to a net profit of €2,639/ha for three-way cross and €2,632/ha for Holstein Friesian cows grazing the same sward.
How profitable is a dairy farm? ›
Ten thousand simulations were run, using actual Farm Credit data for New England dairy farms. Eighty percent of the simulations showed the LODG model farm generating between $1.30 and $4.56 of profit per cow. The actual profit per cow of large New England dairy farms was $1.71 during the same time period.
What is the average size of a dairy farm in Ireland? ›
Dairy Farms
Ireland's dairy industry is built on the tradition of intergenerational family farming. There are approximately 17,000 multigenerational family-owned dairy farms. The average size of an Irish dairy farm is 32.4 hectares or 0.32 square kilometres with the average herd size being 83 cows.
How many acres does the average farmer own Ireland? ›
While there are now just 135,000 farms in Ireland, down from 223,000 in 1980 and 359,000 in 1916, the lack of land continues to cause problems. This is despite the average farm size in Ireland more than doubling over the last century, increasing from 34 acres in 1915 to 82 acres in 2020.
What is the most profitable farming enterprise in Ireland? ›
Dairy farming is Ireland's most profitable agricultural enterprise. Research plays an essential role in improving its productivity and sustainability, and much of Teagasc's work is done to help support farmers and their success.
What is the best cash crop in Ireland? ›
Crops in order of the highest net margin:
- Winter wheat;
- Winter barley;
- Spring malting barley;
- Spring wheat and spring beans (including protein payment);
- Spring oats;
- Spring feed barley;
- Winter oats;
- Spring oilseed rape.
Taking account of the income developments across the various farm systems, the average family farm income in Ireland rose by almost 32% in 2022 to about €45,800. However, it is important to emphasise that this increase is almost entirely attributable to the sharp rise in dairy and tillage farm incomes in 2022.
How much do farmers get for milk in Ireland? ›
The farm gate price of cow's milk in Ireland increased between the years of 2016 and 2022. From 2016 to 2017, there was a large increase of approximately 30 percent in the farm gate price. In 2022, the farm gate price was over 53 euros per 100 liters.
Is being a dairy farmer profitable? ›
Some small operations may be exceptionally well-managed, while others may have below-average input prices or above-average product prices. As a result, even though small farms show losses on average, some can be quite profitable.
How many dairy cows per acre in Ireland? ›
The target for most dairy farmers in future will be 2.5 cows per ha (1 cow/ac). For efficient milk production, this stocking rate requires grass production of around 14 tonnes of dry matter per hectare which is 40% higher than the average production on Irish dairy farms at present.
:quality(70)/cloudfront-eu-central-1.images.arcpublishing.com/irishtimes/ELAIRUZUX5AS5CAPTDJXP7S23E.jpg "Average dairy farm income in Ireland surges to record €97,350 (1)")
:quality(70)/cloudfront-eu-central-1.images.arcpublishing.com/irishtimes/C6QFZR45MDM7ZCKF5QSI3FWTFI.jpg "Average dairy farm income in Ireland surges to record €97,350 (2)")
:quality(70):focal(2040x1009:2050x1019)/cloudfront-eu-central-1.images.arcpublishing.com/irishtimes/J4525V2XSBAEDOOLFCZCEMSM2I.jpg "Average dairy farm income in Ireland surges to record €97,350 (3)")
:quality(70):focal(2073x967:2083x977)/cloudfront-eu-central-1.images.arcpublishing.com/irishtimes/HLRFSLNBGJGJPI6QOC55SSUED4.jpg "Average dairy farm income in Ireland surges to record €97,350 (4)")
