Optimism in poll remarkable for a sector with such low incomes

The high optimism levels revealed in the annual Irish Examiner ICMSA farming poll are remarkable, for a sector which provides so many of its members with such low incomes.

In the poll, 20% were very optimistic and 52% slightly optimistic about the future of farming in general.

Only 15% were pessimistic.

When asked about the future of farming in their own sector, they gave similar broadly optimistic answers.

They are optimistic despite average incomes earned on farms (excluding income earned by the farmer or his spouse on an off-farm job) as documented by the National Farm Survey, of only €25,000 for several years, with 35% of farms in 2016 earning less than €10,000.

These low farm incomes prevail in the livestock sector particularly, which is Ireland’s largest farming sector, but the poll does not show that livestock farmers are less optimistic than others.

Indeed, they are more optimistic than tillage farmers, or “other” farmers.

Perhaps inevitably against the background of persistent low incomes, there has been a decline in “strong” optimism, with those describing themselves as “very optimistic” about the future of farming consistently falling from 38% in 2013 to 20% in 2017, mirrored by a fall from 38% in 2013 to 19% in those “very optimistic” about their own particular farming sector.

But when the “slightly optimistic” are added in, there isn’t much change over five years, albeit overall optimism was dented in the three middle years.

Not surprisingly, younger farmers are the more optimistic.

Optimism seemed much more muted at Cavan, Tullow, and Claregalway.

However, at Tullamore Show, where 184 of the 569 farmers were interviewed, the message was clear, with 83-85% positive about farming. and only 9-16% negative.

As would be expected, the highest levels of optimism are shown by dairy farmers.

There is no indication either that the threat of Brexit has had any effect on the farmer’s basic optimism.

The improved milk prices of 2017 probably contributed to the recovery in optimism this year.

This question was asked in the poll in each of the last five years, with the percentage of farmers expressing optimism running at 79% in 2013, 69% in 2014, 72% in 2015 and 60% in 2016, with a return to 72% optimism this year.

The low farm incomes which prevailed in 2016 seem to have had some dampening effect on levels of optimism.

However, the 60-79% farmer optimism compares with figures ranging from 25-50% for the Irish population in general in surveys and polls.

High optimism among farmers is good news for the businesses that sell to them, whether agri-businesses or otherwise.

They can be presumed to have done increased business with their farming consumers over the past year, with all farmers except tillage farmers admitting in the poll to spending more this year on new cars, family holidays, clothing, eating out, etc.

One in six farmers in the poll spent more money on a new car in the past 12 months, while one in seven says the same for family holidays.

Overall, farmers under the age of 35 are the more likely to claim they have spent more money on various items and activities in the past 12 months, compared to older farmers.

The range of activities on which tillage farmers had increased expenditure was much narrower.

With earnings in many farm families coming from outside of agriculture, optimism cannot be 100% attributed to how farming is going.

Just over half in the poll said they do not have off-farm income. But about 20% of respondents said the farmer works off the farm, and about 30% said the spouse works off the farm.

However, poll respondents were split on whether the economic recovery had benefited “me and my family”. Here, 43% agreed that they had seen a benefit, while 30% disagreed.

Brexit

High optimism levels in the 2017 Irish Examiner ICMSA farming poll are also remarkable in light of Brexit fears and uncertainties.

We hear about Brexit every day of the week.

But, as a spokesperson for the European food industry said last week, “All we have is uncertainty….

“We don’t know what is going to happen, and if you don’t know what is going to happen, it is very difficult to be prepared…

“Everyone in Brussels is getting very nervous, and there is a huge amount of Brexit fatigue”.

The farmers in the poll were asked whether Brexit has had or will have an effect on farming in Ireland.

A quarter of the sample felt that Brexit already has had an impact, while two thirds felt that it would have an impact in the future.

Only 8% felt that it would have no impact. A third of farmers felt that the Government was doing enough to prepare for Brexit, but almost a half disagreed.

Younger farmers and tillage farmers were much less likely to agree with the idea that the Government was doing enough. When it was suggested that the Government should have a Minister with specific responsibility for Brexit, 55% agreed, while only 20% disagreed with that statement

(see poll results, p16)

.

In general, farmers seem to be well informed on Brexit, its importance and likely impact (insofar as anyone can be, amid the general uncertainty).

The UK accounts for 42% of Irish food exports. The proportion is much higher for beef and for highly processed products such as ready meals, prepared by Irish food firms for the UK multiples.

These markets are clearly under threat, if there is not a satisfactory agreement on trade between the UK and the EU-27.

The immediate effect would be on the food processing industry, where contracts may be lost and factories closed.

The knock-on effect would be on farmers, in the form of lower prices and incomes.

Brexit is not scheduled to occur until March 2019, but has already had a major impact. The world’s financial markets (in their wisdom or otherwise) have decided that sterling is not a currency one would wish to retain in the same volumes as in the past.

That is why the value of sterling has fallen by at least 20% since the referendum. British consumers have not as much money to spend on foreign holidays (affecting our tourism trade) or on goods bought from the Eurozone.

Among the early casualties of the weakness of sterling have been several firms in the Irish mushroom industry.

Three farms with a total of 130 jobs were lost within 100 days of the referendum, while the Tipperary firm of Schiele and McDonald closed last month, with a further loss of 70 jobs. So although Brexit is not a legal reality, it has already had negative effects, and regional Brexit shocks such as this are likely to have affected the poll results.

High levels of optimism is just one of the remarkable findings in this poll.

They are remarkable, but reliable, because 569 farmers represents quite a large sample of a well-defined group which makes up only about one sixth of the national population.

This opinion poll is much more reliable than the polls you see regularly published in the Sunday newspapers, which have a sample size of only about 1,100 for the whole Irish population.

Figures from a poll with such a representative sample, as in the 2017 Irish Examiner ICMSA farming poll can be regarded as accurate to within 4%. So, with 72% of those interviewed saying they are optimistic, it is likely that the real level of optimism among farmers as a whole is likely to be between 68% and 76%.

However, the margin of error is larger for results for smaller groups such as farmers who attended a particular show, farmers in a particular age bracket or other categories.

We must be careful when extrapolating comparisons with results of the poll in previous years.

An apparent change in opinion may be statistical, rather than real, unless the difference is greater than 10%.

Irish Examiner ICMSA farming poll

The Irish Examiner ICMSA farming poll was designed to provide a robust and accurate snapshot of the attitudes, beliefs and opinions of the farming community about a range of issues, both farming and social. The survey involved 569 interviews with farm dwelling adults in the Republic of Ireland.

Fieldwork was completed by Behaviour & Attitudes over a two-week period between August 13 and 27, with interviewing undertaken onsite by Behaviour & Attitudes interviewers across eight agricultural shows. The sample size is large and the data has a statistical margin of error of +/-4%.

The sampling approach involves a random probability method, with interviews being undertaken with attendees provided they worked and/or lived on a farm. 429 interviews were with farmers themselves, 31 with non family, farm employees, and the balance with spouses (66), most of whom -5 out of 6- personally work on the family farm as well.

All data is copyrighted by the Irish Examiner and Behaviour & Attitudes and should be attributed to this source where quoted.

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