It’s a record year for farming, and particularly for dairy farming, with Teagasc economists estimating an over 30% increase in the value of output from dairy farms, a sector far outstripping the national economy’s EU-leading 5% growth.
This is largely due to a spectacular increase in world dairy commodity prices (particularly for butter), and 36c per litre paid for milk to Irish farmers (compared to 28c in 2016).
Meanwhile, dairy farmers expanded their output by 8%, and the resulting income arising on the average dairy farm (with 60 hectares, 72 cows, and 1.4 labour units) is expected to exceed €90,000.
This compares with about €52,000 in 2016, when markets were not so favourable, and dairy farm incomes fell by 17%.
There has always been a gap between incomes earned in the dairy sector and in other farming activities, but this became an even wider chasm this year.
Nevertheless, most farming sectors had an acceptable year, compared to earlier years.
The other sector which had a particularly improved year was pig production, with feed costs 10% lower than the five-year average. Pig prices rose by 13c to 162c per kg.
The profit margin over feed increased from 43c per kg to 58c, and pig output increased by 90,000 head, or about 2.5%.
World grain prices have been low for some time, reducing cereal farm incomes, and earlier estimates in 2017 suggested this too would be a bad year.
But record yields for spring barley have boosted profit margins this year, by about €50 per hectare overall.
However, there is a serious problem in the cereal sector, with healthy profit margins for only one third of farms, another third breaking even, and losses for the remaining third.
Incomes on beef farms with a suckling enterprise are stable at a low level in 2017.
A slight improvement in margins and incomes is the outcome on cattle finishing farms.
Profit margins in lamb production have improved by 20% in 2017, due to increased output and higher prices.
Both beef and sheep enterprises remain heavily dependent on subsidies for adequate income.
And the dairy boost may be short-lived, with the milk price predicted by Teagasc to fall 10% in 2018, to 32.3c per litre. Despite this, milk output is expected to grow by 4%. The net profit margin per hectare is expected to fall about 22%, but this outcome would still result in income levels above those experienced in any other year except 2017.
Pigmeat prices and profit margins are also forecast to fall in 2018.
Beef prices are however predicted to increase, due to strong EU demand, and a reduction in supply.
Sheep meat prices are expected to fall.