Coveney welcomes 33% increase in farm production output

AGRICULTURE Minister Simon Coveney has welcomed the Central Statistics Office figures indicating that farm prod-uction output has jumped by a third during 2011.

The CSO estimate of a 33.4% rise in operating surplus showed growth in production levels across most agriculture sectors.

Mr Coveney said: “The increase in income was particularly strong in the cereals sector where improved prices resulted in a 52.5% rise in the output value of the sector.”

The milk sector also enjoyed a good year, with output value up €303.9 million or 19.8% on 2010. Similarly, the livestock picture showed increases in output value with cattle (16.7% or €250.1m), pigs (16.1% or €52.9m) and sheep (9.4% or €12.1m) all showing improvement.

Mr Coveney was also pleased to see a 5.6% increase in volume output in the pigmeat sector, despite the challenges it has faced this year.

Total direct payments to the agriculture sector are expected to amount to about €1.94m, which includes payments under the Single Payment Scheme, the Area Based Disadvantaged Compen-satory Allowance Scheme, REPS, forestry premiums, disease compensation and other smaller schemes.

Mr Coveney noted the increase in input prices, which include a 22% increase in feedstuff prices. Fertiliser prices also rose by 9.6%, and fertiliser volume was down 8.3%.

“These input costs are likely to remain high given global trends and it is important that such costs are recognised when producer prices are being discussed,” he said.

“2011 has been another excellent year for the sector and the outlook for 2012 is undoubtedly posi-tive, with renewed strength in the sector leaving it well placed to increase its already vital contribution to the country’s economic recovery.”

Meanwhile, IFA president John Bryan also welcomed the statistics, but noted that farm incomes remain well below the average industrial wage.

“The CSO’s provisional output and income estimates for agriculture in 2011 reflect the growth in value of the agriculture sector and its important contribution to the economic recovery, in particular its role in the rural economy. However, it must be remembered that average farm incomes in 2011 will still be only around €23,000,” he said.

“Direct payments represented over 70% of national farm income in 2011. This highlights the importance of retaining the single farm payment and rural development programmes in the CAP post-2013 to underpin farm incomes, production and agri-food output. This will be the clear message for the EU Commissioner for Agriculture Dacian Ciolos, when he attends the IFA’s AGM in January.”

Mr Bryan noted that over €150m of the 2011 income figure comprised direct payments that were due in 2010, but were not paid until early 2011. The real increase in income at farm level in 2011 was therefore closer to 25%.

Another separate study in November, by Teagasc’s Cathal O’Donoghue, noted that the number of unviable farms has increased from less than a third to more than 40% from 2007 to 2010.

The Teagasc study also noted that while farm input costs over the period had increased at the same rate as the level of inflation in the wider economy, farm output prices rose at a noticeably slower rate.

Mr O’Donoghue noted that the ability of farming units to remain viable had been seriously reduced by the economic downturn as farmers’ options in terms of finding alternative work had drastically reduced.