Stephen Cadogan: Even milk producers remain optimistic about their farming

Give a farmer a fine day to get the work done, and he or she is content.

There’s cause in the 2015 Irish Examiner ICMSA farming survey results to support that simple theory.

Even 81% of dairy farmers in the survey said they remain optimistic about their chosen farm enterprise — despite enduring a milk price slump from as high as 40c to as low as 26c per litre since the summer of 2014.

Irish Creamery Milk Suppliers Association President John Comer says the average dairy farmer income for the first eight months of 2015 has fallen to about €9,300.

They work a 60-hour week on average — so they have fallen nearly to the social welfare earnings level, and considerably below the statutory minimum wage, according to Comer.

How then can their level of optimism be explained? Dairy farmers were well represented in this survey, at 22%; on the ground, they number only about 18,000 of the country’s 140,000 active farmers.

It can certainly be concluded that milk producers are taking the fall in their earnings in their stride, and are fully aware that their exposure to the world dairy market leaves them prone to wild fluctuations and volatility in earnings.

So the current price slump is seen as no more than a blip, which Irish dairy farmers can cope with, thanks to their low production costs, and relatively low farm debts (only 19% of those surveyed think their farm debt is too high).

They have been through volatile times before, and they don’t expect them to end (which might explain why a surprising 19% think the family farm will be sold after them).

Some insulation from the ups and downs of farming is offered by off-farm work; in this survey, the number of farmers with a job off the farm has grown from 28% to 36% over the past year, quite a sizeable jump (possibly reflective of the return to strength of the building sector).

That too is cause for optimism, reducing dependence on inconsistent farming earnings.

The rise in optimism of livestock/cattle farmers, from 53% to 64%, reflects that it has been a year of higher cattle prices, with sheep farming also an improved business this year.

It is less easy to explain the rise in optimism in tillage, from 66% to 78%.

A possible explanation is that all farmers have bought into the future of dairy farming without quota restrictions, and believe that it will lift all boats.

Grain growers enduring a third year of low prices may console themselves with expectations of expanding milk production increasing the demand for tillage crops, or opening up new markets for all landowners, from dairy heifer rearing to land leasing.

In the survey, few non-dairy farmers are interested in switching to dairy farming — but that doesn’t mean they are not ready to benefit in other ways from the Irish farming shake-up since milk quotas have gone.

Maybe farmers are surprisingly optimistic because they know a wet year like 2009 can make their lives a misery, and they are thankful for a year of more predictable conditions like 2014-2015. It hasn’t been ideal for farmers on wet land, but on the other hand, farmers on drought-prone land can’t complain this year.

In any case, farmers know it isn’t much use complaining. Although 73% agree to some extent when it is put to them in this survey that farming is one of the hardest ways to earn a living, they know it is up to themselves to make a go of it (with, ultimately, the EU looking after their interests, which explains why 98% in this survey say Ireland should remain part of the EU).

This year, sun and rain have kept the grass and other crops growing.

But farmers would do well to follow the weather trends in faraway places also. You don’t need the weatherman to know that Irish farming may have to change,in order to reduce the emissions causing global warming and weather disasters around the world.

In this survey, just 15% believe that Irish farmers should cut back production in order to reduce global warming. They are likely to be proved wrong — but that’s just another bump in the road ahead for farmers to eventually knuckle down to.


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