Interest payments eat into incomes

DAIRY farmers have led a borrowing splurge which has taken interest payments to more than 10% of Irish farm income.

Farmers’ bank loans have nearly doubled in five years, from €1.6 billion in 1995 to €3.1 billion in 2001.

“While dairy farms now account for less than 30% of farms, they contributed well over 50% of total new investment in 2001”, said Sean Regan, Chief Environment Adviser, at the Teagasc Dairy Conference in Killarney.

He said pollution control legislation and measures such as the EU Nitrate Directive will impose further investment pressures on farmers.

Outwintering pads, earth bank tanks and integrated constructed wetlands are being evaluated by Teagasc researchers.

Results are promising, but it is too early to definitely recommend them.

They could cut investment costs and allow farmers consolidate and expand their business. He said conventional housing and storage costs two or three times more than outwintering pads.

Pads could play an important role on many dairy farms, as an add-on to existing facilities.

He added, “Where tax allowances and building grants can be maximised, the conventional housing systems still have a lot to offer. They are more durable in the long term and contribute more to the asset base and value of the farm,” he said.