Farmers can expect small drop in income next year
He was addressing the Teagasc Situation and Outlook in Agriculture conference in Dublin, where his colleague, Billy Fingleton, predicted that milk prices will fall by about 4% in 2004.
EU compensatory payments will offset this price drop, but lower calf prices and cost increases will put continuing pressure on profits, he said.
For cattle farmers, Liam Dunne said a drop in profit margins of around 100 per hectare (40/acre) in on the cards in 2004.
Fiona Thorne told the conference, “The indications for 2004 are for some drop in margins from grain growing.”
“However, this will depend greatly on weather conditions in the major international grain growing regions. The margins from sugar beet and potatoes are forecast to increase, primarily due to increases in yields”.
Teagasc Chief Pig Adviser, Michael Martin said prospects for pig prices in 2004 are reasonably good, but escalating feed costs will severely curtail any increase in margins, leading to a further difficult year.
Liam Connolly predicted a further decline in sheep farm profit margins, but the sector will still have the highest profit margin after dairying, substantially ahead of either beef or cereal growing.
The 10 year cycle of decline in Irish sheep numbers was halted in 2003, with a small increase in the national breeding flock, even though higher production costs and lower lamb prices led to a drop of around 5% in sheep margins.
