Importance of wise investments stressed
Investments needed to reduce work load, and increase the time available for more gainful activity are rated the next priority.
In Todays Farm, the magazine issued to top Teagasc clients, he advised farmers to “stress test” farmyard improvement projects before taking part in the new Farm Waste Management Scheme.
Dr Kelly reminded readers that many farmers in the 1970s and 1980s who borrowed for investment in farming experienced difficulties, and required rescue arrangements.
He has compiled a score sheet to help farmers determine if it is prudent to invest in their yards. “The positives over the last five years were good milk prices, low inflation and lower construction costs. If the decisions were being made today, all of these factors are worse than then. What really matters here is that you are aware of the trends, and can quantify the risk from lower than expected margins,” he advised.
“Whether own funds or borrowings are used to invest in facilities, the capital tied up is not going to be available for other investment opportunities,” he pointed out.
Thousands of applications are flooding in to the Department of Agriculture ahead of a December 31 closing date to avail of grant aid of up to 70% for waste maanagement.
Dr Kelly posed the following questions for applicants:
What will the investment return in farm profit?
How is it being funded?
Is there a long term commitment to continue in farming?
Is there a multifunctional option for use of facilities if enterprises on the farm change?
