Cattle farming falling behind

BOTH grain production and dairy farming are now emerging as improving alternative enterprises for cattle farmers.

Not only are grain markets looking buoyant, possibly for some years ahead, but farmers are becoming more familiar with methods of forward selling.

A cattle farmer can decide today to plant some grain next spring, and can lock in to profits today from his grain harvest next year with some certainty.

In sharp contrast to live-and-hope beef prospects, all grain merchants now offer to contract dry and store harvest grain for growers who wish to wait for a better price and sell their grain later.

Optimism was plentiful at the recent Teagasc National Tillage Forum, with news of tighter global stocks of wheat and barley after the harvest, and prices well supported at current levels.

The forum heard from a farmer who trades his grain every month of the year, through forward selling.

Unlike the beef market, the grain market has improved its offering to the grower, making available forward selling and contracts.

The grain grower can practically decide when planting what price he is willing to sell his next harvest for, whereas the winter finisher of cattle has to take a spring price, like it or not.

Grain growers will still have to cope with sudden price changes, and won’t always be on the right side, as they were last July, which saw the biggest monthly grain price since 1959.

However, reasonably good medium-term prospects in grain markets now give livestock farmers an opportunity to at least diversify into mixed farming.

Meanwhile, the chance to get into dairy farming in 2015 must be on the minds of a lot of farmers locked out of the consistently most profitable enterprise up to now.

The predominant route for expansion will be from existing family-run dairy units, but with Teagasc expecting over two-thirds of cattle farms in any given year to continue in loss-making situations, there is a strong incentive for cattle farmers to take advantage of the scrapping of milk quotas.

Price prospects for the sheep sector are also positive, and likely to stay that way, largely due to the continuing decline in production in continental Europe – which would take many years to recover.

As for cattle farmers, they can only hope that land use shifting into the other enterprises will improve their situation.

Maybe it was the realisation that cattle farming has slumped into last place among the enterprises competing for Irish land use that has prompted beef processors to be more vocal about guaranteed minimum prices for cattle slaughtered next spring.

Unfortunately, they will get a cynical reaction from most cattle farmers, burned once too often by their cattle dying in debt.

IFA president John Bryan has said the minimum price guarantees being offered are totally inadequate for winter finishers, who can no longer afford to carry the full risks of beef production, after too many loss-making winters.


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