Average income of farmers rises 27%

THE AVERAGE farm income was €21,500 last year according to the Irish Farmers’ Association (IFA), marking a 27 per cent increase on 2010.

The figures – which show an average wage well below the industrial average of €32,000 – include part-time farmers who may have other income sources.

According to the IFA’s Farm Income Review, the single farm payment and other direct payments accounted for over 70 per cent of farmers’ incomes in 2011.

In total, €1.3 billion was paid out through the single farm payment in 2011, and €550 million in additional direct payments.

The agri-food sector has been one of Ireland’s strongest economic performers in recent years, with farmers benefiting from high prices for most products, in what is a traditionally cyclical industry.

According to the IFA study, milk prices were up 12 per cent on the year, while cattle prices were 18 per cent higher, though the potato sector suffered, experiencing a price drop of over 30 per cent.

Stronger food prices offset the effect of higher input prices. During the year energy prices rose by 15 per cent, feedstuffs were up 16 per cent while fertiliser costs increased by 22 per cent.

For this year, the IFA predicts another strong year for the export sector, which will benefit from the weak euro.

However, IFA chief economist Rowena Dwyer warned that economic uncertainty could have an impact on prices and demand this year. “The turmoil in the financial markets is having an erratic impact on commodity markets, with no clear price pattern linked to supply-demand balances,” said Ms Dwyer. “In addition, the lower revised growth forecast for the UK market in late 2011 is a cause for concern as over 40 per cent of agri-food exports go there.”

The study also found that the number of farmers with other incomes has decreased in the last few years in tandem with the economic downturn.

According to a recent Teagasc National Farm Survey, 51 per cent of farm households had an “off-farm” job in 2010, down from 58 per cent in 2007.

The IFA 2011 review also found signs of increased capital investment in the agricultural sector.

However, delays in payments continued to be an issue in 2011, the agency said, particularly for State agri-environment schemes, such as Reps (rural environment protection scheme) and AEOS (agri environmental options scheme).

The schemes are designed to incentivise farmers to farm in an environmentally friendly way.

The IFA looked at the total value of agricultural output plus direct payments to calculate farm income, less the cost of inputs, wages and depreciation for the study.

The research, which used data from the CSO, Teagasc and the Department of Agriculture, covered some 100,000 farmers, both full time and part time.