Low food prices hit NI farm incomes

Falling prices have been blamed for a 25% drop in Northern Ireland’s total income from farming (Tiff) in 2019.

The provisional income figure, published by the Department from Agriculture, Environment and Rural Affairs (Daera), fell from £386m in 2018 to £290m last year.

Farm business incomes

Initial estimates at farm level reflect the overall drop with average farm business incomes across all sectors down by 14% to £24,679 from £28,612 the previous year.

The provisional figures suggest declines in the cereals, dairy, cattle, sheep and mixed farm types between 2018-19 and 2019-20.

For all these farm types, the downturn in their incomes is mainly attributed to lower output prices in the 2019/20 accounting year, according to a Daera statement.

In contrast, pig farms are expected to show an increase in incomes due to higher pigmeat prices over the period.

See also: What the new Agriculture Bill contains for farmers

Output

Total gross output was 2% lower at £2.15bn in 2019. Within the overall figure, arable farms increased output value by 7%. But the livestock sector, which dominates agriculture in the province, saw output fall by 4%, dragging down the overall figure.

Dairy
Dairying remained the largest contributor to the total value of gross output at £654m in 2019. However, this was down by 4% between 2018 and 2019 as the average farmgate milk price decreased by 6% to 27.1p/litre.

Beef
Beef cattle output was 7% lower at £427m last year despite a marginal (0.6%) increase in volumes due to heavier carcass weights rather than throughput, which dropped by 2%.

The key to lower output was a sharp drop in beef prices. The average producer price for finished clean cattle was £3.26/kg in 2019, down 6.6%, while culls made £2.25/kg, a fall of 10.6% on 2018.

Sheep
A sharp, 18% drop to £66m in output for the sheep sector in 2019 again reflected falling prices.

The Daera figures show prices were 9% down on year earlier figures at £3.87/kg. That is despite a 2% decline in the volume of sheepmeat sold made up of a 5% drop in numbers and increased average carcass weight of 22.5kg.

Crops
Field crops increased output by 7% in 2019 to £71m, on increased production volumes of cereals and potatoes. The increased yield for cereals was attributed to a switch to winter cropping in 2019.

Cereals accounted for £33.4m output (up 3%) while potatoes enterprises saw an increase of 11% to £23m.

Inputs

The total value of input costs increased by 1% in 2019, to £1.62bn.

Feed
Feed costs accounted for 53% of the total which at £851m was 2% lower than in 2019 as growing conditions produced plenty of high-quality forage.

This was reflected in a 2% fall in the volume of feedstuffs purchased and a 0.5% increase in the average price paid a tonne.

Fertiliser
Growing conditions also meant fertiliser use was down 10% but prices a tonne jumped 12%.

Machinery
Total machinery expenses also increased to £161m (up 2%) in 2019, mainly as a result of a 3% rise in the cost of fuel and oils.

Reaction

The fall in prices has prompted an angry reaction from Ulster Farmers’ Union (UFU) president Ivor Ferguson.

“The figures stress the unsustainable financial situation that farm families across Northern Ireland endured last year,” Mr Ferguson told regional news website Independent.ie.

“It is a clear indicator that the uncertainty farmers have been dealing with, combined with increasing machinery, feed and fertiliser prices over the past few years, is beginning to seriously impact their farming businesses.”

NI farm minister Edwin Poots said the figures were hugely disappointing.

“Farmers work extremely hard and maintain very high standards.

“At the moment, they are not being fully rewarded for that effort and this is something that needs to change. To this end I will be writing to the main processors and the supermarkets asking how they can help farm businesses to be more sustainable.”

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