€100 million of SFP to be invested off farm

26 August 06 : Farmers are planning to siphon off over €100 million of the Single Farm Payment into off farm investments such as property, shares and new businesses.

According to a survey commissioned by the Irish Farmers Journal, 8% of the massive €1.3 billion in farm payments will be invested off-farm. Broadmore Research carried out the study with the input of over 400 farmers in 12 locations around the country.

Property is popular

The most popular choice for off-farm investment is property in Ireland.

However, foreign property is a close second, with 16% of the 406 farmers surveyed stating that they were considering investing off-shore.

This compares to just 3.4% of the farmers surveyed who have invested in foreign property in the past. Shares appear to be becoming less popular with 6% responding that they are considering investing in shares.

Up to 10% of the farmers who participated in the research said that they had invested in shares in the past. The research shows that one in five farmers invested outside the farm gate over the last five years. And this figure looks set to rise with a resounding 87% of past investors stating that they intend to continue investing off-farm and 36.7% of all respondents stating that they are considering investing off-farm over the next five years.

Majority of SFP to stay on-farm The majority of the SFP will, however, be spent inside the farm gate.

The survey showed that 72% of the farm payments will be used to cover day to day running costs or for on-farm investment.

Subsidising farm operations Using the payments to cover the cost of production accounts for most of the money. Of the farmers surveyed 71% said they would use at least three-quarters of their SFP to subsidise their farming operations.

This proves that the money from Europe is still vital for the viability of most farming operations. Somewhat alarmingly, the survey also noted that a third of farmers plan to reduce stock numbers as a result of the new SFP.

Majority of SFP to stay on-farm

The majority of the SFP will, however, be spent inside the farm gate.

The survey showed that 72% of the farm payments will be used to cover day to day running costs or for on-farm investment.

Subsidising farm operations

Using the payments to cover the cost of production accounts for most of the money. Of the farmers surveyed 71% said they would use at least three-quarters of their SFP to subsidise their farming operations.

This proves that the money from Europe is still vital for the viability of most farming operations. Somewhat alarmingly, the survey also noted that a third of farmers plan to reduce stock numbers as a result of the new SFP.