Dairy farm incomes have continued to rise, with Teagasc expecting the average farm to take home €70,200 in 2019, up 14% on 2018.

These incomes are expected to rise even further in 2020, with an estimate of €76,700 put forward by Teagasc. On a per-hectare basis, dairy margins dwarf those of the other sectors at €1,353/ha net for 2019. A rise of 12%, to €1,514/ha, has been predicted for 2020.

Emma Dillon said the adverse weather in 2018 saw a spike in dairy costs, particularly in feed and fertiliser.

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These fell by 20% and 17% respectively in 2019, bringing the cost per litre of milk down to 23.8c/l.

Milk prices weakened in 2019 but this was offset by an increase in production (up 6%) and a reduction in costs.

The result was an average net margin of 11.1c/l. Dillon said this would increase to 12c/l in 2020.

The improved margins next year will be on the back of a continued increase in production and further reductions in costs rather than an increase in price, which will remain static.

Dillon said increasing skim milk powder prices were being offset by a fall in butter prices.