Farm costs are rebounding in 2021, Teagasc economist Trevor Donnellan said at the webinar launch of the SCSI/Teagasc Agricultural Land Market Review & Outlook 2021.
“Last year was largely a story of lower production costs on farmers,” he said.
That helped average farm incomes rise by 6% in 2020.
“However, in 2021 fertiliser costs are up,” he said. “Feed costs, too, are expected to be higher.” These costs are “going back to where they were”.
There’s an ongoing increase, over time, in prices for lamb
However, Teagasc expects average cattle, sheep and milk prices to also increase in 2021.
Sheep farmers’ incomes appeared to be pulling ahead of cattle farmers’ incomes, he said.
“There’s a bit of a gap appearing there,” he said. “There’s an ongoing increase, over time, in prices for lamb.”
He said that Teagasc expected significantly lower average pig prices in 2012 because of lower demand in Asia.
He noted that there was continuing volatility for tillage farmers.
Overall, average farm income could rise 3% in 2021, he said.
I believe there will be a place for a blend of online and in-room
Auctioneer James Lee said that traditional “in-room” auctions of land will resume when permitted. But online auctions would continue too. Farmers were very adaptive – even farmers in their 80s were well able to bid online for livestock via their smartphones, he said.
“I believe there will be a place for a blend of online and in-room.
“We’ve seen it on the livestock side with 60-65% of stock purchased at the ringside and 35-40% of stock purchased online,” said the director of Newport Mart, who also handles farmland sales through REA John Lee Estate Agents.