There is a continuing interest from farmers wanting to invest in their farms, with a particular interest in investments that will improve farm sustainability, according to AIB head of agriculture Donal Whelton.
While noting that AIB doesn’t look at its lending to the agricultural sector in any one year in isolation, Whelton said that in terms of the lending patterns so far in 2022, farmers are seeking to borrow to improve animal welfare standards on farm, invest in improving soil fertility and grassland management.
Responding to questions from the Irish Farmers Journal, the AIB head of agriculture also said than in relation to farmers’ savings during the pandemic, “the best indicator of the financial strength of any sector is the level of overdraft utilisation”.
He said: “At the fourth quarter of 2021, the agri sector had the lowest levels of overdraft utilisation for the past five years.
“Into the first quarter of 2022, outside of the pig sector, we haven’t seen a significant increase in demand for working capital. However, given the relatively strong output prices currently, outside of pigs, it may well be later in the year or into Q1 2023 before we see any increase in requests.”
However, Whelton said that he would encourage any farmer that requires or envisages that they may require cashflow support later this year, to come and talk to AIB as “early as possible” as it has a “range of options to support agri customers”.
He highlighted a finding from Ipsos MRBI agriculture survey commissioned by AIB in April which highlighted that farmers were “very open” to sustainability initiatives and investments, with the incorporation of clover and extending the grazing season among the measures of most interest.
AIB is partnering with the Irish Grassland Association for its upcoming dairy summer tour and currently participates in the Teagasc Signpost programme, all with aim of supporting farmers improve farm sustainability, according to Whelton.