The facts of the input price increase at farm level were laid bare at the Teagasc National Dairy conferences this week in Cork and Mullingar. The cost of milk production has spiralled in recent years. Dairy farmers are fortunate international milk markets and farmgate prices have followed. While Teagasc chair Liam Herlihy opened the Cork conference suggesting he had never seen a more profitable year in dairy farming, when you crunch the numbers the marginal increase in profit is much smaller than some expect.
Milk price gets the limelight and makes all the headlines when it is high. The focus at farm level often then goes off cost management and typically costs of production increase. At the conference, Teagasc adviser Adrian O’Callaghan outlined what unfolded in 2022. He said Teagasc data shows the cost of keeping a milking cow in 2022 has risen from €1,656 to €2,218 per cow, a 33% increase. This is taking the actual costs for 2022, adjusting for item price increases, and projecting forward to the end of the year. If we include a charge for owned labour and land, that’s another €500 per cow.