The Irish Farmers Association (IFA) has called on all lenders to pass back the reduction to all non-fixed loans and overdrafts facilities to their farmer customers.

It comes after the announcement by the European Central Bank (ECB) of another interest rate cut by a quarter of one percent.

Many variable rates loans and overdrafts will be linked to the Euribor rate (Euro Interbank offered rate) and will result in a reduction.

However, the IFA said the time lag for this to benefit farmers must be minimised by all banking institutions.

IFA farm business chair Bill O’Keeffe said: “On the back of falling ECB interest rates, financial markets have seen a falling Euribor rate which is key in determining the cost of funds for Irish banks lending to Irish farmers.”

Cost of production

There has been an average 57% income drop across all farming sectors in 2023, as reported in the Teagasc national farm survey (NFS) 2023.

Higher costs of production reported in the Teagasc NFS have remained the underlying reason for tight cashflow and squeezed margins on many farms throughout 2024, according to the IFA.

“If your lender is not matching a competitive rate that is available elsewhere, consider moving your business in consultation with your accountant,” added O’Keeffe.

“Farmers need every support they can receive right now after a difficult 18 months of poor weather, poor grass growth and higher costs of inputs and services.”