Some business plans submitted to banks by dairy farmers contain unrealistic projected milk prices, according to Anne Marie Butler from Ulster Bank.

Speaking at an Ulster Bank event at Innishannon, Co Cork, on Friday, the bank’s agri manager said: “We’re working on a base price of 28c/l and then we’ll add to that the fat and protein based on your co-op or ICBF statement. Unfortunately, we would still get business plans that include milk prices at maybe 40c/l or 45c/l. That is not a realistic assumption.”

She advised those completing business plans to look at the realistic costs of family farming. “Include drawings that accurately reflect the costs of family life. Education costs are very important and are rarely factored into most business plans,” Butler said.

Cost of living

“One of my big learning curves over the years has been the cost of living for farmers. If someone is borrowing for 15 or 20 years, it’s not realistic to put in levels of drawings for children of a smaller age. You have to allow for third-level education,” she added.

Referring to farm costs, Butler said accurate figures need to include land rental and labour costs. “Today’s conference focused on trying to attract good labour. Is your farm a good place to work and are you a good person to work for? Those are key in attracting labour, but you also have to allow for paying for that labour,” she said.

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