There is a “very strong demand for credit” across all farm sectors at the minute, according to AIB agri adviser Eamonn O’Reilly.
He said this is off the back of a “super year” for all farmers, with commodity prices reaching all-time highs.
“In relation to land purchase, we are still seeing very strong demand across all sectors be it both dairying and drystock, and a certain amount of new entrants to farming still coming into the market.
“Land prices remain strong and there’s strong demand there. We’ll be expecting the land market to be pretty dynamic for the foreseeable future.
“Since the supply restrictions came in with co-ops, we would have seen a lot less of the new entrants to dairying but there are still existing dairy farmers expanding and developing their facilities,” he said.
He added that AIB saw more stocking loan applications and increased overdraft utilisation earlier on in the year from tillage farmers as a result of the price of inputs.
Some farmers are talking about taking out loans to cover fertiliser prices, O’Reilly said, however he added that farmers aren’t actually putting applications in yet.
“They’re out there talking to the market to see what prices they can lock in at the moment.
“There’s such volatility in the market it’s very hard for farmers to be confident that they’re making the right decision and a lot of them have more or less put the decision on hold. But they have enquired and they are thinking about it.”
O’Reilly added that increased cashflow from the increase in output prices this year is being reflected in farmer clients’ current accounts.