A Teagasc report has shown a stunning 56% of tillage farms earned a positive margin in 2024 - meaning that the other 44% of farms did not return a margin or were at a loss.

Teagasc brought out its Outlook Report for 2025 last week. In that report, economist Fiona Thorne reported that there was a €200/ha increase in net margin on tillage farms, but only 56% of tillage farms earned a positive net margin in 2024.

The average net margin on farms was -€10/ha, but the range was -€715/ha to +€575/ha.

In 2025, Fiona predicts a 5% decline in fertiliser costs, a 2% increase in crop protection costs and no change in seed or machinery hire costs.

The report stated that there is a probability that grain prices for harvest 2025 would increase by approximately 5%, but there are a lot of uncertainties around that price at present.

Looking ahead to 2025, Fiona predicted an average net margin of €200/ha on tillage farms.

Breaking this down, she predicted that the gross margin per hectare on spring barley would increase by €85/ha and the gross margin on winter wheat would increase by €320/ha and by €200/ha on winter barley.

She explained that this results in an average cereal-based net margin being negative on 30% of farms in 2025.

Costs and returns

Given those figures, it is essential that all farmers do their costs and returns estimates, look at land rental prices and look for opportunities for premium crops to increase their profits.

This time of the year is ideal for this job ahead of the spring planting season.

The figures show the serious challenges that face tillage farmers in this country at present. The government has a target to increase tillage area to 400,000ha, an increase of over 50,000ha. However, if farmers are losing money on tillage farms, then this is unlikely to happen.

The €100/ha (€40/ac) payment due from Government will be welcome, but is not going to bring incomes up to a sustainable level.

Support

More needs to be done by the incoming government. There is a Food Vision tillage report with 28 actions.

The first two actions on that report need to be acted on and will provide security on income:

1. Introduce a tillage expansion and sustainability scheme: the group recommends replacing the Tillage Incentive Scheme (TIS) with a tillage expansion and sustainability scheme that provides a longer-term support and with an environmental focus that improves the sustainability of the sector.

2. Put in place an immediate financial support package for the sector for the 2024 growing season: in recognition of the current significant challenges facing the sector and to prevent a loss in tillage area, an immediate financial package must be put in place to support growers for the 2024 growing season.

3. Examine existing supports for tillage farmers, including young farmers.

4. Develop industry led initiatives that support the economic and environmental sustainability of tillage growers.

Action nine in the report is to: “Drive the preferential use of Irish feed grain and protein and exploit opportunities for value-added Irish feed.”

This could help to increase profitability by promoting Irish grain.