This week, Teagasc announced an update on their 2025 forecast for income on Irish farms. Every year in early December, the Teagasc economists announce a forecast for the year ahead.

They can’t predict the weather, so for their forecasts they assume a normal weather pattern. For the first time in a good number of years, the ‘normal’ 2025 weather pattern actually materialised. Grass growth and grazing conditions mirrored what you might expect.

The ‘normal average’ weather myth is busted by the fact that for some farmers in the east it was and still is too dry, and heavy feeding has been and is a real issue right now. That aside, the fact that the weather was good means overall the Teagasc economists got the trend right last December. However, this week’s updated Teagasc forecasts show how much the economists under-played the upward margins.

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In December, dairy farm incomes were forecast at €113,000 and now the updated number is €140,000 – that’s a 24% lift on what was expected. Cattle rearing and ‘cattle other’ farms were expected at €10,500 and €18,500 respectively in December. This week, the update lifts that to €25,000 and €26,000 respectively. That’s a 140% and 40% increase on the original December forecast.

In fairness, not many saw the scale of the surge in beef prices coming. When the Teagasc number crunchers were forecasting beef prices in the last week of November 2024, the R=3+ price average from the factory sheets was €5.53/kg.

That same price rose to €5.80/kg in the last week of December, €6.22/kg in January, €6.80/kg in February, €7.48/kg in March and €7.95/kg in April. That’s €2.40/kg of a rise or almost 50% increase in output price. Should the Teagasc economists have seen that coming?

Stock numbers in cattle and sheep are in freefall. Farmers are voting not to breed and to reduce stock. This exodus is either forced by policy or long-term decision making by farmers.

Darren Carty tells me the most alarming figure on the sheep side is that in the space of two years, the lamb kill has dropped by 500,000. That’s a 20% fall in two years. If that fall off continued, in ten years there wouldn’t be a sheep flock in Ireland.

Ten year suckler cow numbers continue the downward slide with 200,000 less cows. In addition, the big transition in the cattle herd has been the shift out of continental genetics into Angus and Hereford genetics from dairy cows.

If there are 200,000 less suckler cows and 500,000 more dairy cows on balance, let’s assume one cancels out the other in terms of meat output at the factory floor – zero gain.

However, 250,000 less Charolais and Limousin cattle on farms over the last 10 years means less meat. Assuming a 70kg lighter carcase from each of the 250,000 heads means less farmers, less factories and lower sales.

So looking back, what have been the big policy pushes by our recent ministers – ‘organics’ which means less stock, a green ‘environmental scheme’ push which means less stock, a push on alternatives like ‘anaerobic digestion’ which means less stock, and ‘forestry’ which means no stock. All of these in addition to a declining support payment in real terms.

On Monday, Minister Martin Heydon took to the national airwaves representing the Government to put a positive spin on the new 15% EU and US tariff agreement in principle. His positivity was centred on the fact that it removed uncertainty.

Last week, in this publication the minister talked about the positive side of having 80% of current farm support ring-fenced in CAP 2028.

Investment in farming and food production is a long-term play. Short-term prices won’t fix long-term policy. Whatever about uncertainty in business on a national scale, we badly need a fix on the flux and uncertainty in the food and farming world exemplified by the nitrates derogation uncertainty for all sectors.

The statistics above show farmers are being forced to walk away from producing food. Our grain merchants, our milk and beef factories won’t be able to stay going – the farmer ultimately carries this cost also. We need to keep it real and realise Irish farming is changing very fast.