There has been no change to beef cattle farmers’ incomes in 2021, as the rising cost of inputs has cancelled out increased output values.
That is according to the Teagasc Outlook 2022, Economic Prospects for Agriculture publication, which the state agency published on Tuesday, December 7th, 2021.
According to Teagasc, in 2021, prices for prime finished cattle were 12% higher this year than average levels in 2020.
It reported that in 2021, prices for younger cattle were 8-9% higher relative to 2020. This led to an increase in output value on single suckling enterprises.
The report added that “large” increases in feed prices have contributed towards higher feed expenditures on cattle enterprises.
The output value on the average cattle finishing enterprise increased in 2021 due to higher beef prices.
Furthermore, the BEEP-S and BDGP continued to “contribute positively” to gross output on single-suckling farms.
Cattle farmers’ incomes
In 2021, the average gross margin per hectare earned on single suckling enterprises is estimated to be €483 per hectare, a 4% increase from last year’s level.
Also, in 2021, the average gross margin per hectare on cattle finishing enterprises is estimated to be €522/hectare. This equates to a 9% increase on the 2020 level.
“For both cattle enterprises, the bottom one-third of farms have no improvement in gross margin per hectare in 2021 relative to 2020.”
Along with reviewing the year in question, the state agency has also revealed its outlook for cattle farmers for 2022.
Irish beef sector in 2022
According to Teagasc economists, Irish beef prices in 2022 are forecast to be “equal” to 2021 levels.
Meanwhile, EU beef supply is forecast to decline in 2022. UK beef supply is forecast to be unchanged in 2022.
Furthermore, input expenditures in 2022 are forecast to increase on 2021 levels due to higher feed, fertiliser and energy prices.
Direct production costs on single suckling enterprises are forecast to jump by approximately 10%.
“Direct production costs on cattle finishing enterprises are forecast to increase by approximately 12%,” the state agency said.
Meanwhile, the average gross margin per hectare on single sucking enterprises is forecast to decrease by 22% to €377/hectare next year.
In 2022, the average gross margin per hectare on cattle finishing enterprises is forecast to fall by 10% to €469/hectare.