Farm incomes move up in 2024

A new report, by economists at Teagasc, provides the latest estimates of average incomes for various farm types in 2024 and looks ahead to future prospects by forecasting farm incomes in 2025.

Irish agriculture faced a complex set of challenges in 2024 shaped mainly by periods of unfavourable weather. High winter and spring rainfall left pastures saturated, delaying the start to the grazing season. By contrast, the summer months were dry, but overcast, and this led to poor mid-season grass growth, which negatively affected Irish farms producing milk, cattle, and sheep. On the positive side, late season grazing conditions in October and November were exceptionally good.  On tillage farms, adverse weather during late 2023 and early 2024 resulted in a decline in winter cereal crops planted in 2023 and delayed planting in spring, 2024 respectively resulting in total production of cereals in 2024 remaining below the 5 year average.  Despite the poor weather and late planting, many crops yielded better than expected.

Turning to inputs, fertiliser prices fell considerably in 2024. While animal feed prices also decreased, feed volumes were up, mainly due to the adverse weather. Expenditure on fuel remained relativity stable, while electricity prices fell considerably.

The average farm income in 2024, is estimated to be up 49% to almost €29,200, but the increase is almost entirely driven by the increase in income experienced in the dairy and tillage sectors.

Dairy

For dairy farms, a delayed start to the grazing season was followed by poor-mid season grass growth, leaving milk production about 5% below normal by mid-year. However, with excellent late season grazing conditions, along with increased feed use, milk production is expected to down about 2% for the year as a whole. While it was a poor year for grass growth overall, dairy farms have seen a substantial income recovery in 2024, as higher milk prices, up 15% on the 2023 level, have driven a recovery in margins. The typical dairy margin should be over 13 cent per litre in 2024, an increase of over 6 cent per litre on the 2023 average. Taking account of the drop in milk production, the average dairy farm income in 2024 should be approximately €89,000, an increase of 80% relative to very low level recorded in 2023.

Cattle rearing and cattle other

For cattle rearing farms, incomes should show a modest increase in 2024. Averaging over the year, beef cattle prices were up slightly. There were also minor cost reductions, even though feed usage was higher due to poor grass production. Despite declining average cattle weights, higher cattle prices are expected to support an improvement in margins, though the sector’s income remains largely reliant on support payments. The average income on a cattle rearing farm in 2024 is estimated to be approximately €9,500, an increase of 28% on the extremely low 2023 level.

For the cattle other farm category (mainly finishers), finished cattle prices have shown seasonal fluctuation, but the annual average price in 2024 should be up 4% on the 2023 level. With the reduction in production costs, the average income for Cattle Other farms in 2024 is forecast to increase to approximately €17,000, an increase of 15% on the very low income figure reported in 2023.

Sheep

While sheep and lamb prices rose significantly in 2024, up by about 15% on the 2023 level due to tighter EU supplies, output volume per hectare is estimated to have declined by 10% in 2024 due to lower ewe numbers and weaning rates. However, with lower production costs and increased coupled direct payments, margins and income for sheep farms are estimated to have increased in 2024. The average income on a sheep farm is estimated to be approximately €15,000, an increase of 19% on the relatively low income level of 2023.

Tillage

Tillage farms endured another challenging production year in 2024, but the end outcome was not quite as bad as had been feared earlier in the year.  The estimated increase in incomes in 2024 is appreciable, but it still leaves the average tillage income well down on the five year average.  Delays in planting last autumn and winter led to a shift from winter to spring crops, resulting in an overall level of production which was below normal. Yields for spring crops were below the 5 year average but generally better than expected in 2024, while yields for winter crops were generally down.

Harvest prices for major cereals in 2024 were up only slightly on those at harvest 2023. With substantial reductions in fertiliser prices, cost savings were sufficient to allow a partial recovery in farm incomes in 2024, following on from the extremely low incomes recorded in 2023. Nevertheless tillage farms remain heavily reliant on support payments to maintain profitability. The average income on a tillage farm in 2024 is estimated to be approximately €30,000, an increase of 40% relative to 2023.

Pigs

Pig production was more profitable in 2024 and pig production increased by 3% in volume terms. Pig prices fell 2% relative to the 2023 level and a significant drop in feed prices in 2024 resulted in lower production costs. This has resulted in an increase in margins on pig farms, with an estimated margin over feed of 86 cent per kilogram (kg) for 2024.

Forestry 

In 2024, forestry planting levels are estimated to be under 2,000 hectares (ha). Timber prices in the forestry sector were generally at similar levels to those of 2023, reflecting challenging supply and demand conditions. In terms of forestry returns, using ten year average forestry timber prices, it is estimated that the Annualised Equivalent Values (AEV) for Forest Type 7 and 12 were €578 per ha and €740 per ha respectively.

Table 1: Farm System average income 2023, with estimate for 2024 and forecast for 2025

The Teagasc Outlook 2025, Economic Prospects for Agriculture, is available to view and download here.