Agriculture in Ireland
The Irish Agri-Food Industry
The agri-food sector in Ireland in 2015 generated 5.7% of gross value added (€13.54 billion), 9.8% of Ireland’s merchandise exports and provided 8.5% of national employment. When employment in inputs, processing and marketing is included, the agri-food sector accounts for almost 10% of employment.
Contribution of the Agri-Food Sector to the National Economy
The agri-food sector is one of Ireland's most important indigenous manufacturing sectors, accounting for employment of around 167,500 people. It includes almost 700 food and drinks firms throughout the country that export food and seafood to more than 160 countries worldwide. Economic activity in the agriculture and food sector produces a far bigger return than equivalent activity in other traded sectors of the economy. That is because agri-food companies source 74% of raw materials and services from Irish suppliers, compared to 43% for all manufacturing companies.
Data from the Central Statistics Office (CSO) indicates that the agri-food sector (including agriculture, food, drinks and tobacco) accounts for around 5.7% of GDP with primary agriculture, forestry and fishing accounting for around 1.8% of GDP.
|Contribution of the Agri-Food Sector to GVA in 2015||€m|
|Gross Domestic Product (GVA) at Factor Cost||236,234.5|
|GVA in Primary Agriculture, Fisheries and Forestry at Factor Cost||4,135.4|
|GVA in Food & Beverages Sector||9,217.6|
|GVA in Wood Processing||183.9|
|GVA in Primary Sector as a % of Total GVA||1.8%|
|GVA in overall Agri-Sector as a % of Total GVA||5.7%|
|Source: Eurostat National Accounts aggregates by industry nama_10_64|
Employment in the Agri-Food Sector
Composition of Employment in the Agri-Food sector, 2015
Source: CSO QNHS, Average for 2015
Agri-food exports account for almost 10% of total Irish merchandise exports. However, when the low import content of agriculture and food exports and the low repatriation of profits earned in the agri-food sector are taken into account, it is estimated that the agri-food sector accounted in 2008 for around 40% of net foreign earnings from merchandise exports.
Irish food and drink exports in 2016 grew last year by 2.2% and were valued at a record €11.4 billion. Since the period 2007-2009 the value of Irish agri-food exports has increased by over 39%.
Agri-Food Exports 2015-2016
|Ireland Agri-food Exports 2015-2016||GB + NI|
|All Destinations||GB + NI||% of Total|
|SITC Section (1 digit) and Division (2 digits)||2015||2016||2016||2016|
|0 Food and live animals||9,878||10,072||4,207||42%|
|00 Live animals other than animals of Division 03||431||340||259||76%|
|01 Meat & meat preparations||3,500||3,582||1,837||51%|
|02 Dairy products and birds' eggs||1,787||1,758||698||40%|
|03 Fish, crustaceans, molluscs and preparations thereof||568||556||64||12%|
|04 Cereals & cereal preparations||403||378||339||90%|
|05 Vegetables & fruit||287||278||239||86%|
|06 Sugars, sugar preparations & honey||162||211||44||21%|
|07 Coffee, tea, cocoa, spices & manufactures thereof||372||372||242||65%|
|08 Feeding stuff for animals (excl unmilled cereals)||296||281||212||75%|
|09 Miscellaneous edible products & preparations||2,073||2,316||272||12%|
|of which Infant food||1,169||1,285||135||11%|
|1 Beverages and tobacco|
|Total food and live animals and beverages||11,080||11,336||4,509||40%|
|Source: Eurostat COMEXT|
Land Use and Farm Structure
- Irish agriculture is primarily a grass-based industry.
- The Census of Agriculture 2013 showed there were 139,600 farms compared to 139,829 farms in the 2010 Census of Agriculture.
- The utilised agricultural area declined marginally since the 2010 Census of Agriculture to 4,949,500 hectares. The average size of agricultural holding also decreased marginally to 32.5 ha.
- Approximately 81% (3.69 million ha) of agricultural area is devoted to grass (silage, hay and pasture), 9% (0.45 million ha) is in rough grazing and the remainder circa 9% (0.39 million ha) is allocated to crop production.
- There are approximately 139,600 family farms in Ireland with an average size of 35.5 hectares per holding according to the Farm Structure Survey of 2013.
Number of farms and utilised agricultural area, Farm Structure Survey 2013
|Number of farms and utilised agricultural area in 2010 and 2013|
|Number of farms||139,860||139,600||-0.2|
|Utilised agricultural area excluding commonage (hectares)||4,994,353||4,959,500||-0.7|
|Average farm size (hectares)||7||5||-0.6|
Main Commodities Output and Exports
Output, Input and Income in Agriculture, 2016
The CSO currently estimates that the operating surplus in agriculture in 2016 increased by €88m or 3.5% on 2015. This increase was largely due to an increase in the value of net subsidy receipts and somewhat lower expenditure on inputs. Goods output at producer declined in 2016 by 2.9%.
Comparing 2016 with 2015 we see that the goods output at producer prices declined, the component items and changes relative to 2015 were:
- Goods output at producer prices: -2.9% or -€205m
- Milk output: -6.2% or -€117m
- Cattle output: -2.1% or -€51m
- Pigs output: 0.8% or €4
- Sheep output: -1.8% or €4m
- Cereals output: -11% or €30m
- Total intermediate consumption: -1.6% or- €82m
- Fertilisers: -11% or €63m.
The value of subsidies less taxes on production increased by almost 17%, from €1,319m in 2015 to €1,541m in 2016.
- The contribution of Primary Agriculture to the Irish economy in 2010, at 1.8% of GDP, is close to the EU average.
- Beef and Cattle production dominate the Irish agricultural economy. Milk and beef output accounted for around 58% of agricultural output at farm gate prices in 2016.
In terms of the destination of Irish food and drink exports in 2016, the United Kingdom at around 41% remained the principal market with sales of just over €4.5 billion. Continental EU markets account for 31% of food and drink exports with a combined value in excess of €3.4 billion.
- Ireland in 2015 net exports of beef accounted for 85% of production, making Ireland the largest beef net exporter in the EU and fifth largest in the world. In terms of total beef production the domestic market consumes approximately 15% of production.
Cattle and Beef
- There were 7.2 million cattle in Ireland according to the June livestock survey on the 30th June 2016, this represents a 4% increase on the 2015 level.
- Irish beef production is predominately a grass based system, with 588,400 tonnes produced in 2016.
- In 2015, Ireland exported an estimated 564,000 tonnes of beef worth approximately €1.6 billion.
- In 2015, 181,000 cattle were exported live from Ireland worth approximately €114 million.
Sheep and Sheep meat
- For 2016, the June livestock survey indicates that the Irish sheep flock increased by 0.7% to 5.2 million head, with the breeding flock increasing by 0.8% to 2.58 million head.
- During 2015, Ireland exported an estimated 48,000 tonnes of sheep meat which was valued at approximately €230 million.
- France is the main market for Irish sheep meat exports, accounting for approximately 35 per cent of total export value in 2015. The UK is also a substantial export market, accounting for 21% of the value of exports.
Pigs and Pig meat
- In the June 2016 CSO Livestock Survey there were 1.59 million pigs in Ireland, this represents an increase of almost 4% on 2015 levels.
- In 2015, Ireland exported an estimated 209,000 tonnes worth approximately €381 million.
- In 2015, the UK was the main market for Irish pig meat accounting for 45% of our total exports value. Continental EU markets accounted for 21% of Irish pig meat exports while the remaining 34% went to international markets.
- In 2016, total milk output (incl. imports) was estimated at 7,480 million litres.
- From this total milk output, 526 million litres was consumed as liquid milk. In addition to this 199,000 tonnes of butter were produced in 2016.
- In 2016, total dairy exports declined by 1.6% to €1.76 billion.
Agri-Food Sector contribution to the Irish Economy
The agri-food sector makes a very significant contribution the Irish economy. The Annual Business Survey of Economic Impact (ABSEI) for 2015, conducted by Department of Jobs, Enterprise and Innovation, provides aggregated estimates for all Irish-owned and foreign-owned firms across a range of variables. As part of this survey, Forfás collates data on Irish Economic Expenditure (IEE), taken to consist of wages, Irish raw materials and Irish services. An analysis of expenditures by companies operating in Ireland highlights the close ties the FD sector in Ireland retains with the national economy in terms of IEE as compared to manufacturing in general.
Irish Economic Expenditure accounts for 69% of total expenditure in the FD sector. This compares favourably to the manufacturing sector when taken as a whole, where the equivalent rate of IEE is 44%.
National Farm Survey 2015
In 2015 898 farms participated in the Teagasc National Farm Survey (NFS), these farms are weighted to represent a national population of approximately 84,259 farms. Overall 2015 was a moderately good year for farming with average farm income up 5%on 2014. Average family farm income in 2015 is estimated at €26,303.
- In 2015 the average value of gross output was stable despite a 9% decline in direct payment receipts. The stability of gross output value was due largely to improvements in drystock prices.
- Overall farm systems input expenditure decreased by more than 2% due to good grass growing conditions, lower feed use, and lower input prices.
- Farming in 2015 continued to be very reliant on subsidies, subsidies accounted for 65% of family farm income on average in 2015.
- Despite the ongoing recovery in the Irish economy and labour market the number of farm households where the farmer and/or the spouse had an off-farm income was stable in 2015 at just under 50%.
Overview of the dairy farm system
There were approximately 15,588 Dairy farms with an average income of €62,141 in 2015, a 6 percent decrease on 2014.Gross output on dairy farms decreased due to milk prices that declined by 20% compared to 2014. The strong expansion in the volume of output following the ending of the quota system mitigated the impact of lower milk prices on output value, with output value down by 3%.
Figure 8. Components of family farm income on dairy farms 2014 & 2015
Overview of the cattle rearing system
There were approximately 19,717 cattle rearing farms represented in the NFS in 2015, suckler cow production is the dominant system on these farms.
Higher store and cull cow prices, up 6% and 16% respectively, contributed to a 5% increase in farm gross output. The value of direct payments on Cattle Rearing farms was down 10 percent, mostly due to the cessation of REPS and due to the withholding of 3% of the Basic Payment to be paid later in 2016.
Lower animal feed prices and good weather conditions contributed to the 7 percent reduction in direct costs, while lower energy and fuel prices led to the reduction in overhead costs. Overall, average income increased by 31%, but it is important to put this in the context of the typically low average incomes in this system of farming.
Figure 9. Components of family farm income on Cattle Rearing farms 2014 & 2015
Overview of the cattle other system
There were approximately 25,783 Cattle Other farms, with an average income of €16,319 in 2015, a 30% increase on 2014. Cattle fattening is the dominant enterprise on these farms. While a 30% increase seems considerable, it should be viewed in the context of the quite low average incomes that prevail in this farm system.
On the back of strong finished cattle prices, up 16% in 2015, farm gross output increased by 6%. The value of direct payments was down 8% following the conclusion of REPS and the withholding of 3% of the Basic Payment. Input expenditure was down due to lower animal feed, energy and fuel prices and the volume of purchased feed used was down due to good grass growth.
Figure 10. Components of family farm income on cattle other farms 2014 & 2015
Overview of the sheep farm system
There were approximately 12,723 Sheep farms with an average income of €16,137 in 2015, a 10 percent increase on 2014.
Total farm gross output increased by 5 percent on Sheep farms, despite a 4 percent reduction in direct payments. Lamb prices increased by 2 percent in 2015 and the average flock size was more or less unchanged. The gain in gross output value was largely driven by higher cattle prices. Input expenditure on Sheep farms did not decline as it did on cattle farms and as a result, average farm income on Sheep farms increased by just 10% in 2015.
Figure 11. Components of family farm income on sheep farms 2014 & 2015
Overview of the tillage system
There were approximately 5,056 Tillage farms with an average income of €34,303 in 2015, an 18 percent increase on 2014.
Gross output value on Tillage farms increased by 2 percent from 2014 to 2015, while direct payments decreased by 8 percent. Cattle gross output increased significantly on Tillage farms, up approximately 16%, but the output of crops fell by 3%. Overhead costs declined more significantly on Tillage farms than the other farm systems, as expenditure on fuel, a relatively important input for Tillage farms, fell by 26%.
Figure 12. Components of family farm income on Tillage farms 2014 & 2015