The President of ICMSA has cited figures released today by the Central Statistics Office (CSO) as confirmation of what farmers already strongly suspected from their own accounts and enterprises. Pat McCormack said that the statistics just published proved beyond doubt that the state’s farmers are being caught again in the ‘costs-price squeeze’ that sees input costs surging while the output prices received fall or at best remain constant. He pointed out that in those years when the prices farmers received ran ahead of input inflation, farmers could just about deal with the steady erosion of their margins through rising input costs but in situations such as we’ve had for the last 18-odd months, where milk prices were low and under pressure and farmer beef prices were being hammered by the factories, then Mr McCormack said that input inflation quickly emerged as a major negative factor that transformed already very tight ‘breakeven’ situations into losses and pushed more and more farmers into cross-subsidisation where their direct payments were eaten up by bills.
“The first thing we notice is that the Agricultural Input Index increased by 6.3% from December 2017 to December 2018 while the corresponding Agricultural Output Price Index was down by 3.1% over the same period. Milk price – that is, the price paid to farmers as opposed to the price paid by consumers – was down by in excess of 10% in that period, but if we look across to the inputs paid by those same milk producers, we see energy costs up 5.4%, while fertilisers are up overall by 9.7% and veterinary costs up by over 3.1%. Feedstuffs alone went up overall by 10.8%. In the context of output prices being under pressure, this is very significant input inflation at a time when we’re constantly told about low inflation – property costs aside – and relatively low interest rates. This is the problem that ICMSA has highlighted again and again: while farmer prices either remain constant, see-saw or even fall significantly; our inputs costs only ever go in one direction and that’s upwards at a continuous and constant rate. Over any set period, the record shows that net farmer incomes are being eaten into year-on-year by the Government’s inability or unwillingness to face up to the reasons behind this inexorable rise in farm input costs and some of the very well financed and influential groups that seem to be able to increase their own prices without any objection being voiced by anyone except the farmers paying”, said the ICMSA President.
“It’s very simple, if farming as we know it is to continue then output prices are going to have to increase at a higher rate than input prices and it’s simply not good enough to tell farmers that they should be happy with output prices they received ten or twenty years ago when their input costs are rising at the rate the Government’s own CSO figures confirm”, concluded Mr. McCormack.
Pat McCormack, 087-7608958
President, ICMSA.
Or
Cathal MacCarthy, 087-6168758
ICMSA Press Office
