Farm incomes only 73% of average industrial wage, says Teagasc

IRELAND - Farm incomes increased on average by 44.4 per cent in 2005 to €22,459 per farm, according to the Teagasc National Farm Survey. Average Family Farm Income was €15,557 in 2004.
calendar icon 19 September 2006
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Once-off Premium Boost to 2005 Farm Incomes

The increase in farm incomes in 2005 resulted from the change in EU policy to a decoupled premium system. This led to a once-off gain, and incomes will decline to more traditional levels in 2006.

The survey, conducted by Teagasc Rural Economy Research Centre, revealed that the income generated from the market place actually declined last year. The average income farmers received from the market place, excluding direct payments, was only €1,360, (6% of farm income) in 2005. That is a decline of 32 per cent compared to the market income of €2,010 in 2004. On full-time farms, the portion of farm income generated from the market was €8,759 on average.

Commenting on the results, Liam Connolly, Head of the National Farm Survey team said: “2005 will be remembered as the most unusual year since the National Farm Survey commenced in 1972.”

In 2005 farmers received an average once-off payment of €5,266 per farm in arrears from the coupled 2004 premium system, plus their 100 per cent entitlements under the Single Payment Scheme. This had a huge impact especially on drystock and cereal farms. Were it not for payment of these arrears, the increase in farm incomes would have been 10.4 per cent in 2005.

It is a reflection of the low incomes in agriculture that in a year where income increased by 44.4 per cent the average farm income was still only 73 per cent of the average industrial wage,” he said

The trend towards part time farming continues with the highest level of off farm employment occurring on drystock systems. The survey shows that on 55 per cent of all farms, the farmer and/or spouse had an off-farm job, compared with 52 per cent in 2004.

The full-time farms are mainly involved in dairy and tillage farming. Accounting for 38 per cent of all farms (or 42,000) they had an average farm income of €40,480.

Just under a quarter of all farms had an income of less that €6,500, but on nearly all of these farms the farmer and/or spouse had some other source of income.

Other key findings of the survey include

  • Dairy farms still yield the highest returns
  • Direct payments comprised on average 94 per cent of family farm income
  • Overall, on 81 per cent of farms, the farmer and/or spouse had some other source of income, be it from employment, pension or social assistance
  • 78 per cent of farms in REPS are in the three drystock systems
  • Less than 20 per cent of farms are dependent solely on farming for their livelihood
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