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Minister Coughlan Welcomes a Favourable Year for Irish Farming

The Minister for Agriculture, Fisheries and Food, Mary Coughlan TD, today at her End of Year Review spoke of 2007 as being a favourable year for Irish farming. This was underpinned by the announcement by the CSO that farm incomes rose by 7.3% to €2,510 million in 2007. The Minister said that "the rise in aggregate farm income was due to a rise in combination of positive trading conditions for the dairy commodity markets, a large increase in the output value of cereals and a maintenance of direct payment to farmers in 2007 by my Department''. Total direct payments amounted to over €1.85 billion, which included over €1 billion under the Single Payment Scheme.

The gross value of the dairy sector rose by €302 million to €1,629 million, an increase of 23% on 2006. The outlook for the sector remains strong with international prices expected to remain firm particularly in the early part of 2008. There was a small decline in the output value of beef markets (-2.6%) reflecting marginal reductions in output prices. There was also a very small reduction in the output value of the sheep sector (-1.5%) largely reflecting a reduction in throughput following increased ewe slaughterings in recent years.

There was a more substantial decline in the output value of the pig sector (-9%) reflecting reduced prices as well as throughput. Producer prices were down by approximately 5% on 2006.

Minister Coughlan said that despite concerns about the impact of the difficult weather conditions during summer 2007 the output value of cereals is estimated to have risen by 73% to €277 million. The volume of production increased marginally while prices rose rapidly in response to reduced supplies on international markets and increasing global demand.

Naturally, the rise in cereal prices also had on impact on feed costs, which are estimated to have risen by almost 6%, accounting for approximately one-quarter of intermediate consumption. There was a 5% decrease in the cost of fertilisers with usage declining by approximately 8%. Energy costs were up by over 5%. Overall intermediate consumption increased by 3%

The Minister said that ''the outlook for 2008 is positive, with continued strength expected on dairy and cereals markets and some tightening of meat supplies next year could result in a favourable market impact''.

"The rise in income this year provides a positive message both for our farming families, and for the future of the sector,"
the Minister added.

7 December 2007

Date Released: 07 December 2007