Crop Costs and Returns 2005

REPS for tillage farmers

REPS may add a further €150/hectare to the margins in the tables. REPS will play a vital role in maintaining the viability of medium and small scale tillage farmers. REPS constraints on straw burning, P utilisation and the uncultivated field margin will not cause a problem for tillage farmers. However, the restriction on N application will need to be considered.

At an early stage a cost benefit analysis for each farm will be needed. The scale of operation will have a major influence on the outcome. A financial assessment is essential but quality of lifestyle considerations should not be ignored. Crop choice is also important as some crops, e.g. spring barley, are more suitable than others to the REPS regime.

Crop Margins

Awareness of crop margins is now vitally important since under the new decoupled regime the Single Farm Payment (SFP)[formerly area aid and livestock premia] will be paid irrespective of what crop is grown (only potatoes and horticultural crops are not eligible to draw down the SFP). Moreover, it makes no sense to produce the crop at a loss. The bottom line is that the land must be maintained in “good agricultural and environmental condition”.

Note: The margins shown here do not include the SFP. This means that comparisons with previous versions of this leaflet are not valid as formerly area aid was included in the margins.

The margins given here should provide a useful guide but land suitability, rotation, risk avoidance and convenience should also be considered. There is little difference in margins between spring and winter cereals. Bonuses for quality are important.

In the case of malting barley and sugar beet, the availability of contracts and fulfilment of contract requirements may limit the attainment of these margins.

Potatoes have been included for the first time.

Stacking (consolidation) is a provision where Irish farmers can get their full Single Farm Payment without the need to farm all the land they farmed in the reference years 2000-2002. Farmers must farm at least 50% of the area they farmed in the reference years. Farmers can only stack if they dropped rented or leased land, afforested land since 2000 or lost land due to compulsory acquisition for public good (CPO). Stacking applies to all farming enterprises. As over ½ of arable land farmed is on rented ground this provision has major implications for the price of rented land for tillage.

Stacking may be availed of any year up to 2012 but 2005 will be the most appropriate for many as the stacked grower will in future be able to claim his full Single Payment on the reduced area. In future years the stacked grower may rent additional land (if profitable) without compromising his stacked (consolidated) entitlements.

Comment on Forage Crop Costs

Grazed Grass is likely to continue to be the cheapest fodder at about €75/tonne DM utilised. It has the advantage of producing very good yields in most locations and of course is extremely convenient to produce and utilise.

Grass Silage: First cut grass silage can be produced at reasonable costs - approximately €85/tonne DM utilised. Grass silage costs vary considerably depending on yields. Second and third cut silage are expensive forms of fodder (circa €140/t) where machinery has to be hired. Moreover, the variability in yield and quality of second and third cut silage has forced many farmers to consider alternatives such as maize, whole crop wheat and fodder beet.

Non Grass Silage: The cost per tonne dry matter of silage produced is estimated at €93 for arable silage, €80 for Whole Crop Wheat and €68 for Maize. Fodder Beet roots are estimated to cost €95/tonne DM utilised.

Production from Brassicas such as swedes, kale and rape will not match the main fodder crops. Rape and kale have a reasonable cost at about €90 per tonne of DM utilised. Production from swedes can be quite variable and costs are high.

Maize produces a high yield of quality feed at lower costs than second or third cut grass silage giving improved animal performance. It is convenient as sowing and harvesting are done by contractor. Feeding can be done with existing grass silage facilities. Moreover, there are no rotational constraints and it utilises slurry very efficiently.

Convenience of growing, storing and feeding as well as animal performance are important considerations when deciding which fodder crop to grow.

Forage Crops 2005

Covering maize with plastic will cost an extra €250/ha but will increase DM yield by 4t/ha & improve quality.

Explanatory Notes - Cereal Crops