Relative to 2016 many farming sectors are expected to increase their margins and farming family income is predicted to rise by 5% for 2017 however this comes in the face of notable exceptions which will experience a drop; beef and pigs and sheep.
The report surmised that Irish beef prices will continue to decline significantly in 2017 due to strong supplies across the EU and the weakness of Brexit sterling. Cost of production for beef is forecast to remain largely stable.
- EU beef supplies are set to rise for 2017
- Global beef markets are expected to weaken
- Brexit and depreciation of the sterling has created a huge challenge for the Irish beef industry
- The forecast for Irish finished cattle prices is a 12 % reduction in 2017
Sheep farmers saw their margins increase in 2016 and the emergence of new markets also helped however the report predicts that sheep will take a drop of 5% in 2017 with production costs forecast to rise. The sheep welfare payment may help the industry.
- Outlook for Irish and EU lamb prices for 2017 are negative
- Tight global supplies of mutton and lamb are forecast for 2017 due to contraction in New Zealand production
- Exchange rates, Brexit and lower beef price will affect overall Irish lamb price
Pig meat prices are forecast to fall slightly in 2017. The drop thankfully is seen to be a smaller one than that of beef farmers.
- Bumper harvests in 2014-16 has lead to build up of grain feeds for pigs, leading to an increased number of pigs
- Overall EU increase of pigs will lead to higher volumes on the market and lower overall prices
- China and Africa may play a role in pig prices in 2017
As expected the global outlook is not good with a mixed economic picture caused by two surprise elections in 2016 (US & UK), a week sterling and Brexit will continue to feature in 2017 while other best prospects for Irish output is in new and emerging markets such as Asia and the Middle East.
You can read the full report here.