Feature JANUARY 2020 www.irishfarmersmonthly.com Mixed forecast for farm incomes in 2020 Forecasting the weather is difficult enough. Forecasting farm incomes is possibly even more hazardous, especially if the forecast is estimating a full year ahead. The Teagasc Annual Review and Outlook for 2020 tried to do just that. Matt O’Keeffe reports There are a few near certainties included in the estimates, most prominently EU payments to the different enterprises. With any new version of the Common Agricultural Policy now pushed out until at least 2021, there will be no major changes in payments to Irish farmers in 2020. Unfortunately, the outlook for EU payments after that is not positive. With Britain leaving the EU, there will be a hole in the EU Budget that is unlikely to be filled. Major contributor countries to the EU Budget seem adamant that there will be little or no increase in contributions, and certainly not enough to make up for the shortfall in British funding. The 2021-2027 EU Budget is currently expected to allocate €232 billion for direct farm supports. That’s a cut of €30 billion on the outgoing budget. Add in an ongoing payments convergence policy and individual Irish farmer receipts can only go in one direction. The new Agriculture Commissioner is said to favour even faster implementation of external convergence of EU payments which could result in even higher than anticipated reductions to Irish farmers when the new CAP is eventually implemented. The Polish-born Commissioner Wojciechowski is surely reflecting on the fact that his own farmers receive average payments of €258/ha, a lot less than the average €325/ha paid to Irish farmers. Market income estimates Meanwhile the battle to get more from the marketplace continues. Teagasc is reasonably optimistic that market prices across the enterprises will improve in 2020. In some instances, the research and advisory body may be taking a somewhat conservative view. (There is a weather warning with all these predictions and that assumes ‘normal’ weather conditions through 2020). As the enterprise that is present on upwards of 80,000 Irish farms, income predictions for cattle farming are hugely important. Here, Teagasc adopts a conservative approach with prices for finished cattle predicted to move upwards by four percent across the coming year. The estimate for weanling and store producers is a marginal price increase of two percent, while cattle finishing gross margins per hectare will be under further pressure next 14