JANUARY 2020 www.irishfarmersmonthly.com Feature would be in some doubt. As estimated by the Teagasc economists, gross margins on single suckling farms will remain extremely problematic in 2020. Maybe the cream will rise in 2020 Milk prices are expected to be stable over the coming twelve months. After slippage in the back-end of 2019, market indications suggest a price recovery next year. Whether any anticipated price increases will be enough to put price above the 2019 average remains to be seen, but there are reasons to be positive in that regard. In any case, Teagasc is predicting an increase in dairy farm incomes in 2020 based on increased output and reductions in production costs, most notably feed and fertiliser. The term ‘running to stand still’ comes to mind but at least that opportunity is still there for many producers, either through higher milk solids and yields or more cows, or all three. A leg-up for lamb producers The Teagasc positivity around sheep enterprises is worth quoting directly: “The outlook for Irish and EU lamb prices for 2020 is stable, with global sheep meat prices projected to remain high”. Teagasc expects sheep enterprise gross margins to lift by around seven percent for 2020 to an average of €636 per hectare. There is a longer-term health warning attached, with a prediction from the OECD-FAO Outlook that forecasts real prices for sheep meat to decline in the coming two years to their 2017 levels. The seismic reduction in pork meat volumes in China may again positively influence sheep meat prices during 2020 and beyond. Current high demand and improved prices for sheep meat do nothing to diminish that optimism. High yields and low prices Tillage farmers leave 2019 with little regret. While grain NFS Family Farm Income 2017, 2018, 2019e & 202f 100 year, suffering a two percent decrease. No one would thank Teagasc for engaging in over-optimistic estimations of prices or farm income. However, these price estimates for cattle production in general would seem a little too conservative. There is a meat protein deficit in the global market at present, most notably driven by Chinese demand. Should that continue through 2020 then there is some reason to be optimistic that beef prices will be better than estimated by Teagasc. Granted, the price drops suffered across last year will take a lot of recovering but EU beef supplies are in decline and the British market will remain fully open at least for the next twelve months. If the minimal price increases delivered by the processors in December are built on in the coming months then a rising tide should lift all boats with calf, weanling and store prices all benefiting from a more buoyant beef trade. There are a lot of assumptions involved but any further decrease in margins, especially in relation to cattle finishing is a very stark scenario. If it had not been for the introduction of the BEAM and BEEP schemes during 2019, the long-term viability of many of those enterprises n 2017 n 2018 n 2019 n 2020 80 60 €’000 40 20 0 Dairy Cattle rearing Cattle other Sheep Tillage Average 15