Milk and cereals were the two agricultural products that saw the largest decrease in value in 2023, with milk down 30% and cereals by 52%.
Increases in the value of pigs (+7%), poultry (+8%), and potatoes (+30%) helped to limit some regions’ exposure to the full impact of the fall in milk and cereal values on their agricultural income.
The South-East (Carlow, Kilkenny, Waterford, and Wexford), which produces 30% of Irish cereals and 19% of Irish milk, and Mid-West (Clare, Limerick, and Tipperary), the second largest producer of milk, experienced the biggest falls in agricultural income, with Operating Surpluses down more than 48%, and Entrepreneurial Incomes contracting by over 60%.
The West (Galway, Mayo, and Roscommon), which has the lowest dependency on milk for its income, had the smallest reduction in agricultural income, with its Operating Surplus down by 17% (-€87m) and Entrepreneurial Income by 19% (-€89m).
The South-West (Cork and Kerry), the largest milk producing region in the country, saw its Operating Surplus fall by 46% (-€526m) to €624m and Entrepreneurial Income by 55% (-€546m) to €456m.
The Border region (Cavan, Donegal, Leitrim, Monaghan, and Sligo), the largest pig and poultry producer in the country, experienced the second smallest fall in agricultural income, with its Operating Surplus declining by 17% (-€86m) and its Entrepreneurial Income decreasing by 22% (-€98m).
Operating Surplus in the Dublin & Mid-East region (Dublin, Kildare, Louth, Meath, and Wicklow), which is the State’s largest producer of crops, fell by 39% (-€243m) and its Entrepreneurial Income contracted by 50% (-€277m).
The Midland region (Laois, Longford, Offaly, and Westmeath), the second smallest agricultural producing region, saw its Operating Surplus drop by 39% (-€128m) and its Entrepreneurial Income contract by 54% (-€146m).
| Table 1.1: Output, Input and Income in Agriculture by NUTS 3 Regions, 2020-2023 | €m | ||||||||||||||||||
| Goods Output | Intermediate Consumption | Net Subsidies | Operating Surplus | ||||||||||||||||
| 2020 | 2021 | 2022 | 2023 | 2020 | 2021 | 2022 | 2023 | 2020 | 2021 | 2022 | 2023 | 2020 | 2021 | 2022 | 2023 | ||||
| Border | 1,093 | 1,179 | 1,432 | 1,340 | 798 | 852 | 1,068 | 1,026 | 290 | 282 | 313 | 283 | 426 | 420 | 495 | 409 | |||
| West | 788 | 874 | 1,052 | 969 | 582 | 671 | 802 | 756 | 346 | 335 | 365 | 336 | 445 | 428 | 520 | 434 | |||
| Mid-West | 1,423 | 1,630 | 2,100 | 1,821 | 960 | 1,075 | 1,331 | 1,387 | 273 | 267 | 304 | 249 | 571 | 618 | 877 | 452 | |||
| South-East | 1,390 | 1,612 | 2,099 | 1,783 | 862 | 965 | 1,240 | 1,232 | 207 | 202 | 238 | 181 | 488 | 570 | 796 | 401 | |||
| South-West | 1,746 | 2,055 | 2,719 | 2,204 | 1,071 | 1,206 | 1,633 | 1,595 | 313 | 307 | 352 | 286 | 744 | 933 | 1,150 | 624 | |||
| Dublin & Mid-East | 1,110 | 1,326 | 1,654 | 1,439 | 680 | 765 | 952 | 939 | 170 | 168 | 199 | 155 | 366 | 469 | 628 | 385 | |||
| Midland | 852 | 954 | 1,256 | 1,115 | 631 | 668 | 854 | 819 | 167 | 159 | 181 | 150 | 185 | 210 | 329 | 202 | |||
| State | 8,403 | 9,629 | 12,312 | 10,670 | 5,583 | 6,203 | 7,880 | 7,754 | 1,766 | 1,720 | 1,952 | 1,640 | 3,225 | 3,647 | 4,795 | 2,907 | |||
The value of Agricultural Output at Basic Prices decreased by 13% (-€1.6bn) to €11.3bn in 2023, with milk accounting for €1.5bn of this reduction. While there was almost no change (+€7m) in overall livestock values, pig production was up €46m (+7%) as higher prices (+19%) more than countered lower volumes (-10%). Poultry was worth an additional €17m (+8%) to the sector, with half of that increase due to stronger prices. A rise of 3% in cattle prices was offset by lower volumes (-4%), causing values to decrease by €13m. Sheep fell by €33m (-9%) due to the impact of lower prices (-3%) and volumes (-6%). With prices down by 4% and marginally higher volumes, the value of horses contracted by €10m (-3%).
The price of milk fell by 26% in 2023, and with volumes also lower, its value fell by €1.5bn (-30%). Crops decreased by €165m (-6%) to €2.5bn. Forage plants were up €160m (+12%), although it should be noted that while these are outputs of the agricultural sector, they are also inputs, as almost all are consumed within the sector. If forage plants are excluded from the calculation of crop values, the value of the remaining crops was down €324m (-24%). Cereals contracted by €377m (-52%) with prices accounting for 30% of this drop. Potatoes were up €50m (+30%) due to higher prices (+43%). Overall, the value of Agricultural Output at Basic Prices fell by €1.6bn (-13%) to €11.3bn.
Intermediate Consumption costs declined by 2% to €7.8bn. If forage plants are excluded from this calculation, then costs are down by €289m (-4%). However, these figures mask some significant positive and negative movements in input costs. The cost of fertilisers fell by €400m (-33%) due to both lower prices (-22%) and volumes (-13%), while the cost of feeding stuffs fell by €24m (-1%) due to lower volumes. FISIM, an implicit fee paid to financial institutions and incorporated into interest payments, contracted by €43m (-57%). It should be noted that this reduction in FISIM should be considered together with the rise of €66m (+97%) in net interest payments, as the latter are excluded from the calculation of Intermediate Consumption costs but are factored into the computation of Entrepreneurial Income.
The costs that rose most notably in 2023 were veterinary expenses, which grew by €38m (+11%) due to both higher prices (+6%) and volumes (+4%), and Other Goods & Services, which also cost an additional €38m (+6%), with higher prices accounting for 5% of this increase. Price inflation (+4%) was also the main driver behind the additional expenditure on Maintenance & Repairs (+€31m, +5%). The cost of seeds rose by €28m (+28%) while expenditure on Energy & Lubricants was up by €10m (+2%).
The impact of the reduction in the value of agricultural outputs, which was just marginally tempered by lower Intermediate Consumption costs, combined with higher fixed capital consumption (+€45m, +4%) and compensation of employees’ costs (+€39m, +4%), lower Other Subsidies less Taxes on Production (-€308m, -16%) resulted in Operating Surplus falling by 39% to €2.9bn. When net interest and land rental costs are accounted for, Entrepreneurial Income contracted by 49% to €2.1bn in 2023 (See Table 1.2).
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Statistician's Comment
The Central Statistics Office (CSO) has today (16 October 2024) released Regional Accounts for Agriculture 2023.
Commenting on the release, Mairead Griffin, Statistician in the Agricultural Accounts & Production Section, said: “At a national level, there were significant contractions in the value of Agricultural Output at Basic Prices which was down by €1.6bn (-13%), Intermediate Consumption costs by €127m (-2%) , Operating Surplus by €1.9bn (-39%), and Entrepreneurial Income, which factors in the cost of net interest and land rental, by €2.0bn (-49%).
To fully understand the performance of agriculture in 2023, it is worth comparing it with 2019, the last year before the upheaval to world markets caused by the COVID-19 pandemic and the war in Ukraine. Compared with 2019, which was not a particularly good year for the sector, the value of Agricultural Output at Basic Prices in 2023 was up by €2.8bn (+33%), Intermediate Consumption costs were €2.2bn (+39%) higher, Operating Surplus grew by just €45m (+2%), while Entrepreneurial Income was €316m (-13%) lower.
Output Values
Milk and cereal production, which were the best performers in 2022, performed badly in 2023. With almost no change in the overall value of livestock, they were the two main items impacting the value of agricultural outputs. There was a €1.5bn (-30%) reduction in milk values, mainly attributable to a 26% fall in prices, while the value of cereal production decreased by €377m (-52%) due to both volumes and prices contracting by roughly 30%. The regional dependency on these two items, particularly milk, combined with the prevalence of the relevantly better performing outputs, is the main reason for the large variation in the rate of decline in agricultural incomes. Regions with a high dependency on dairy were particularly negatively impacted by the reduction in milk values, while those with the lowest dependency were least affected.
While the headline figures are all very negative for 2023, looking at output values in isolation, there was some good news. A 43% increase in potato prices resulted in their value growing by 30%. The Dublin & Mid-East Region (Dublin, Kildare, Louth, Meath, and Wicklow), which produced 57% of Irish potatoes, benefitted most from this rise. The value of pigs increased by 7% and poultry was up 8%. The Border region (Cavan, Donegal, Leitrim, Monaghan, and Sligo), which produced almost 71% of Irish poultry and a quarter of Irish pigs, gained from these rises.
Intermediate Consumption Costs
While the cost of almost all inputs grew, the impact of lower expenditure on fertilisers, which fell by 33%, saved the agricultural sector €400m and was the main contributor to an overall reduction of €127m (-2%) in Intermediate Consumption costs. Excluding forage plants, the most notable increases in expenditure were on Other Goods & Services, (+ €38m or +6%), veterinary expenses, (+ €38m or +11%), and Maintenance & Repairs, (+€31m or +5%). In relative terms, the Midland region (Laois, Longford, Offaly, and Westmeath) gained most from the fall in fertilisers prices, with the region’s spend on the item down by 41%.
Agricultural Income
At 50%, the South-East (Carlow, Kilkenny, Waterford, and Wexford) had the largest fall in Operating Surplus, followed closely by the Mid-West (Clare, Limerick, and Tipperary) at 48% and the South-West (Cork and Kerry) at 46%. When net interest and land rental costs are accounted for, the most significant declines in Entrepreneurial Income were in the South-East (-61%), the Mid-West (-60%), and the South-West (-55%). At the opposite end of the spectrum were the West (Galway, Mayo, and Roscommon) and Border regions which, at 17%, had the lowest reductions in Operating Surplus. The Border saw Entrepreneurial Income contract by 22% while it fell by 19% in the West.”