EPA - Ireland's Environment, An Integrated Assessment - 2020

Chapter 13: Environment and Agriculture Economic Situation Farm type, market volatility, weather conditions, increased production costs and direct payments all contribute to different and changing farm incomes. The principal measure used in Teagasc’s annual National Farm Survey is Family Farm Income, representing the economic return secured by the farm family from labour, land and capital (Teagasc, 2020a). The average Family Farm Income across the 92,720 farms represented by the survey was approximately €24,000 in 2019, a 2 per cent increase on 2018. Family Farm Incomes vary from year to year and are reflective of inherent volatility, weather conditions and increased production costs. Income levels on tillage farms, however, showed a decrease of 15 per cent, with increased income levels for dairy and livestock farms. For the dairy sector, milk production increased by 5.3 per cent in 2019 with average income increasing by 9 per cent to €66,570 in 2019. In general, farm incomes continue to be highly reliant on direct payments. In 2019 the average total direct payment received was €18,452 per farm and this accounted for 77 per cent of average farm income. In terms of individual schemes, agri-environmental schemes were more important on cattle rearing farms than on dairy and tillage farms accounting for up to 12 per cent of total payments on such farms. Of particular importance is that, although direct payments were lowest on cattle- rearing farms, their overall contribution to farm income, at 160 per cent is the highest recorded. Furthermore, when comparing farm systems in terms of their market income, it is evident that income from cattle rearing and sheep farms is less than zero, indicating that on average these farms are loss-making. Food Wise 2025 The significant pressures on the environment as a result of agriculture growth resulting from FoodWise 2025 need to be mitigated urgently, and resolved to meet the EU legislative requirements. Food Wise 2025 is a 10-year strategy agreed by a range of stakeholders, both public and private, and adopted by government as an overarching strategy for the Irish agri- food sector. Food Wise 2025 identified significant growth opportunities across all subsectors of the Irish agri-food industry. It predicted that growth would be driven largely by an expansion in dairy, beef, seafood and consumer food and drinks products and that, cumulatively, there was the potential for projected growth in gross value added of 70 per cent for the sector by 2025. However, by early 2020 these growth projections were largely met. Such rapid expansion has presented a significant challenge for the sector as it seeks to realise opportunities without damaging the environment on which it depends. Halfway through the implementation of the strategy, there is evidence of significant environmental challenges arising from agricultural activities that must be addressed. Contributions from the sector’s activities in relation to a wide variety of environmental pressures and targets and adaptation challenges are discussed in this report in relation to climate (Chapter 2), air quality (Chapter 3), nature/biodiversity (Chapter 6) and water quality (Chapters 7 and 8). Specific significant environmental pressures that require immediate and concerted action are discussed in the following sections of this chapter. Ireland has a reputation for high-quality natural food production and critical to this reputation is that food produced in Ireland has a low environmental footprint, in conjunction with adherence to strict traceability and animal welfare criteria. However, this reputation is now at risk as a result of current trends in air pollutant emissions (most importantly ammonia), greenhouse gas emissions, water quality and biodiversity decline. More fundamentally, these important issues, if not addressed, have the potential to undermine the ability of agriculture as we know it to continue to produce food and other products. 331