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The land area of Ireland is 6.9 million hectares, of which 4.5 million hectares is used for agriculture and a further 0.73 million hectares for forestry. Just over 80% of agricultural land is devoted to pasture, hay and grass silage, 11% to rough grazing, and 8% to crops, fruit and horticulture. In 2014, the average farm size in Ireland was 47 hectares and the average income €569 per hectare. The average farmer is aged 57 years, and the agriculture, forestry and fisheries sector provides employment to approximately 163,000 people. More than any other industry, much of the economic benefits in the agri-food sector, both direct and indirect, are dispersed throughout the country making it particularly important to rural areas.

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The most recent statistics on Irish farming income come from the Teagasc National Farm Survey 2014 which includes only farms with a standard output of €8,000 or more. According to this survey, the average income on an Irish farm in 2014 was €26,974. However, this figure hides a wide income distribution; 24% of farms produced an income of less than €5,000, while 18% of farms yielded over €50,000. Income varies considerably by production type; dairy is the most profitable system with average farm income of €68,877, whereas average farm income from cattle rearing is just €10,271.

In 2012, approximately 38% of farms were categorised as economically viable, while 29 were viewed as sustainable. A sustainable farm is not economically viable but can survive due to the presence of off farm income. In 2014, 51% of farms had off-farm employment.

On average, total subsidy payments were €18,859 in 2014, accounting for 70% of income. On cattle and sheep farms, subsidies accounted for over 100% of income. By contrast, they only account for 30% of income on dairy farms. In 2014, subsidies comprised the Single Farm Payment (SFP) and payments relating to the Disadvantaged Area Scheme (DAS), the Rural Environmental Protection Scheme (REPS) and the Agri-Environmental scheme (AEOS).

The output from the primary agriculture sector in 2014 is estimated at €7 billion (at producer prices) with intermediate consumption estimated at €5.1 billion. Gross new investment in farming totalled €729.2 million, while the primary agriculture sector is the largest component of new lending, accounting for €600m, or 23% of all new loans, between September 2013 and 2014.

Ireland invests heavily in rural development. In January 2014, the government announced a total CAP funding package of €12.5 billion for the period up to 2020. This comprises €8.5 billion in EU direct payments, just over €2 billion EU funding for rural development, and just under €2 billion in additional exchequer co-funding for rural development. Ireland’s 2014-2020 Rural Development Programme (RDP) includes a new agri-environment-climate measure (GLAS) and a Targeted Agricultural Modernisation Scheme. Recent innovations undertaken by the government to promote environmental sustainability include the development of Origin Green, which is which is designed to help Ireland to become a world leader in high quality sustainably produced food and drink. In addition, an agri-taxation Review was published in 2015 as a joint initiative between the Department of Agriculture and the Department of Finance.  The Report forms a coherent strategic framework for future agri-taxation policy.

There is a strong focus in Ireland on providing on-going support for young farmers. In 2014, it was confirmed that the full 2% of the national direct payments ceiling will be allocated to young farmers, providing for a 25% ‘top-up’ on direct payments on up to 50 hectares for farmers under 40 years of age. These direct payments measures will be complemented by further support under the Rural Development Programme, where a separate strand of the support for on-farm capital investment will be ring-fenced for young farmers at a higher rate of aid intensity of 60%.Other supportive measures include for young farmers include 100% Stock Relief for Certain Young Trained Farmers, Capital Gains Tax Relief for Transfer of a Site from Parent to Child and Exemption on Transfers of Land to Young Trained Farmers Stamp Duty.

During early 2015, a Committee made up of 35 leading figures from the main stakeholders in Ireland were brought together by Ireland’s Minister of Agriculture to develop a new strategic plan for the Irish agri-food sector up to 2025 .  The Committee has considered the challenges faced by the sector and the opportunities for growth up to 2025 and produced a 10 year Vision and strategic plan for the sector under the title – Food Wise 2025, Local Roots Global Reach.

Food Wise 2025 recommends over 350 actions, both cross-cutting and at sectoral level, which the committee with their broad knowledge and experience of the sector believe will support and facilitate the development of the sector over the next decade, putting in place a business and regulatory environment which will allow the sector realise the growth opportunities which are available and which enhance the sectors contribution to the Irish economy.

 

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