• Can’t See the Wood for the Trees: The Returns to Farm Forestry in Ireland

      Breen, J.; Clancy, D.; Ryan, Mary; Wallace, Michael (Teagasc, Oak Park, Carlow, Ireland, 2010)
      The period 2007-2009 witnessed considerable variability in the price of outputs such as milk and cereals and this was compounded by a high degree of volatility in the price of inputs such as fertilizer, animal feed and energy. Previously, Irish farms have used the returns to off-farm employment as well as agricultural support payments such as the Single Farm Payment (SFP) and the Rural Environmental Protection Scheme (REPS) to protect their living standards against low and uncertain agricultural market returns. However, the downturn in the Irish economy has led to a reduction in the availability of off-farm employment and also the discontinuation of REPS. This may lead to an increase in afforestation on Irish farms, as forestry offers greater certainty through the provision of an annual premium in addition to the SFP. However, the decision to afforest represents a significant long-term investment decision that should not be entered into without careful economic consideration. The aim of this paper is to use the Discounted Cash Flow (DCF) analysis method to calculate the returns to forestry under alternative opportunity costs associated with conventional agricultural activities being superseded. The returns to forestry are calculated using the Forestry Investment Value Estimator (FIVE). These returns were then incorporated in the DCF model along with the returns to five conventional agricultural enterprises, which would potentially be superseded by forestry. This approach allows for the calculation of the Net Present Value (NPV) of three forestry scenarios.
    • Does the single farm payment affect farmers’ behaviour? A macro and micro analysis

      Howley, Peter; Breen, J.; O'Donoghue, Cathal; Hennessy, Thia; European Commission; QLK5-CT-2000-00473; SSPE-CT-2005-021543 (Institute of Agricultural Management, 2012-10)
      Using Ireland as a case study, the overall aim of this paper is to determine if decoupled payments affect farmers’ behaviour. Using a dynamic, multi product, partial equilibrium model of the EU agricultural sector, this paper first compares levels of production that would be expected if decoupled payments had no impact on farmers’ activity with actual observed outcomes. Second this paper compares cereal and cattle farmers’ profitability prior to decoupling with that observed after the introduction of decoupled payments. The analysis presented here would suggest that decoupled payments do still maintain a significant effect on agricultural activity with farmers using this new form of support to partly subsidise unprofitable farm production.
    • Situation and Outlook in Agriculture 2008/09

      Breen, J.; Connolly, Liam; Donnellan, Trevor; Hanrahan, Kevin; Hennessy, Thia; Kinsella, Anne; Martin, Michael; Ryan, Michael; Thorne, Fiona (Teagasc Rural Economy Research Centre, 2008-12)
      CONTENTS: (1)Farm Incomes 2007; (2) Investment in Agriculture 2008/09: Dairying, Cattle, Sheep, Pigs, Tillage, Forestry