Dairying is the big gorilla in the room, and despite poor grass growth this spring, grazing conditions have been superb, so that every blade that pokes its head above ground is fully utilised.

This will set up beautiful leafy regrowth for the rest of the grazing season, and already at home we’ve seen a big jump in the total kilos of grass eaten per head compared to last year.

Everyone has a bounce in their step, with milk prices strengthening just at the right time for Irish farmers as they turn on the volumes that naturally come in the first three months after calving.

The combination of good grazing along with good base prices will push the take-home price over 40c per litre for the best operators.

Grain prices also look to be as high as they ever were this year at close to €200/t.

While I might privately grumble about the chunk that I forward-sold in the autumn, I’ll have to publicly console myself with the truism that nobody ever made a loss by taking a profit.

Sheep farmers are thrilled skinny with the 50pc bump in prices they’ve experienced in the last 12 months, although as one wisecrack noted, a 50pc increase in feck-all is still feck-all.

So why the gloomy opening remark?

Well, the inflation I’m seeing right across the board is something that I’ve never experienced in my farming career.

 

Growling

I was growling earlier this year about 30pc increases in the concrete and steel that I’m using in a few shed renovations, but now I realise that every other item has been on the march too.

Electricity prices increased to some of their highest levels in 15 years this spring, but nobody said boo about it. That’s Covid for you.

The shock of that increase is all the more dramatic given that it was at an all-time low last year.

But it’s the ancillary stuff that is getting me. Carbon taxes have effectively doubled the PSO levies on our energy bills; fertiliser has jumped by over €100 a tonne.

Even the little plastic bags that I use to pack daffodil bulbs into have gone up by 33pc in the last 12 months.

Higher grain prices will be good for the cereal men, but it might not be great news for the livestock sector, especially if you were also hoping to get your hands on some reasonably priced straw for bedding next winter.

The new straw incorporation scheme might create a lot of unintended consequences by forcing livestock farmers to re-evaluate how they accommodate their stock over the coming years.

I’m sure the Greens didn’t plan on livestock farmers opting instead to create more slatted housing rather than pay through the nose for straw.

Meanwhile, I see the elite in the farming sector pulling ever further away from the main pack in terms of the scale and profitability of their operations.

I was admiring an immaculate 2018-reg John Deere in a farmer’s yard last week. It was a 6175R, which in old money is a 195hp machine, fully kitted out with enough auto-steer technology to fly you to the moon and back.

The farmer was delighted that he’d managed to pick up such a well-looked-after machine second-hand. I agreed, noting sagely that “those yokes would set you back over €100,000 handy enough”.

He looked at me askance. “It cost me €120,000 as a three year-old machine, and that was value!” he exclaimed, with a nod of his head that said ‘get a grip on yourself if you think you know the costs of modern machinery, McCullough’.

The same day I met a dairy farmer who had decided to buy his own silage kit, complete with a new self-propelled forage harvester.

My guess is that you would have no change out of €750,000 for that set-up, but maybe when you spread out the cost over 1,000 acres of silage annually, the machines would be paid for after less than 10 years. And you get your silage made when it suits you.

 

Reinvest

Farmers’ first instinct in a good year is to reinvest in the business, and it’s exactly what I do myself.

However, with the price of everything sky-rocketing at the moment, it might be a year to pull in the horns and play a conservative hand.

But the farmer in me is worried about falling ever-further behind in the race for scale and efficiency.

It’s a balancing act that’s only going to get trickier in a year like 2021.