More horticultural food producers are set to stop trading in the coming year as inflation chips away at profit margins, according to new research by Teagasc.
Horticulture – the field of agriculture related to growing pants such as vegetables, fruit and mushrooms – is the fourth largest agriculture sector in Ireland, beaten only by dairy, beef and pigs in terms of value. The sector is valued at €477 million per year.
However, Dermot Callaghan, Head of Teagasc’s Horticulture Development Department, said that inflation of costs for producers is making the industry less profitable.
“While Brexit, Covid-19 and the continuing Ukrainian crisis have pushed input prices much higher in recent years, input price inflation continues in 2023,” he said, adding that producers were being “squeezed.”
“A response from the market is required, if the viability of the industry is to be maintained, and the flow of local, nutritious, fresh, top quality produce on to the supermarket shelves is to continue,” he added.
According to the research, in overall terms, the prices of fruit and vegetables are now lower than they were in 2003. However, in the last year there have been significant increases in the costs of energy, labour, packaging, fertiliser, and more, eating into horticulturalists’ margins.
Notably, one resource which has become more expensive is growing mediums such as peat, which Ireland is exporting in large quantities.
“It would appear then that everyone loves Irish peat with the exception of our own Government who are hell-bent on regulating it out of existence,” said Deputy Nolan.#gript https://t.co/uAfDB4z4ZR
— gript (@griptmedia) January 19, 2023
Teagasc claimed that in recent years a “significant” number of vegetable growers have stopped trading, and that the indications for this season seem to show this trend continuing. The group estimated that the are of field vegetable production will be down 7% this year.
According to Irish Farmer’s Association President Tim Cullinane last year, Ireland is facing a “huge threat” as regards food security and the country’s ability to feed itself.
IFA President Tim Cullinane has told Gript that Ireland is facing a "huge threat" as regards food security and the country's ability to feed itself. #gript pic.twitter.com/djral7nu0f
— gript (@griptmedia) October 3, 2022