INDEPENDANT
11/12/2007
Sheep farmers will need an additional €3-4/hd for lambs this spring to offset higher feed costs, Teagasc sheep specialist Michael McHugh has claimed.
Mr McHugh, who is head of the sheep advisory service with Teagasc, pointed out that feed is the single biggest variable cost in sheep production.
With meal charges predicted to increase by 35pc this winter, the Teagasc specialist said farmers would need a lamb price rise of 15c-20c/kg "just to stand still".
Speaking at a sheep meeting in Knocktopher, Co Kilkenny, Mr McHugh admitted that most sheep farmers were losing money from their farming enterprises.
However, he said research had shown that overall returns from a 200-ewe flock, excluding the single-farm payment, could vary by as much as €10,200.
Using data from Teagasc's eProfit Monitor for 2006, Mr McHugh calculated that the top one third of sheep farmers would make a profit of €4,600 from a 200-ewe flock.
However, farmers in the bottom third would lose €5,600, while those in the middle third would suffer a €600 loss.
Although Mr McHugh conceded that the results did not make for "good reading", he said it was positive that people could still make a profit from sheep in what had been a very difficult period for the sector.
The eProfit Monitor results showed that the top third of farmers were making €23/ewe, the middle third were losing €3/ewe, while the bottom third of farmers were losing €24/ewe.
Mr McHugh identified three factors which contributed to the differential in returns per ewe.
He pointed out that the top farmers were attaining higher lamb output per ewe; higher lamb prices and had lower variable costs per ewe.
Mr McHugh said there was an €8/hd difference in the average lamb price attained by farmers in the top third compared to those in the bottom third.
Similarly, variable costs per ewe differed by €10/hd.
