What are your thoughts on the fertiliser price s for 2022

Grueller

I have enough CAN for the spring at €685 and 18-6-12 and 10-10-20 at €740. Bought a few weeks back. Mad to say that I am starting to think that this was value.

green daries

https://www.boards.ie/discussion/comment/118393091#Comment_118393091

Its truly mind boggling grueller to think that it actually is value as you say but it's piece of mind also for your business

alps

https://www.boards.ie/discussion/comment/118392819#Comment_118392819

There are so many answers to this.

Full economic cost of producing milk is nearly always the price of the milk. This happens because there is volatility in our industry, and on a poor price year (like 2015) production costs plummet as farmers match cash flow to its capability, and only vital costs are incurred.(live off depreciation) When milk price increases, farmers catch up on what was skipped on the bad years..soil fertility, silage buffers, repairs and maintenance, machinery replacement...and typically the costs on those years match the income.

The farmers that can't survive these cycles bow out. It's been a normal cycle now for some time.

Next year will be the same, as farmers will again match their costs to income...this time however it's the opposite way around, where some cost's are the uncontrollable, rather than the product price.

The value of extra land can, from a dairy perspective can only be judged by how much it will grow without fertiliser, as against the savings on the reduced fertiliser on the current holding.

Case

Assuming rented ground could grow 6 tonnes without fertiliser (first season on 0 inputs) a 10 ha plot would grow 60 tonnes.

A 50ha farm using 230 units N/ac will spend €26,500 on N in 2022. If that farmer rented 25 acres at €250 it would cost 6,250.

Reducing the above fertiliser spend by €6250 would mean an allowance of just 155units/ac for the 50ha of the farm.

To match the 14 tonne output from 230 units N, the 50ha will now have to grow 12.8 tonnes from the 155 units/ac to have the same amount of grass grown overall..(this excludes any increased contractor costs incurred for extra ground that may be cut).

I've purposely left out P&K costs, as I'm expecting having come through a couple of good years, many farmers will have taken the opportunity to "overspend" on soil fertility, will have banked, and will be in a position to park that cost for 1 year.

Maybe these guys taking extra ground are going to put on extra cows? Extra cows at 45c would be in a stronger position to pay 400/acre than cows on 30c paying 300/acre..

jimmy G M

https://www.boards.ie/discussion/comment/118393091#Comment_118393091

Yeah, prices going up alright...... I bought CAN at €720, 18.6.12 at €750 today. Quoted for 10.10.20 at €765. Wish I had bought a few weeks back. Quoted €680 for CAN then.... no urea available to order at all apparently. Paid today. Expect delivery early Feb.

Have enough now for 35 acres of silage with the slurry, maybe a smatter on some of the grazing ground. Reducing the amount of silage ground being cut by 20 acres as expect to have 250 bales left over after this winter. Hoping the extra grazing ground will compensate for the lower fert rate. Our P & K and lime is pretty good here. Will re-appraise again over the summer. Suckler cow and weanling to forward store operation here so not going to be spreading much expensive fert here. 2023 could be the crunch year if prices and availability don't settle.

Mooooo

Question shouldn't just be about the cost of the fert but the return in terms of grass grown and the use you can then make from it.

Mooooo

https://www.boards.ie/discussion/comment/118393066#Comment_118393066

Dunno who ye deal with but I've yet to meet a teagasc advisor who wouldn't tell lads to soil test. First port of call for most advisors

mf240

Will higher prices be reflected in farm gate prices.

straight

https://www.boards.ie/discussion/comment/118393602#Comment_118393602

Farm gate prices will cover the cost of production. That's the way the food system is designed. Any higher and there is oversupply. Any lower and there is food shortages.

Danzy

https://www.boards.ie/discussion/comment/118393602#Comment_118393602

Some bit, enough to be ok, not enough to be right.

Bleating Lamb

https://www.boards.ie/discussion/comment/118392740#Comment_118392740

Yeah have soil results from two years ago,lime recommended for most areas of farm….but not put out as afraid it would leave the ground too tender iykwim…..in lovely Laytrim….not the Golden Vale:)

My query of those on here who would lime land……does it lead to a good boost in growth levels?…..especially if ground a bit starved of it.

degetme

https://www.boards.ie/discussion/comment/118393740#Comment_118393740

Lime is the cheapest and best fertilizer for your land if its needed

White Clover

https://www.boards.ie/discussion/comment/118393740#Comment_118393740

Heavy land here that would be well capable of growing rushes if it was left. I have been a fan of lime for a good few years now. Spread 75% of the farm last April @2 Tonne per acre. Got a savage response from it as I expected, easily the equivalent of a bag of nitrogen per acre if not more. The other 25% will be done this spring coming.

awaywithyou

Gas price has halved.... was 180euro per megawatt hour... now 90....

https://www.farmersjournal.ie/spotlight-on-fertiliser-prices-as-gas-price-falls-sharply-671100

kevthegaff

https://www.boards.ie/discussion/comment/118393975#Comment_118393975

Imagine we go into a deeper recession, how quick inputs will come back. It was only 6 months ago crude oil was nearly given away

Still stihl waters 3

https://www.boards.ie/discussion/comment/118393990#Comment_118393990

Are we in recession?

Grueller

https://www.boards.ie/discussion/comment/118394000#Comment_118394000

I don't know but its like I have never been out of one my whole life.

straight

https://www.boards.ie/discussion/comment/118394000#Comment_118394000

Not that I knew anyway. It going to be sore when it happens though. Depression maybe.

Bass Reeves

https://www.boards.ie/discussion/comment/118392969#Comment_118392969

I am not being small minded. There are two main way you register for tax either as an employee or as self employed ( you can even work both).

As an employee you take your wage and that is it. As a some trader you show you profit as your taxable return. The taxi drivers or the plumber down the road dose not do a tax return and say I earn X and Y of that is wages and Z= profit.

Farming or any other business is exactly the same. You return your profit. If your profits are high enough you try to manage the tax system by using any legal tax avoidance method.

If you are ultra profitable, you consider incorporate the business as you can retain profits within the business by paying 12.5% to the government in Ireland. This is attractive to some who have large excesses over drawings that they will have to pay the higher tax rate on. The disadvantage is the money and business is now in a separate entity and different rules apply.

At the end of it all anybody looking to enter the business area needs to know a few things. The most important is the margin per cow after direct costs. Anybody can then make a decision whether to go down the dairying route then. The necessity for drawing/ wages vary per person. A person with 2-3 kids going to college in a few years time has totally different needs to a lad in his early twenties who is looking at a longer-term plan.

green daries

https://www.boards.ie/discussion/comment/118394123#Comment_118394123

That's grand and all well and good but yet again not what was posted but look work away 👍I enjoy your posting .... mostly

straight

https://www.boards.ie/discussion/comment/118394123#Comment_118394123

Ultra profitable me hole. My wife earns 40 ish, buy to let "income" shove us over 70. Any income from the farm is taxed at 52%. Getting close to heading down the company route.

farawaygrass

https://www.boards.ie/discussion/comment/118394227#Comment_118394227

Yep, the tax band are way too low. Very easy to be in the higher tax band and still be hand to mouth

green daries

https://www.boards.ie/discussion/comment/118394227#Comment_118394227

I'd highly recommend it 😉

We do have one of the most progressive tax systems In the world.....

alps

https://www.boards.ie/discussion/comment/118394227#Comment_118394227

Jayses straight......you're bleeding it if not in a company...

Who2

https://www.boards.ie/discussion/comment/118394227#Comment_118394227

Or maybe just a different accountant. Sometimes these things can be worked without too much hassle.

Good loser

https://www.boards.ie/discussion/comment/118393091#Comment_118393091

Today paid €795 for 10/10/20 €700 for CAN.

Birdnuts

https://www.boards.ie/discussion/comment/118393454#Comment_118393454

I guess it depends on your adviser, a mixed bunch for sure but mustn't be much more than a box ticking exercise for most given the ongoing widespread problem of excessive nitrate and phosphate levels in soils, groundwater etc. https://www.irishexaminer.com/farming/arid-40773642.html. Similar problems by all accounts with the poor performance/outcomes of agri-environment schemes over the last 20 years as highlighted by recent EU audits on the matter. Can't say I was ever that impressed with any Teagasc advisor I had in terms of their interest or knowledge of such matters. Have heard similar from plenty of others too

alps

"The report said there have been some encouraging signs, with water quality improved in 152 of 726 prioritised water bodies"

That Examiner piece does mean anything you want it to mean...

Bass Reeves

https://www.boards.ie/discussion/comment/118394227#Comment_118394227

The term I used was to cover farm profits where it became necessary to incorporate to avoid tax. In Ireland because of low corporate tax rate AT 12.5 % it can become attractive to shelter income because if it. It must be looked at in the longterm. However it has its disadvantages as extracting money after use of tax allowances is effectively 65%.

You should be using pension reliefs and pay wages to children over 14 before you consider it. It might even be more beneficial to put the property into a REIT before incorporating the farm

degetme

https://www.boards.ie/discussion/comment/118394949#Comment_118394949

What is reit

degetme