The Teagasc National Farm Survey for 2024 showed improvements across the board for farm incomes, while once again highlighting the differences in earnings between different farming methods. Average dairy incomes, at €108,200, came in eight times higher than the average income for suckler farmers.

However, it is away from the income data that we can see that the structural issues the sector has faced in recent years continue unabated. Principle among those is the issue of succession, and getting the next generation of farmers into the industry.

Looking at the data, we can see that the average age of dairy farmers has increased by seven years in the decade since 2015, hitting 54.7 for those covered by the Teagasc report.

For suckler, or cattle rearing the ageing has been slightly faster at 7.3 years over the period, but as that cohort were already, on average, older than dairy farmers in 2025, it leaves the average age at 61.7 years in 2024. Taking all farming systems into account, we can see ageing of 5.2 years to 59 years (see Figure 1).

This aging of the farming population can also be seen in the statistics on the number of farm households in receipt of a pension. For all systems that has risen considerably over recent years, with close to half of suckler farmers now in receipt of the payment (see Figure 2).

When it comes to financial sustainability of farm enterprises, the number of farms which are classified as “viable” by Teagasc is at 42.2% in the report for 2024.

That number is close to the record high of 43.9% seen in 2021, with the dairying by some distance the farm system where the largest percentage operations are classed as viable.

Around a third of farms in the report are classified as “sustainable” which is a measure of financial health of the farm household which includes off-farm income, either for the farmer or their spouse.

The final category, “vulnerable”, is for farms which do not meet the minimum income required to cover a very basic wage.

As Teagasc does not count pension payments in their financial sustainability calculations, it is possible that the vulnerable farm households are being financially sustained by those payments.

The Irish Farmers Journal put these issues to Kevin Hanrahan, head of the rural economy and development programme at Teagasc, and Emma Dillon, the senior research officer and economist for the national farm survey.

Hanrahan said that when it comes to farm viability: “In many parts of Ireland, the rural economy is supporting agriculture. In the area I live in south Galway where it is mostly small farms, [the farmers] have to be working off-farm to support their household.”

He said that this means the performance of the off-farm rural economy is very important for the sustainability of less-profitable farm enterprises.

“There has been very slow structural change in Irish agriculture to this point, and what’s facilitated farm families to stay farming in many cases has been that non-farm income.

“The strength of the Irish economy has supported the continuation of cattle farms that are earning incomes that are very low in today’s Ireland.

“If those non-farm jobs were not there, we would have seen much greater structural change in Irish agriculture.”

He pointed out that the strong economy is something of a double-edged sword for the future of farming, as it means that the next generation of potential farmers has many career opportunities which farming has to compete with.

Hanrahan was more optimistic about the economic impact of more profitable farming systems, saying: “There are parts of the country where the farm economy is supporting the rural economy.

“For example, in dairy intensive regions the story would be quite different as there would be lots more related employment in milk processing, feed and fertiliser merchants and related services.”

Succession

Dillon said that Teagasc has asked farmers about succession planning and found that six in ten farmers have a plan in place. However, about a third of them don’t expect that plan to happen for many years.

“We’re also doing research at the moment talking to potential successors. They’re well established in [off-farm] careers and they’re happy for the succession to be delayed. I would envisage that many of those farms would be run on a part-time basis on a low enough scale.”

She said, when asked if this means that the trend of falling suckler cow numbers in the country is set to continue, that “it is hard to see the trend changing”.

Similar to Hanrahan, she made the point that a buoyant off-farm economy and the opportunities elsewhere mean it is challenging for someone to come back and take over a farm.

The current structure of farm payments, and the tax incentives around leasing land, also mean that older farmers may have little motivation to pass on the farm to the next generation. “It’s hard to ignore the presence of payments for those older farmers and the disincentive that is there in terms of succession,” she said.

Comment

Like all economic activities, farming is at the mercy of both cyclical and structural issues. On the cyclical side the cost of inputs such as feed, fertiliser and fuel are influenced by global events happening far from the farm gate while prices received for production are a function of consumer behaviour in the UK, the US and Asia.

Fundamentally, farmers have little or no control over either the cost of what they buy or the prices they are paid. We can clearly see this in the high volatility across farm incomes from year to year.

The structural issues highlighted by the report, where the average age of farmers across all systems continues to rise while the number of farms classed as viable by Teagasc is constantly in the minority of operations, are the long-term trends that will decide where farming will be for the next generation.

These structural issues, however, are the challenges which can be met by farmers and policymakers.

The incentives that are in place at the moment, such as the push towards organic farming and payments for environmental actions, mean that income can be gained from farms where the actual production of food may end up being a secondary concern.

The lease system has benefits for larger and more profitable farms as it can give access to land, but it also means that in many cases that leased land will not change hands to the next generation.

Other policy measures like the drive for organic production mean that older farmers in receipt of a State pension could have a reasonable, if modest, income from their land without having to do a huge amount of actual farming.

For the next generation, the farm could well be seen as a source of passive income, through leases and payments, rather than something that needs hard work and long hours to extract a living from.

There’s plenty to suggest that this is in fact the desired policy outcome. It will, for example, lead to a continued reduction in the national herd.

But there is also a food security issue which has to be addressed. Data published last week by the UN showed that demand for meat and dairy is only set to grow further. Policies in place which disincentivise the transfer of farms to the next generation put the ability of Irish agriculture to supply the needs of that global demand at risk.