Supermarkets will have to pay higher prices to vegetable growers this year to cover input cost inflation in the sector, according to Teagasc.

“Growers have been negotiating with their consolidator or supermarket buyer for price increases over recent years with varying degrees of success.

“Increases will be required in 2025 to cover input price inflation and provide margin to de-risk the business model with regard to the vagaries of climate, incentivise generational renewal and allow margin for additional capital investment to mitigate these headwinds,” Teagasc said in its Horticulture Crop Input Price report for 2025.

It found that over the last two years the combined impacts of climate change, energy cost fluctuations and the cost and availability of labour are increasingly driving an increase in the cost of production.

Since 2021, combined horticultural inputs have risen by an average 51%, it said.

These increases range from 36% in the soft fruit sub-sector to 76% in high wire crops.

Labour continues to be the highest spend and represents on average 42.6% of total input costs. This is followed by electricity and heating which can account for up to 25.7% and plant protection which can be up to 13.8% of costs.

Sector-specific inputs have also seen a large increase.

Between the start of 2024 and 2025, composts, substrate and casings have jumped by 8.9% in the mushroom sector, meanwhile, growing media, seeds and plants have increased in the soft fruit and high wire crops sub-sector by 10% and 8.9% respectively.

Investing

Teagasc also suggested that growers will have to invest to future-proof their systems against weather events.

“This indicates that Irish growers will need to invest to increase the resilience of their crops and production systems, as difficult growing conditions are increasingly likely to affect all stages of crop production,” the report said.

“Ultimately, all inputs are expensive when crop quality suffers, if yield is impacted, or indeed if a crop cannot be planted (or harvested) at all.”