Mixed fortunes
It's fair to say that 2025 was a year of mixed fortunes for Irish farmers. While sheep and beef farmers benefited from strong market demand and high prices, the Irish dairy and pig sectors experienced significant headwinds. Given the primacy of the dairy sector over the last decade or so, this represented a major shift in the Irish agricultural landscape; and I know many farmers who are now wondering if the 2025 trend will continue into the New Year.
Unfortunately, as most farmers know too well, farming is a volatile business and the agricultural sector is exceptionally exposed to sudden and unexpected developments at the local, national and international level. This means that any predictions for the year ahead should come with a significant health warning, because it is getting harder and harder to account for massive geopolitical shifts in an increasingly unstable world.
That being said, some projections can be made based on the available data.
Dairy
Very few dairy men will wax lyrical about their fortunes in 2025. Excessive global milk supply, coupled with weaker demand for dairy produce, has taken its toll on the dairy farmer's bottom line. Unfortunately, this trend looks set to continue into 2026 and will be compounded by stubbornly high input costs. This means that, barring a major change in the global market, Irish dairy incomes will probably continue to slide over the next couple of quarters.
If there is a silver lining for the dairy farmer, it is the unusually high prices for dairy-beef calves and cull cows. We can only hope that this, alongside good grass growth in 2025, will help to insulate Irish dairy farms from the worst impacts of this change in fortunes.
Beef
After years of depressed prices and hostile market conditions, the Irish beef sector experienced something of a renaissance in 2025. As any beef farmer will gleefully tell you, prices in 2025 were better than they've been for a very long time. The unexpected strength of the beef sector will likely result in an uptick in conversions from dairy to beef farming. At any rate, there are indicators that beef's resurgence will continue into 2026 with most market experts predicting that profit margins for the sector will stay well above historical averages. A narrowing of the historical gap between suckler and beef finishing enterprises is another possible consequence of this phenomenon.
All told, the outlook for Irish beef is positive - a welcome change indeed, given the miseries that have been heaped on the sector over the last couple of decades.
Pigs
There is little to cheer about for the Irish pig sector. Most pig farmers are reporting very tight margins, with many struggling to cover soaring costs. All told, the cost of production is the Achilles' Heel of the sector and this looks set to continue into 2026. In such a market, farmers are unlikely to invest further in their businesses. Most will be hoping to see a significant improvement in the global market and will be watching trends carefully.
For now though, the prudent pig producer will batten down the hatches and hope to ride out what may well be another difficult year.
Sheep
I am sympathetic to the argument that no area of Irish agriculture has suffered more than the sheep sector. Barring a few temporary improvements in the market, sheep farmers have struggled mightily in recent years. On that basis, none of us should begrudge them the significant improvements they saw in 2025.
According to the available data, sheep farmers are forecast to enjoy a 5% increase in average farm income (rising to €38,500). This will come as a result of increasing lamb prices, driven by limited sheep supply within the EU; as well as strong payments from schemes such as the Sheep Improvement Scheme. Sheep production costs also look likely to decrease in the coming months, further bolstering a generally strong economic outlook for sheep producers.
Tillage
The Irish tillage sector experienced some difficulty in 2025, and 2026 looks set to be another challenging year. Significant price pressures, increasing costs, and reduced demand for certain products are all contributing to a tightening of margins for the tillage farmer. The proposed Carbon Border Adjustment Mechanism (CBAM) represents a particular obstacle, as it may lead to a major increase in fertiliser costs that could hamstring the sector for the foreseeable future.
On those grounds, the Irish Farmers' Association (IFA) and other farming organisations have urged the government to address rising costs, particularly the CBAM tax, and provide support to the sector. The Tillage Expansion and Sustainability Scheme (TESS) is an important support for farmers trying to meet climate goals, but additional supports will surely be needed to help farms remain viable.
Final thoughts
The outlook for Irish farmers in 2026 is very much a mixed bag, with some sectors enjoying unprecedented good fortune and others experiencing major challenges. It is important to remember that there is nothing new in this - farming is a game of dizzying highs and terrible lows. For that very reason, it is important that we show solidarity with our fellow farmers, especially those facing difficulties as we head into the new year. As a community, we are stronger when we support each other.
Wishing all Irish farmers and their families the very best for the New Year!
MPG
