Farmers to pay more for contractor services

Farmers can expect to pay more for contractor services in 2024 as operational costs ‘soar’, according to the Association of Farm and Forestry Contractors in Ireland (FCI).

In its latest contracting charges guide, the association warns that some charges are up by a maximum of 4pc, while others remain unchanged.

The increasing costs of new machinery for farm and forestry contractors continues to impact on the sustainability of many Irish agricultural contracting businesses, the FCI said.

“Machinery costs have risen by more than 30pc in the past three years, while spare-parts prices have risen by even larger amounts,” according to FCI National Chair John Hughes.

“Contractors also have new and additional costs in 2024, with the combination of the minimum wage increase along with the new legal requirements around the provision of pension funding for employees.

“These are additional increased costs that contractors have to factor into their 2024 operational costs.”

The cost of bale wrap, stack and move has risen to €23-€26/bale, up from €22€25/bale in 2023. Umbilical spreading will cost €180-€193/hour, up from €175€185, with a set-up charge of €100/hour.

Fuel taxes

Additional fuel taxes will mean a further increase in fuel costs of up to 12 c/L, before VAT, during the 2024 season.

The FCI warned that these taxes will bring agricultural diesel costs back to “almost the unsustainable 2022 levels,” while world market prices for fuel remain relatively stable.

Contractors are also concerned around skilled operator availability, with a scarcity of young people joining the sector.

The FCI said it is disappointed that the recently announced apprenticeship scheme for agriculture did not include its request for structured training for tractor and machinery operators for the sector.

“Many agricultural contractor businesses are multi-generational and because of this, Irish farmers value the highly skilled and professional service from their contractors,” said Hughes.

“For 2024, our sector faces higher cost and skills challenges as we strive to provide our farmer clients with a commitment of cost-effective and sustainable machinery services.”

The full FCI contractor charge guide for 2024 is on P20. It is an average figure for each operation from a panel of FCI contractor members.