Farm Incomes Set to Fall in 2026 as Milk and Cattle Prices Ease alongside Further Cost Pressures

As of mid-2026, the outlook for the global economy remains a concern due to the ongoing crisis in the Strait of Hormuz, which has pushed up international oil prices and created increased economic uncertainty. Against this backdrop, the outlook for farm incomes in 2026 is weaker than that recorded in 2025, with lower output prices in the dairy and cattle sectors combining with rising input costs to reduce margins across most farm systems.

Agricultural input markets have been under renewed upward pressure in 2026. The crisis in the Strait of Hormuz has driven fuel prices higher, while fertiliser prices have also increased on the back of higher energy costs. As a result, production costs are forecast to rise across all farm systems in 2026, relative to the already high levels experienced in recent years. However, farmers will also benefit from the government’s Fuel Income Support Scheme announced in May 2026.

Dairy Farms

Milk prices fell sharply towards the end of 2025 milk production season and have remained at lower levels in the first half of 2026. It is expected that the average milk prices in 2026 will be down approximately 20% on the average price level achieved over the course of 2025. Little change in Irish milk production volume is forecast in 2026. On the plus side, dairy farms will continue to benefit from elevated prices for calves and cull cows.

Combined with an increase in production costs, lower milk prices are set to sharply reduce margins on dairy farms this year. Taking all of these factors into account, the average dairy farm income in 2026 is forecast to fall to approximately €78,000, down sharply on the record level of €153,300 achieved in 2025, a decline of 49%. This underlines once again how sensitive dairy farm profitability remains to movements in milk price.

Cattle Rearing and Cattle Other Farms

Cattle prices remain at historically high levels in 2026, but the exceptional prices achieved in 2025 are not expected to be matched this year. Weanling prices are forecast to be approximately 10% lower in 2026 than in 2025. Finished cattle prices are expected to average 8% lower than in 2025.

This decline in finished cattle prices can be explained by developments in key export markets. In recent months, beef prices have weakened notably in key EU export destinations including France and Germany.

The decline in finished cattle prices can also be linked to the increase in beef exports from New Zealand to the UK, which had a direct negative impact on beef prices in the UK during the spring months, with a further impact on beef prices in Ireland.

While this source of beef trade is expected to decline in the second half of the year, there is an increase in competition from other non-EU countries for the UK beef market. These factors have reduced margins for cattle finishing enterprises in Ireland.

With production costs also rising, margins on cattle systems are set to decline. The average income on Cattle Rearing farms is forecast to fall to approximately €19,000 in 2026, down from €24,100 in 2025, a decline of 21%.  Incomes on Cattle Other farms (mainly cattle finishers) are forecast to average approximately €21,000, down from €32,800 in 2025, a decline of 36%.

Sheep Farms

Sheep prices are forecast to be around 3% higher in 2026 relative to 2025. However, this improvement in output prices is expected to be more than offset by lower margins from the cattle enterprises that are present on many sheep farms and by higher costs of production These developments are forecast to leave average income on Sheep farms in 2026 at €26,500, 10% lower than the €29,300 recorded in 2025.

Tillage Farms

Grain prices at harvest in 2026 are expected to be broadly similar to those achieved in 2025. It is still too early to accurately forecast likely crop yields, but with a reduction in tillage area and early yield indications pointing to a decline in yields relative to 2025 harvest, it is expected that total cereal production volume will be down in 2026. With production costs rising and a decline in the profitability of the subsidiary cattle enterprises operated on many tillage farms, average income on Tillage farms is forecast to be well down on the €54,900 achieved in 2025, at approximately €44,000. On the refined sample of specialist cereal, oilseed and protein farms it is estimated that incomes will also be down, by at least 20%.

Pigs

The Irish pig sector faces a tougher 2026, with weaker prices, rising costs, and lower incomes. EU pig supply has stabilised, but African Swine Fever in Spain has disrupted trade. Spanish exports have ended up on the EU markets, rather than outside the EU, pushing down pig prices in the EU as a result. EU consumption remains stable, but exports (notably to China and the Philippines) have weakened. Irish pig prices fell from 178c/kg to 168c/kg, with further declines likely as excess Spanish product persists.

Irish production has recovered modestly, with a slightly larger sow herd and slaughter volumes up 1.6% year-on-year. Production costs remain elevated, with feed staying above the long-term average, while energy, labour, and other non-feed costs rose 10-13% in 2026.

Despite strong profitability in 2023-2025, falling prices and high input costs are expected to cut pig farm incomes by around 45% in 2026 versus 2025

Average Farm Income

Averaging across all the main farm systems, family farm income in 2026 is forecast to fall to approximately €33,600, down 38% on the €53,800 average for 2025. This mainly reflects the combination of lower dairy, cattle and tillage farm incomes. All income figures include support payments.

A report on the latest Teagasc Outlook 2026 farm income estimates is available to view and download here

Table 1: Average Farm Incomes 2022 to 2025 and Income Forecast for 2026

Farm System	2022	2023	2024	2025	2026	’26 v ’25	’26 v ’25
	€	€	€	€	€	% change	€ change
Dairy	157,591	51,122	108,536	153,319	78,000	-49%	-75,319
Cattle Rearing	8,767	6,996	13,862	24,061	19,000	-21%	-5,061
Cattle Other	18,097	13,737	18,141	32,798	21,000	-36%	-11,798
Sheep	16,086	12,953	27,449	29,344	26,500	-10%	-2,844
Tillage	73,523	19,280	41,391	54,916	44,000	-20%	-10,916
Average	46,313	19,281	36,234	53,842	34,000	-38%	-20,242

Source: Teagasc National Farm Survey from 2022 to 2025 and report authors’ estimates for 2026

Table 2: 5 year average income (2021-2025) and Income Forecast for 2026

Farm System	Five Year Average 2021-2025	2026f	2026f v 5yr average	2026f v 5yr average
	€	€	% change	€ change
Dairy	114,690	78,000	-32%	-36,690
Cattle Rearing	12,921	19,000	47%	6,079
Cattle Other	20,008	21,000	5%	992
Sheep	21,298	26,500	36%	5,202
Tillage	49,061	44,000	-10%	-5,061
Average	38,200	33,600	-11%	-4,600

Source: Teagasc National Farm Survey from 2022 to 2025 and report authors’ estimates for 2026