Farm Incomes Set to Rise Again in 2025 Despite Global Uncertainty
Irish farmers are on course for another year of income growth, according to the latest Situation and Outlook for Irish Agriculture July 2025 published by the Agricultural Economics & Farm Surveys Department at Teagasc.
By John Galvin
Despite a more uncertain global economic backdrop, the combination of strong output prices, favourable weather, and stable input costs is expected to deliver significant income gains across most farm systems.
The report, highlights that average farm income is forecast to reach €48,500 in 2025—an increase of 39% on the 2024 figure. This follows a strong recovery in 2024 and reflects continued momentum in dairy and drystock sectors.
Farm Inputs
Feed prices are expected to be down by around 4% compared to 2024, while fuel costs are forecast to fall by approximately 3%. Electricity prices have remained stable.
However, fertiliser costs have bucked the trend. Prices in the first half of the year were up about 5% on the same period in 2024. Despite this, fertiliser usage is expected to increase, driven by improved profitability in grassland systems and more favourable pricing compared to the highs of 2022 and 2023.
Overall, production costs are broadly in line with 2024 levels, though there is some variation between systems. Feed use in grassland systems is expected to remain unchanged from last year.
Weather Conditions
During the first half of 2025 have been excellent. Grass growth has been strong, and tillage farmers have benefited from favourable planting conditions for both winter and spring crops. These conditions are contributing to improved yields across the board.
Dairy
Dairy commodity prices entered 2025 at a high level and have remained strong. Milk prices are expected to average about 7% higher than in 2024. Combined with favourable weather and stable input costs, this is expected to drive a 5% increase in milk production.
As a result, the average dairy farm income is forecast to reach €140,000 in 2025—a 30% increase on the previous year. This follows a dramatic 119% increase in income from 2023 to 2024, when average income rose from €49,432 to €108,189.
Beef
Cattle farmers are also set to benefit from strong market conditions. Prices for finished cattle have risen sharply, with an increase of over 35% expected compared to 2024. Weanling prices have also surged, up by approximately 45%.With input costs largely stable, these price improvements are translating into substantial income gains. Cattle rearing farms are forecast to see average incomes rise by 85% to €25,000 in 2025. This follows an 83% increase in 2024. Cattle finishing farms are expected to see incomes rise by 44% to €26,000.
Support payments through schemes such as ACRES and the Organic Farming Scheme continue to play a key role in boosting incomes in the cattle sector.
Sheep
Sheep farmers are also expected to see income growth in 2025, though at a more modest rate. Lamb prices are forecast to be 8% higher than in 2024. While production costs have edged up slightly, support under the Sheep Welfare Scheme, ACRES, and the Organic Farming Scheme will help maintain margins. Average income on sheep farms is forecast to reach just under €34,000 in 2025, representing a 22% increase on the previous year. Some of this growth is attributed to secondary cattle enterprises on mixed farms, which have benefited from the strong cattle market.
Tillage
The crops sector is facing lower cereal prices in 2025, but this is being offset by higher yields and stable input costs. Early harvest indicators suggest that production volumes will be up, thanks to good planting conditions earlier in the year. The average income on tillage farms is forecast to rise by 12% to €43,000. While this is a positive development, it still falls below the five-year average for the sector. Much of the income growth is being driven by subsidiary livestock enterprises, which have benefited from higher prices in 2025.
Conclusion
The average income across all farm systems is projected to reach €48,500 in 2025. This represents a 39% increase on 2024 and an 82% increase on 2023, when average income stood at €19,204.
The income growth is broad-based, with all major systems—dairy, cattle, sheep, and tillage—expected to post gains. The strongest growth is in the cattle rearing and dairy sectors, reflecting both market conditions and improved productivity.
While this positive news for Irish farmers Income is very welcome it must be conditioned with reality. The facts are that in 2024 direct payments accounted for over 100% of the farm income on the majority of Irish Drystock farms (cattle & sheep) and only a mere 30% of cattle farms were classified as viable in the same year. On the dairy side, with income less reliant on direct payments thus leaving them more exposed to market pressures, be they positive or negative, coupled with a greater level of debt (148k) due to on farm investment the priorities must be to have a sufficient fund in place for running the farm through the leaner winter months, hedging away a rainy day/year fund, reduce the farm debt, focusing capital investment on energy, farm efficiency and labour efficiency.
While the income outlook is positive, Teagasc economists caution that global economic uncertainty remains a risk. Geopolitical tensions, trade disruptions, and currency fluctuations could all impact commodity markets in the second half of the year.
Nonetheless, the fundamentals for Irish agriculture remain strong. Stable input costs, favourable weather, and robust support schemes are providing a solid foundation for continued growth.
Farmers are advised to remain vigilant, manage costs carefully, and take advantage of advisory services and support schemes to maximise resilience and profitability.
| 2023 | 2024 | 2025 | 2024 vs 2023 | 2025 vs 2024 | |
| € | € | € | % | % | |
| Dairy | 49,432 | 108,189 | 141,000 | 119% | 30% |
| Cattle rearing | 7,425 | 13,547 | 25,000 | 83% | 85% |
| Cattle other | 14,735 | 18,101 | 26,000 | 23% | 44% |
| Sheep | 12,625 | 27,796 | 34,000 | 120% | 22% |
| Tillage | 21,398 | 38,685 | 43,000 | 81% | 12% |
| Average | 19,204 | 34,984 | 48,500 | 82% | 39% |