Profitability of Organic Farming Systems

Summary

The majority of the farmers I meet, that are interested in organic farming are financially driven. It is important that the message on financial returns from organic farming is clear.
In cattle production systems when we look at the figures, the majority of cattle farmers are making a positive gross margin but are spending some of the premia cheque to cover fixed costs. In the organic situation costs are generally lower but so is gross output. The net margin delivered on organic beef farms is on average higher than the average beef farmer. The targets I have set on the paper that I believe are achievable on the majority of organic beef farms and should be profitable enterprises.
When the financial analysis is completed on organic dairy farms, it must be noted that when measured in net margin achieved per litre or per cow the results are as good as the best dairy farmers in the country, however the key issue is stocking rate. Only dairy farmers stocked up to about 1.7 livestock units per hectare will increase net margin. Farms stocked higher than this will loose out unless the milk price gap widens significantly.
In the tillage sector my colleagues produce crop budgets each year, last year the budgets went out the window as harvest returns disastrous due to the weather. The organic tillage budget produced in the paper shows excellent returns for organic tillage crops. The cost of imports and lack of supply is keeping the price up, the weakening of sterling may have an effect later on, however even if organic grain prices drop significantly, the returns are mush better than conventional tillage. This is an option Irish tillage farmers should be exploring.