asked the Minister for Agriculture and Food, taking into account the increase in levies, the reduction in VAT refunds, the reduction in the level of grants, and the increase in taxation, together with the reduction in milk quotas, the way in which he can support the statement in his Estimates speech, that farm incomes are expected to grow by 8 per cent this year; and if he will make a statement on the matter.
Written Answers. - Farm Incomes.
43.
The expected increase in farm incomes this year arises from a reversion of the price-cost squeeze which has strangled profitability in Irish agriculture in the recent past and a drop in volume of farm inputs particularly feedingstuffs. The latest monthly agricultural price indexes for March 1987 published by the Central Statistics Office show agricultural output prices up by 1.3 per cent and agricultural input prices down by 6.4 per cent over the corresponding month in 1986. Sales of animal feedingstuffs increased by over 17 per cent in 1986 because of the poor weather and it is expected that they will decline significantly this year. These factors underline the projections by the Central Bank that, assuming a return to normal weather conditions this year, the outlook is for a recovery in farm incomes of the order of some 8 per cent.