Bad news for Kilkenny farms - incomes set to fall as milk and cattle prices ease
The outlook for farm incomes in 2026 is weaker than that recorded in 2025, according to a new report from Teagasc.
The warning comes as the farm organisation’s economists review the current position in agricultural output and input markets and assess prospects for Irish farm incomes this year.
As of mid-2026, the outlook for the global economy remains a concern.
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
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.
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%.
Cattle Rearing
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.
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.
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 at https://teagasc.ie/publications.