Firstly, John gives a view on the current agri-sector outlook from a banking perspective. On the supply side, he acknowledges that milk production across the world is up year-on-year in 2020 while the supermarket consumption of dairy products has not compensated for the significant drop in demand food service industry.

In terms of family farm incomes, Patrick explains the many dynamics at play including a reduction in milk price, potential loss of off-farm income and increased costs resulting from the current drought conditions.

John emphasises that the banks are open and willing to help farmers, offering increased overdraft facilities, interest-only loans and payment breaks including Agriflex which extend for up to 12 months.

Patrick recommends that farmers firstly establish the cashflow situation for the farm, establishing the revenue for milk and stock sales for the year as well as the costs incurred. 

Looking to the remaining 7 months of 2020, Patrick recommends looking back to 2019 costs to get an accurate picture of costs for the business.

Both Patrick and John recommend that farmers should act fast to deal with any potential shortfalls in cash and re-iterated that there is help available within Teagasc and from your bank.

For more information:

https://www.teagasc.ie/media/website/publications/2018/Cash-Flow-and-Financial-Management-on-Dairy-Farms.pdf

For more episodes from the Dairy Edge podcast go to the show page at:
 https://www.teagasc.ie/animals/dairy/the-dairy-edge-podcast/