Category Archives: Irish agriculture

9/10/15: Subsidies and Irish Agriculture: 2014 Data

Per latest data from CSO, Net Subsidies accounted for 59.6% of agricultural income in Ireland in 2014, ranging from 105.3% in the Midlands to 40.6% in South-West.

High as a kite on subsidies, Irish agriculture nonetheless managed to improve, thanks in part to lower euro valuations, its value added relative to subsidies. In 2012 net subsidies counted for 72.1% of total operating surplus (or income) in the sector, falling to 63.4% in 2013.

Key computational definition here are for GVA (Gross Value Added) and Operating Surplus (Income):

GVA at basic prices = Agricultural Output at basic prices – Intermediate consumption
Operating Surplus =    GVA at basic prices – Compensation of employees
                              –  Fixed capital consumption
                              + Other subsidies less taxes on production

Net value added in Irish agriculture in 2014 was EUR1.463 billion, up on EUR1.316 billion in 2013.

For the politicians claiming immense importance of the sector to Ireland, a quick reality check: Gross Value Added (which includes all labour inputs and capital spending in the sector, as well as subsidies net of taxes) stood at EUR2.192 billion in 2014.

And of that, subsidies accounted for 69.4 percent of total Gross Value Added - more than 2/3rds of Irish Agricultural Value Added came via a cheque from Europe, not from customers buying the goods.

In fact, claims about Irish Agricultural Sector contribution to the economy are often wildly off the mark. Per CSO data, the highest metric of this sector activity - Agricultural Output at Basic Prices is EUR7.328 billion for the entire 2014 and of these 20% (one fifth) were net subsidies.

2/3/15: EU Exporters: No More Than 20-30% Will Return to Russian Markets

A very interesting note reporting comments by Russia's head of Rosselkhoznadzor (organisation that certifies food imports and grants food market access to foreign exporters) on the post-sanctions regime for Western exporters into Russia. The full text is here: in Russia.

The core point is that head of Rosselkhoznadzor expects the return of just 20-30% of EU exporters back to the Russian market once Russian sanctions on food imports are lifted. And that is 20-30% "at most". Quoting from Interfax report, the head of Rosselkhoznadzor thinks that "Products from the EU will find it difficult to return to Russian markets, because we will be forced to cut back on the number of European producers, allowing only 20-30% of previously active suppliers back into the market. The rest will be able to supply [exports to Russia] only after they restore [market] trust".

In another report (, President Putin's press secretary stated today that Moscow is considering allowing imports of agricultural raw materials that serve as inputs for production of food in Russia, as long as actual production takes place in Russia. The statement relates to the President Putin's promise made in Budapest last month that Russia can expand cooperation with Hungary in food trade. According to the press secretary statement, this can only be done by relaxing sectoral restrictions as Hungary (or any other country) cannot be privileged in trade relations with the EU under the WTO rules.