Darragh McCullough: The price of peace for Irish farmers – it will be much harder for us when Putin finally pulls out of Ukraine

It was another poignant reminder as we ate and drank our fill over the festive period that all is not well on Europe’s Eastern Front.

When Vladimir Putin launched his invasion of Ukraine nearly 11 months ago, and less than six weeks later his troops began a hasty retreat from the outskirts of Kyiv, I thought this was going to be a mercifully short war in which Russia’s dictator simply be would run out of money or support for the multi-billion dollar invasion.

Instead, it now looks like both sides are dug in, with neither showing signs of backing down.

Putin’s army continues to kill Ukrainians with every new wave of missiles he sends, and the Ukrainians continue to prevent his troops from taking more territory.

But something becomes clear. Putin will never take control of Ukraine. Instead, he has cemented ties that will bind Ukraine to Europe. The war has also forced the EU to address its dependence on foreign fossil fuel regimes.

What does this mean for Irish farmers? It aims to open up real opportunities for renewable energy in the form of biodigesters, biomass and solar energy.

It has also queued a country almost eight times the size of Ireland to join the EU. According to the USDA, an estimated 8.3 million households are engaged in agriculture in Ukraine.

Compare that to the 10.3 million farming households that make up the EU’s farming base. Integrating such a vast agricultural country into the existing CAP structures would be a mammoth task that would inevitably dilute the pot for Irish farmers.

But implementation could take decades. Once the war ends, which it will, grain and fertilizer will flow more freely. Who knows how quickly prices will fall, but they will.

Lower grain prices will impact meat, dairy and poultry products, which have reached sky-high levels over the last year.

However, runaway inflation, which has pushed up all farm-level costs over the past year, will not reverse. I can’t imagine the cost of machinery, labor, drugs and sprays going down any time soon, so the overall cost base of production here has irrevocably moved up.

The other big input cost that has gained a foothold in recent months is land. Whether you rent, lease or buy, property prices in Ireland have gone up about 50 per cent in the last two years from what I can see.

This is being driven by the strong returns that dairy and tillage have produced over the past few years, coupled with a strong underlying economy that has no shortage of investors keen on a slice of Aulsode.

How much will that change when there is finally a peace agreement between the Russians and the Ukrainians?

Or look even further to China, where some believe the next Bear Stearns bank is just waiting to fail. Perhaps it is a Chinese invasion of Taiwan, destroying the global microchip supply chain, that will trigger the next crisis? Maybe another pandemic is just around the corner?

Of course, it is pointless to question all these possibilities. But one family history anecdote that was recalled during Christmas turkey was the impact the end of World War II had on my grandfather’s ability to pay for his new farm.

I had always understood that record grain harvests combined with high prices in the post-war years had enabled him to pay for a farm twice the size of the one he left.

But it turns out he’s benefited from his land business, too. In the 12 months between 1945 when he bought Elmgrove Farm and 1946 when he finally sold his original farm at Monasterboice, land prices nearly doubled.

After five years of war that had devastated Europe and claimed the lives of up to 60 million people, confidence and hope suddenly surged through the veins of every western economy.

I see the same for property values ​​in vast tracts of land across Eastern Europe in the coming years, but Ireland’s already heated property market is likely to fall in value rather than rise further.

Dairy and tillage just had a record year that only happens once in a generation. Lower producer prices combined with a higher input cost base are a likely scenario for these sectors in the coming years.

Fortune favors the brave, but discretion is the better part of bravery. Tread carefully!

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Darragh McCullough runs a mixed farming business in Meath, elmgrovefarm.ie