We are reconcreting for the second time in the last 12 months.
Since then, concrete has increased by 10 percent, labor costs for pouring and leveling have increased by 20 percent, and the steel we use for reinforcement has increased by almost 50 percent.
But all of these increases are dwarfed by the inflation taking place in everyday agricultural inputs and outputs.
With fertilizer prices tripling, many farmers are coming to terms with their grief over the new cost reality.
First, it was denied that these new insane prices could actually last into 2022. Then there was the anger that such an important input could skyrocket by 300 percent in a year if every farmer had considered a 30 percent increase in milk, meat or grain, which was a godsend.
There followed some tentative negotiations with the local supplier to see if we were all just being pissed off. After that came the depressed realization that this really was the new norm.
But just as we completed our acceptance and were preparing to book €10,000 worth of fertilizer (that’s only half a truck!), Putin began the warpath.
Suddenly it was no longer a question of whether we could afford the prices. It was more about whether there would be fertilizer when we called the dealer.
Luckily we’re part of a buying group and it looks like our order is safe, but I’ll breathe easier when it’s finally in my garden.
With prices so volatile right now, fortunes will be made and lost in the coming months.
It’s going to be a difficult time that the risk-takers will enjoy while the rest of us shave a few years off our life expectancy and grapple with whether to sell or buy.
One of the biggest risks I’ve taken in the last year was parting with a supermarket I’d supplied daffodils to for almost 20 years.
As one of the largest supermarket chains in the country, it was an annual order that my business literally grew up with.
The first year we almost had a heart attack trying to unwrap 500,000 stems in a single week.
Today we unwrap 500,000 stems every other day without breaking a sweat. Although margins have always been razor thin, I firmly believed that unless we scaled up and looked to volume contracts, we would never generate enough revenue to invest in the necessary facilities and equipment.
It has served us well over the years and has allowed me to build a system that produces daffodils as cheaply as anyone else on the planet.
We’ve only ever pushed for a price increase of one percent per year, knowing that if we went too far, we’d be priced out of business.
So it felt like a little kick in the teeth when we were told two years ago that we would lose half the contract if we weren’t willing to drop our prices by over 15 percent.
We persevered and lost half the business to another Irish supplier. It was a calculated gamble, knowing that there were export customers willing to pay the same price or more, and that these customers offered me the potential to increase my output even further.
One of the biggest mental blocks was the idea that if you had a fight with an Irish customer, you could still get in your car to meet them and beat them up.
But things went well with the new export customer and when the Irish supermarket called again last year asking for the same discount I was confident they had a viable alternative.
Once again I refused to drop my prices and was summarily dropped from the supply chain. There was no email or phone call from the affected dealer. Unfortunately, this is the gig. I’m just one of the lucky ones who had viable alternatives.
My heart really goes out to the Irish vegetable growers who I see giving up because they just couldn’t get the supermarkets to budge on the price.
I was that grower back then when we grew over 100 acres of onions and now my daffodils still end up in supermarket chains, except this time in Eastern Europe and Scandinavia.
However, the main difference between me and an Irish cabbage grower is that Ireland has a natural competitive advantage over the rest of Europe when it comes to growing daffodils.
It will take another month for them to grow in Poland, while further south in the Mediterranean it is too hot. It’s one of those rare things that we can do better here than almost anywhere else in the world.
While it’s good on paper to specialize only in farming systems where we’re world champions, it offers a future outlook for a very undiversified farming sector.
That’s exactly what environmentalists are telling us to avoid.
As always, Irish consumers will have to vote with their feet and their wallets if they want something different.
Darragh McCullough runs a mixed farm in Meath, elmgrovefarm.ie
https://www.independent.ie/business/farming/comment/darragh-mccullough-why-i-refused-to-drop-my-prices-again-even-if-it-meant-being-dropped-by-a-supermarket-41414340.html Darragh McCullough: Why I refused to lower my prices again, even if it meant being dumped by a supermarket