Last week, I attended a conference organised by the National Rural Network, on the potential of farm partnerships.
The conference was attended by representatives from ICMSA, ICSA, IFA and Macra, as well as participants from Teagasc, the Department of Agriculture and the National Rural Network. The most important people in the room were farmers who had real hands-on experience, each of whom was a member of at least one partnership structure.
The concept of farm partnership is not new, many of us have heard of milk production partnerships (MPPs), in which the key incentives include access to quota.
The reality on the ground is that formal partnerships are a relatively rare feature of Irish agriculture, with just 544 MPPs registered in the country, which is less than 4% of all dairy farmers.
The number of farm partnerships between non-related partners is a fraction of this. Outside of dairying the percentage involved in farm partnerships is even lower. Of course, there are plenty of husband/wife farming partnerships, but the slant of the conference was not overly concerned with the form of partnership.
Two broad areas were explored:
nintra-family partnerships, involving different generations of the one family, and ninter-family partnerships, where two individual non-related farmers come together to farm in partnership.
The concept of partnership is wide, and can include neighbours or farmers who are not even in the same parish, it can include farmers in the same sector, and even farmers in different sectors.
At a very basic level, it covers all types of situations where farmers work together. The milk production partnership is just one example, at the formal end of the scale, of what is available in terms of partnerships. So why all this talk of partnerships? They offer some advantages over the traditional model of working in isolation. It’s possible to achieve greater efficiencies of scale, a sharing of workload, a sharing of machinery, a pooling of resources, better utilisation of agricultural assets and a sharing of knowledge and experience. The end goal is to achieve the same or even better financial returns, with a better work life balance, than are available where each farmer operates independently.
The typical partnership agreement involves each farmer retaining ownership of their own individual assets, but coming together to work those assets.
Take a farmer who may want to step back from the full-on workload of dairy farming, partnership offers him the advantage of fully utilising his land, where he can team up with a local dairy farmer who may be interested in extending his grazing platform. Or it can still be a perfect match in a contract rearing and silage ground system.
The returns available to this farmer should be even higher than a traditional scenario where a farmer ceases dairy farming and instead keeps cattle.
One clear message from the conference was that partnership was not about forcing out older farmers, but rather providing options to farmers who may wish to work with other farmers, and who may be interested in getting the most from their land.
There was valid apprehension felt by a number of farmers about the future of partnerships after milk quotas go, given that the current regime offered a significant advantage to farm partnerships through access to quota.
It was recognised that the development of MPPs has paved the way, and cleared the majority of obstacles that previously existed within the Department of Agriculture and within Revenue. However, it was strongly recommended that all remaining discrepancies are removed, and it will become so much easier to promote partnerships, when they are on a level footing.
There should be a greater promotion of partnerships, with suggestions of open or model partnership farms, promotion at discussion group level, identification at advisor level of those suitable for partnership, templated documents, an A-Z guide, as well as an education and accreditation programme for professionals involved.
I highly recommend all persons involved in farming review the report on "The Potential of Farm Partnerships" which was published earlier this year and is available online at www.nrn.ie/wp-content/uploads/2012/04/Final_SIWG-3_Potential-for-Farm-Partnerships1.pdf