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Investment, Borrowings and Interest in Agriculture

Gross fixed capital formation, or capital investment, in agriculture experienced a dramatic collapse in 2009 having climbed to record highs in the preceding years. Most of the decrease was attributable to investment in farm buildings which, based on CSO data, reached a record level of €1,312 million in 2008, up 105% on 2007) only to drop by 88% to €153m in 2009. However, it should be noted that the increase in investment in farm buildings in 2007/8 was largely attributable to the Farm Waste Management Scheme, with one of the criteria of the scheme being that all building work had to be completed by the end of 2008. That said, investment in land improvements showed a similar percentage drop, with agricultural machinery and equipment experiencing lesser but still substantial decreases. The overall decrease in capital investment in agriculture, excluding breeding stock, was just short of 80%.

Figure4.4 

Figure4.5 

In the 12 months to June 2010, there was a 10% decrease in total borrowings by the agriculture and forestry sector.  However the results for June 2010 did show the first quarterly increase in the amount borrowed since March 2009. Meanwhile, interest paid by the agriculture sector declined by 17% to €272 million between 2009 and 2010.

Table4.5 

Figure4.6