A 3.5 per cent increase in agricultural income for 2004 represents a slight improvement in the situation of farmers, IFA President John Dillon said today.
New figures from the Central Statistics Office showed farming income increased by €76 million last year compared to 2003.
But Mr Dillon insisted the agriculture sector was facing some tough challenges in the remainder of the year.
"WTO trade talks in December will be critical for farmers' incomes in the years ahead. The outcome of the talks in Doha will be closely watched by farmers who are finding it increasingly difficult to maintain margins," he said.
"Already there is pressure on milk prices and declining returns for cattle producers."
The CSO figures also showed an 8 per cent increase in the cost of energy for 2004, and Mr Dillon said fuel prices continue to rise, putting incomes under threat.