Statistics released by The Central Bank this afternoon show agriculture continues to comprise the largest share of gross new lending in the SME sector.

According to the update, some €399m was drawn down by the SME sector, €119m of which was in agriculture, with the wholesale/retail sector at €90m in new lending.

According to Dr Ailish Byrne, senior agricultural manager with Ulster Bank, dairy expansion, land transfer and pig farm investment is driving this lending.

Speaking to AgriLand, she said: "We are seeing a lot of activity in land purchases. Also with dairy farmers looking to expand, to expand their herd sizes, milking parlours and infrastructural improvements such as roadways. People are putting in a lot of works. There has also been significant requests regarding working capital facilities, for example supporting dairy herd replacements."

In terms of new entrants, the senior agricultural manager noted a significant uptake in lending.

"Many farmers are also converting from beef and suckler to dairy, so they are looking at finance requirements regarding new buildings, calving sheds, money to upgrade grazing platforms and so on."

Byrne has also noted an big increase in lending to pig farmers, mainly due, she strongly suspects, to the new loose dry sow housing regulations. "Most of this finance was approved in this quarter and has been drawn down," she added.

In terms of lending for dry stock, sheep and the suckler beef sector in quarter three, Byrne noted annual stocking and working capital lending to facilitate day-to-day expenses with no significant surges.

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