The value of Irish agri-food and drink exports surpassed €11 billion for the first time ever in 2016, Minister for Agriculture Michael Creed recently announced.
It was the seventh subsequent year of growth, with an increase of 2%, to reach €11.5 billion. Prepared foods were the healthiest sector, increasing by 9%, to €1.92 billion, followed by beverages (€1.4 billion, +4%), and, finally, dairy products and ingredients (€3.38 billion, +2%). Other profitable exports in 2016 included sheep meat and pork.
“One of the notable features of this achievement is the impact of market diversification in the year in which the UK decided to leave the European Union. While trade with the UK fell by 8%, triggered by challenging exchange rates, uncertainty arising from Brexit and further competitive pressures, this was offset by increased exports to international and emerging markets such as North America (+€200 million, to reach €1.1 billion), China (+35%, to reach €845 million) and the rest of Asia (+6%, to reach €330 million)," said Creed.
Recovery in the continental EU was also seen, as exports increased 4%, to reach €3.5 billion, as better economic conditions helped demand. However, falling prices lowered the value of beef and 'edible horticulture' exports, while reduced volumes drove seafood exports down.
Bord Bia figures showed the negative effect of the weak, fluctuating sterling, with a reduction of potential trade by €570 million.
The negative effect of Brexit on the pound also demonstrated the importance of market access, finding market opportunities for value-added products, and continuing to sink funds into innovation and competitiveness, Creed commented. He added that the UK will remain a "critically important" market to Ireland, and that challenges and risk posed by Article 50 will need to be mitigated by proactive, collaborative actions on the part of government and industry.
Padraig Brennan, markets director for Bord Bia, mentioned that roughly 80% of total export growth last year was in trade to international markets. Since 2010, these markets have accounted for half of total export growth, he said.
Chinese exports have been particularly lucrative, growing sixfold in as many years, with exports to North America and the remainder of Asia doubling in the same period.
While export markets will continue to be challenging in 2017, increase in global dairy demand will continue, and there will be good potential for growth in the beverages sector. Increased beef-export supply may affect returns, while prepared-food exports will face intense competition, most likely from the UK.
Bord Bia calculates that Irish food and drink exports now reach more than 180 markets worldwide.
© 2017 European Supermarket Magazine – your source for the latest retail news. Article by Karen Henderson. To subscribe to ESM: The European Supermarket Magazine, click here.