Irish food and drink exports recorded a robust performance in 2005 in what was a challenging trading environment according to Bord Bia's Export Performance & Prospects 2005 / 2006 report, launched today. The value of exports is estimated to have increased by 0.7% to €7.1bn despite a strong euro exchange rate against sterling and price deflation in major export markets.
Agriculture and food remains Ireland's largest indigenous exporter providing total employment in the order of 160,000. It accounts for close to one tenth of the Irish economy with annual sales of €18.5 billion and relatively low import content.
Commenting on the export performance in 2005 Aidan Cotter, Chief Executive, Bord Bia said; "Irish food and drink exports held up remarkably well in what was an extremely tough and competitive environment. The challenge facing Irish food and drink exporters in 2006 will be to continue to invest in the development of new products and routes to market which will allow them to compete successfully in what are likely to remain difficult trading conditions. Bord Bia is committed to working with Irish food and drink companies to differentiate themselves in the marketplace and thereby enable them to exploit the opportunities that are part of a dynamic and fast-changing market."
The 2005 export performances by sector are as follows:
Beverage exports recovered strongly and were the best performing export category in 2005. Total exports from the sector are estimated to have grown by 5.8% to over €1 billion. Cider, beer, spirits and water exports were all up in 2005. Investment in leveraging distribution, innovation and branding will remain key to driving growth in 2006.
Meat and livestock exports grew by 2% to €2.1 billion in 2005, representing 30% of the total value of Irish food and drink exports. Beef exports, which account for two thirds of total meat and livestock exports, experienced a small increase. However, beef exports to Continental EU markets were up 11% reflecting a successful shift to supplying this market with premium produce rather than supplying commodity international markets. Exports of pork and bacon, and of live animals increased while the value of lamb exports declined.
Prepared food exports stabilised in 2005 at €1.5 billion, following a strong performance in the previous year. The sector, which has the highest long-term growth potential for the Irish food industry, had to cope with strong downward price pressures, increased price promotional activity, and growing competition from mainland European suppliers in its largest market, the UK. Further retail consolidation during the year has accentuated competition in the UK retail sector while growth in grocery sales has also moderated from previous years.
Dairy exports fell by 2% to €1.82 billion in 2005. However, strong world dairy markets helped contain the decline in the value of dairy product exports, which was due primarily to lower rates of casein aid and refunds. The prospects for exporters appear more challenging in 2006 due to an expected weakening in world markets as supplies from Australia and New Zealand are set to increase.
Bord Bia has planned an active promotion programme designed to showcase the Irish food and drink industry to foreign buyers in 2006 and is continuing to reposition itself to match the opportunities and needs of industry. The promotion programme includes the organisation's hosting of the International Speciality Food Forum, which will be held in Dublin in May, and the sponsorship of the Ryder Cup in September of this year.
Bord Bia will also be conducting marketing and promotion campaigns in all of our major export markets, participating in all of the major international food and drink exhibitions, and working with individual Irish food and drink exporting companies to maximise their success in overseas markets in 2006.