New figures released in the annual Bord Bia Export Performance and Prospects report 2020/2021 show that the value of exports of Irish food, drink and horticulture were held to a marginal 2% decline in 2020, valued at €13 billion (v €13.2 billion in 2019), during a period of unprecedented change and challenge that saw the largest disruption to normal market operation, globally, since the end of World War II.
The figures underline the dividend of a decade-long diversification strategy that has seen Ireland achieve a broad global base for its food and drink exports which now reach in excess of 180 countries. Increases have been recorded in the value of Irish dairy, pigmeat and sheepmeat exports, along with very significant increases in the value of exports to Africa and the Middle East as new international markets come to the fore.
Launching the report today the Minister for Agriculture, Food and the Marine, Charlie McConalogue, T.D., said: “Ireland’s food and drink producers faced many challenges on the domestic and international front last year arising from the economic impacts of the pandemic, closures of food service and changes in consumer behavior. Despite this, they found a new level of resilience that saw exports in 2020 of close to 2019 levels.
Total agri-food exports, including non-edible products not included in Bord Bia data, are estimated by my Department at €14.3 billion in 2020, compared to €14.5 billion the previous year. I pay particular tribute to our farmers as well as our food and drink producers for their heroic efforts in supporting a balanced economy in 2020 despite dealing with a once-in-a-lifetime global pandemic.
“In 2021, my Department, along with Bord Bia, will focus on supporting our primary producers and manufacturers as they trade through continued uncertainty to support jobs and communities throughout Ireland.”
Minister of State with special responsibility for Market Development, Martin Heydon, T.D., stated, “Our enhanced focus on market development is a key part of my Department’s response to the twin challenges of the economic impact of Covid-19 and Brexit. Now more than ever we need to build upon what has been achieved to date, and work to secure new market opportunities for Irish food exports, for the benefit of our farmers and agri-food business. I look forward to working with Bord Bia on a series of market development and promotion events, and Trade Missions, to key international and European markets during 2021 to further increase Irish food and drink exports.”
Meanwhile, the Chief Executive of Bord Bia, Tara McCarthy, added: “Behind the remarkable export performance of our food and drink sector in 2020 are seismic challenges at a strategic, category and channel level. Last year was a pivotal year of learning for us all and 2021 will be even more significant in terms of how we apply these learnings to rebuild and drive growth in new and emerging markets. The success of the industry’s transition to doing business virtually – from participation at online trade fairs to the development pioneering virtual trade missions – show that we can, and we will, rise to the challenge of doing business in new and inventive ways. This resourceful approach, coupled with the sectors’ focus on geographic and customer diversification over the past decade has now paid dividends and is integral to safeguarding our exports.”
Export Destinations – the Diversification Dividend
The success of the diversification strategy of the Irish food and drink industry is evidenced by reduced dependence on the UK market and increased geographic spread of exports, particularly since the Brexit referendum in 2016. In the period since the UK voted to leave the EU in 2016, Ireland’s global exports of food and drink grew by over €1.9 billion, a 16% increase in value.
Exporters have been expanding the value of exports while increasing the proportion of those exports that are destined for high-growth, high-potential priority markets, largely in Asia but also in the Middle East, Africa and North America. The majority of growth since 2016 (€1.9 billion) comes from the EU27 (46% or €871 million) and international markets (43% or €817 million). The UK accounted for just 10% of growth (€195 million) since 2016.
Since 2016, the value of Irish food and drink exports to Asia has increased 14% to €1.4 billion. Exports to Africa over the same period have increased by a significant 86% to €883 million in value, while continental Europe (EU27) grew by 25% to €4.4 billion.
In 2020, 33% of Ireland’s total food and drink exports were destined for International markets outside the UK and EU, while 34% were destined to the EU27 and 33% to the UK.
Outlook & Prospects for Irish Food and Drink Exports in 2021:
Commenting on the outlook for 2021, Ms. McCarthy concluded: “For Irish food and drink producers, the global supply demand dynamic for their produce remains positive in 2021 despite global challenges and continued uncertainty as we navigate Brexit and our fragile exit from the pandemic. As we start 2021, exporters are reporting solid order volumes which is a direct result of the strength of trading relationships nurtured over many years. That said, the extra costs and complexities of trade with our largest destination market, as new customs procedures interrupt the smooth flow of produce, will cause significant challenges and should not be underestimated.
With a return to global economic growth forecast for 2021, we anticipate continued strong global demand for Irish dairy. We expect the global meat supply balance to favour producers, particularly in Asia which has been at the centre of much Irish export growth. All around the world consumers and customers are increasingly demanding credentials around sustainability that Ireland is well-placed to meet as we seek to differentiate ourselves from competitor exporting nations and to navigate gastro-nationalism in key markets. Our action plans, programmes and priorities for 2021 and beyond are centred on value creation for the full supply chain – from farm to fork. With Bord Bia’s insight driven support, we remain focussed on partnering with this vibrant and resilient sector to pursue global growth in a very different world.”
See sectoral Analysis