Sharp drop in value and volume of dairy exports to the UK

According to figures provided by the Central Statistics Office, the value and volume of our dairy exports to the UK were hit very hard in the first nine months of 2016. They fell from €730.8m (306,470t) in 2015 to €620.7m (251,563t) in 2016.

As for beef, the value of our exports to the UK fell by 2% in the same period.

However, we shipped more beef to the UK this year, as the volume in the same period rose by 6%. Our cattle kill this year is now estimated to end the year close to 1.64m head, which would be up around 80,000 on 2015. In the year to mid-November, according to figures from Bord Bia, supplies are currently running around 5% ahead on the year, which equates to 68,500 head.

We also shipped more fruit and vegetables to the UK in 2016

The story for sheepmeat was an improvement on beef and dairy, as exports to the UK in the first nine months of this year rose by 17.5% in value and 15% in volume. This rise is linked to the drop-off in New Zealand lamb production this year.

We also shipped more fruit and vegetables to the UK in 2016: 128,479t this year compared to 107,563t last year – an increase of 19%. The value of these products, however, fell marginally, going from €183.8m in 2015 to €182.3 in 2016.

Brexit

The Brexit vote on 23 June 2016 had much to do with the drop in the value of dairy exports in 2016, as sterling rapidly depreciated in the wake of the vote. Almost 30% of our exports go to the UK, the majority of this is made up of cheddar cheese. Moreover, dairy prices were down across the board this year and global milk production increased by 3.9% in the first quarter of 2016, according to the European Commission, meaning there was greater supply with similar demand.

It was the same story for the value of Irish beef exports. Even before the Brexit vote, the exchange rate was more hostile than 2015 when the rate was exceptionally favourable for Irish beef exports. Around 50% of our beef exports go to the UK every year.

It was a different story for Northern Ireland, however, as they trade within the same currency zone as Great Britain.

Irish mushroom exporters are almost totally dependent on the UK market

The small drop in the value of fruit and vegetables is not surprising, as mushrooms come under this category and 80% of our mushrooms go to the UK each year, meaning Irish mushroom exporters are almost totally dependent on the UK market.

Mushroom growers negotiate their contracts in sterling and have slim margins to begin with, so the weakening of sterling has had a devastating impact on their businesses.

Since the Brexit vote, four mushroom farms have gone to the wall and over 150 jobs have been lost.

Value of our food and drink exports

In 2015, the value of Irish food and drink exports worldwide rose by 3% to €10.8bn. In 2015, before the Brexit vote, Bord Bia predicted that 41% of Irish food and drink exports would go to the UK in 2016, valued at €4.4bn.

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