Irish food and drink exports €13.5bn in 2021

Irish food and drink exports resumed their upward curve in 2021, reaching €13.5bn, according to Bord Bia’s annual Performance and Prospects report launched this week by Minister for Agriculture Charlie McConalogue.

The sector employed 163,600 people in 2021, 7% of total employment and represented 6% of modified gross national income (GNI).

Meat exports were up 4% to €3.544bn, with the biggest percentage increase in sheepmeat where the value was up 15% to €419,890m, despite less volume being exported.

Horticulture and cereals also performed strongly, up 14% to €270,921m, with mushrooms accounting for €151m.

Dairy exports were down slightly at €5.041bn, beef was up 9% to €2.1bn, pigmeat value fell by 3% to €541,973m and poultry was down 15% to €128,344.

Irish dairy exports topped €5bn, 1% lower than 2020 but with the volume of exports down 9%.

The UK took 18% of all dairy exports in 2021, reflecting a carryover of product from stockpiling in late 2020 in advance of Brexit. It remains a particularly important market for Irish cheese exports, taking over one-third of cheese exports which were up 15% to €1.059bn in 2021.

The next most important markets for Irish cheese in 2021 were Netherlands, Germany, the US and Japan, all taking between €50m and €100m.

Butter exports came in at just under €1bn at €997m, a 3% increase on 2020, driven by an increase in value of up to €2,000t, which more than offset the reduction in volume.

Netherlands was the biggest market, worth €350m, followed by the US on €210m.

It was another tough year for infant nutrition, with the value down 24% to €681.7m, on the lowest volumes in a decade. It was similar for fat-filled milk powder (FFMP), which was down 19% from 2020 at €667.6m.

However, casein performed particularly well with an export value of €467.5m, a 25% increase on the previous year, while whey exports also recorded a 25% increase to €254.5m.

Positive outlook

Bord Bia is positive about prospects for 2022 as milk output in Oceania and Europe is weaker and the belief is that many exporters have less product carrying forward. COVID-19 recovery and Chinese demand will also be key.

Prime beef exports increased in value by 9% to €2.1bn but the volume, including offal, fell 12% to 504,000t

At €880m. the UK share of Irish beef exports was 42% in 2021, significantly lower than the 51% in 2016. Volume to the UK was down 15% compared with 2020 at 214,000t carcase weight (CWE), partly explained by Brexit stock piling in late 2020.

The value of sales to the EU exceeded €1bn in 2021, 49% of total exports on a volume of 190,000t CWE. Exports to France were €212m, Netherlands €190m, Italy €170m and Germany €131m.

Outside Europe, China remains closed but sales to Hong Kong increased to €33m, while Philippines was the largest market at €46m in 2021, a 21% increase on the previous year.

The value of live cattle exports increased by 6% to €214m in 2021 underpinned by 72,249 head going to Northern Ireland.

The drop in cattle supplies of 6% in Ireland, combined with 4% less in the UK plus a further decline of 3% in EU imports on top of a 20% decline the previous year, meant demand exceeded supply in Ireland’s main export markets.

Bord Bia is “broadly positive” about the prospects for beef in 2022 as markets look to be relatively balanced between supply and demand. It predicts a 50,000 head increase in Irish cattle supplies over the course of the year.

Sheepmeat achieved record farmgate prices in 2021 and this is reflected in a 15% increase in the value of exports to €420m, despite a reduction in the volume exported to 69,000t. This is a fall of 9% on the previous year.

The EU, already a net importer of sheepmeat, also had a reduction in production of 1.5% and the deficit was increased further by a fall in UK exports to the EU of 22% in 2021.

New Zealand production remains stable but its continued increase in exports to China means there is less available for Europe.

Meanwhile, while Australian numbers continue rebuilding from drought, they are primarily focused on the US market, along with the Middle East and Asia including China.

This means the EU market was undersupplied in 2021 to the advantage of Irish sheep farmers.

Bord Bia is “largely positive” about the prospects for 2022, with continued growth in demand from China keeping the New Zealand and Australian focus away from Europe.

Also, progress has been made in opening the US and China markets, and while product isn’t flowing yet, these would give further options.

A cause for concern is that tight supply in Europe has meant reduced shelf space for lamb and this could be an issue at times of greater supply.

While the output from the Irish pigmeat sector increased by 3% to 248,000t, the value of exports fell 3% to €542m in 2021.

Farmgate prices were down 8% on the previous year at an average of €1.55/kg, falling sharply in the final months of 2021.

Asia was the main market in 2021, accounting for two-thirds of Irish pigmeat exports, while exports to Australia were €49m and the US €27m.

Bord Bia describes the outlook for 2022 as “uncertain” with much depending on China, the world’s largest importer and where domestic prices collapsed in 2021, though imports for 2022 are forecast to increase.

Irish primary poultry meat exports fell by 15% in 2021 to €128m.

Sales to the UK were down 16% to €74m, largely due to disruption in the food service market caused by COVID-19.

The other major blow in 2021 was the loss of the South African market due to the discovery of avian flu in late 2020.

Recovery

For 2022, recovery from COVID-19 would be a boost for the food service sector, a major outlet for Irish poultry meat, as would the reopening of South Africa, but rising feed costs will be a challenge.

Bord Bia’s Performance and Prospects is a review of Ireland’s food and drink exports that reflects a positive 2021.

It was a record year for sheepmeat prices, good for beef, though coming from a low base, and solid for dairy. It was tough for poultry producers and pig farmers where prices got worse as the year went on.

The strength of Bord Bia is its knowledge and understanding of international markets for Irish food and drink.

This is particularly valuable for small and developing export businesses though large dairy, meat and drinks companies will have greater knowledge of their markets through day-to-day business. For them, and the overall Irish food industry, Bord Bia provides a useful ambassadorial role promoting Ireland as an international food supplier.

Bord Bia is the filter through which global market knowledge flows back to Irish farmers who have embraced the challenge of Origin Green and sustainable production.

The challenge remains for Bord Bia and our processing sector to develop markets that consistently deliver a return for Irish farmers that makes them economically sustainable.