Covid-19 is on course to end Ireland’s decade of record food and drink export growth to €13bn, warned Bord Bia this week.
Tara McCarthy, CEO of the food board, revealed international trade figures were down by €126 million in the first five months of 2020.
She said, “The figures bring into sharp focus the profound need for the sustained and targeted supports the Department of Agriculture, Food and the Marine and Bord Bia have continued to provide to the agri-food sector, as the industry deals with the ongoing challenges posed by Covid-19 and Brexit.
“A relentless focus on market diversification is critical as we seek to trade our way through 2020 and beyond in more innovative ways than ever to deliver the additional €6bn in exports needed to meet the ambitious €19bn target of Foodwise 2025”.
In sectoral terms, the most significant year-to-date export decreases have been witnessed in alcohol (down 21% to €463m), followed by seafood (down 17% to €205m) and live exports (down 36% to €45m).
Strong value growth in dairy has enabled a year-on-year exports increase of €135m (7.1%). Five-months sales grew 5.5% to €36m in the EU; 9.7% to €31.5m in Asia; and 18.6% to €27m in North America. But dairy exports to the UK declined by €66m (17.7%), largely due to reduced cheese exports.
Despite the agility of the dairy sector in navigating the significant international turbulence, Bord Bia cautioned that due to the medium to long term nature of dairy contracts, the full impact of Covid-19 has yet to be felt, and the outlook for the rest of the year remains uncertain for dairy exporters.
The export news is not so good for beef. Primary beef exports to the EU27 for the first five months fell 16%, to €315m, and 11% to the UK, to €331m, countered to some extent by increased values and volumes to Asia (up 59% to €55m) and to the US.
Total Irish food and drink exports to Asia in the first five months of the year increased by 7% to €570m.
But the value-added meat category, with its greater dependence on the UK and on food-service, has slumped, down 20% for pigmeat and down 35% for beef.
Edible horticulture and cereal exports have dodged the Covid-19 slump, with exports increasing 9.1% to €97.4m. The star performers are mushrooms (exports up 29%), potatoes (15.1%), and fruit and nuts (2.5%).
Bord Bia CEO Tara McCarthy said: “In these challenging times for the food and drink export industry, it is more important than ever to maintain and grow our global connections in the export sector.
“Although there are significant restrictions on international travel and events, Bord Bia has continued to develop agile and proactive responses to these issues. We are excited about the role virtual trade missions can play in consolidating existing trade relationships, progressing market access aspirations worldwide, and how we continue to showcase Ireland’s world-leading food and drink industry credentials for global consumers in the most dynamic ways we can. In fact, it has never been more important.”
International travel restrictions and ongoing social distancing guidelines have necessitated Bord Bia revaluating its trade engagement strategy.
For example, the first-ever “Minister Led Virtual Trade Mission” for Ireland’s food and drink industry will take place in the autumn, targeting 150 trade buyers across Vietnam, South Korea, Philippines, Indonesia and Malaysia.
Additional virtual trade engagements are planned to target key customers across China, Japan, North America, Middle East, Asia and Europe throughout September, October and November.
Bord Bia’s new virtual approach to trade missions and online showcase events will replace last year’s more than 30 high profile trade shows around the world, now cancelled due to the global pandemic.
Ahead of Brexit, there will be particular emphasis on market diversification in territories such as Asia, where Irish food and drink exports in the first five months increased by 7%, to €570m.
While it is unlikely the 7% increase will continue, Bord Bia says Asia can continue to deliver growth, thanks to its growing populations, urbanisation, and demand for high quality and safe food.
Growth in Asia, particularly for pigmeat and dairy exports, is encouraging evidence of how exporters have embraced market diversification, said Bord Bia.