Food and drink exports surge 12% to record high of €8.65 billion in 2011

THE GOOD news story for the food sector continued yesterday as Bord Bia announced a record year for Ireland’s food and drink sector.

Irish food and drink exports increased by 12 per cent, or €1 billion, in 2011 to reach an all-time high of €8.85 billion, according to the State agency.

The agrifood industry – which is heavily dependent on exports – accounted for 25 per cent of Ireland’s rise in export revenue, with food and drink exports increasing at three times the rate of Ireland’s merchandise exports in the first nine months of the year.

The record rise in exports was driven by high commodity prices on world markets. Agricultural commodity prices reached record levels in 2011, with the UN Food and Agriculture Organisation food price index recording growth of 26 per cent during the first 11 months of the year.

However, while the increase was driven primarily by value, growth in the volume of product sold was also a factor, with an increase in the volume of sales accounting for 25 per cent of the rise in food and drink exports.

Speaking at the launch of the report, Minister for Agriculture Simon Coveney praised the “extraordinary growth story that has happened to the food industry over the last two years”.

He noted that the agri-sector was different to other exporting sectors in the economy due to its impact on the domestic economy, with all of the product grown and developed in Ireland.

A breakdown of the Bord Bia figures shows dairy and meat sectors were the strongest performing categories last year, each accounting for about €2.6 billion, or 30 per cent, of food and drink exports. Prepared foods accounted for €1.5 billion, or 17 per cent, of sales, with seafood representing €440 million or 4.5 per cent.

The UK remained the primary destination for food and drink exports, accounting for 41 per cent, or €3.66 billion, of total Irish food and drink exports, an increase of 6 per cent. The EU was the second-largest market, buying 34 per cent of Ireland’s food and drink exports – a rise of 16 per cent on 2010.

The value of exports outside of Europe grew by 20 per cent, or €350 million, to reach almost €2.2 billion last year. Exports to Asia jumped by a third.

Bord Bia said that while prospects for food and drink exports in 2012 remained positive, lower volume output availability in some sectors and softening in global prices were likely to curtail growth potential in the short term.

Separately, Kerrygold announced yesterday that it achieved record sales growth in the US last year. Preliminary data indicates 2011 will be a record year for the brand in the US, with year-on-year sales up 17 per cent on a constant currency basis. The brand has reported annual double-digit growth over the past 10 years.