Rapid growth of Irish food processing may slow down

THE Irish food processing sector has recorded greater growth than its equivalent in any other EU country over the past five years…

THE Irish food processing sector has recorded greater growth than its equivalent in any other EU country over the past five years, a conference in Dublin was told yesterday.

However, Mr Eamon Pitts, in addressing the Teagasc Agri-Foods Economics Conference in Dublin, said that Ireland's capacity to continue the rapid growth of the past few years was limited by product mix factors.

Several of Ireland's strongest industries, such as butter and beef, are in markets with slow or no growth, Mr Pitts told the conference.

Calculated on 1990 as a base year, the output of the Irish food and drinks sector increased by 37 per cent between 1990 and 1995.

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The only other EU member-states to significantly exceed the 6.5 per cent EU average over the same period were Greece (18 per cent), Denmark (11 per cent) and Germany (10 per cent).

Growth in Ireland was distributed across all sectors but was particularly marked in the "other foods", "meats" and "milling and confectionary" sectors, Mr Pitts said.

His study also found that Ireland was internationally competitive in 16 out of 31 "large" markets. This was a similar proportion to Denmark and Greece but a much larger proportion than Britain, which was internationally competitive in only four out of the 31 "large" markets.

However, an examination of the competitiveness of the Irish food industry in growing as opposed to static or declining markets showed that the Irish food industry was weaker than Denmark's.

This was because of the presence of several of our stronger industries in sectors with slow or no growth. In the "smaller" market sectors, Ireland had a strong competitive position on chocolate products and soups.

Mr Pitts concluded that Ireland's geographical position on the edge of Europe was not a major barrier to rapid success in the European food industry. However, "Ireland's capacity to continue the rapid growth of the last few years may be limited by our product mix".

Mr John Heavey told the conference that preliminary estimates indicated that farm incomes for 1996 would be maintained at 1995 levels. This followed four years of income increases.