Ireland’s poultry meat exports suffered sharp fall in 2021

Ireland’s poultry producers see exports down and margins squeezed, as difficulties occurred with main export destinations.

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The export-dependent Irish poultry industry has been hit by difficulties in both its first- and second-most important overseas markets. Doram | iStock.com

The value of the Republic of Ireland’s poultry exports contracted by 15% to Euro 128 million (US$146 million) last year, primarily due to a fall in trade with the U.K., the country’s primary export market.

According to the country’s food promotion agency Bord Bia, poultry shipments to the U.K. shrank by 16% to stand at Euro 74 million, reflecting the sector’s high exposure to the U.K.’s foodservice market, which, like many others, suffered significant disruption last year.

Weaker demand from the U.K., however, was not the only reason for 2021’s fall in exports. Like other European exporters, Ireland was hit by a number of market access restrictions last year. South Africa’s suspension of Irish product at the end of 2020 was a particular blow, given that the country is the second-most import market for Ireland’s chicken meat exports.

Chicken meat exports from the European Union’s member states combined were 5% lower at 2.2 million metric tons.

Where intra-EU trade was concerned, Ireland’s sales for the rest of the EU stood at Euro 19 million, 16% lower. Not all export markets were negative, however, with shipments to France, for example, rising.

Output slightly higher

Despite falling sales overseas, Ireland’s output of poultry meat is thought to have risen slightly last year, with 112.7 million birds slaughtered - an increase of 1%.

The sector started the year in positive territory and, by the end of the first nine months, output was thought to be 3% higher than during the same period in 2020. However, the last quarter was negatively impacted by higher feed and energy costs, along with tighter labor availability.

Hit in both their home and export markets, Irish poultry producers have been suffering. The Irish Farmers Association (IFA) notes that, despite a surge in retailer demand for chicken meat in 2020, by the summer of last year, demand had weakened. In the closing months of the year, throughput of birds was scaled back.

Wholesale prices of birds failed to increase sufficiently to cover higher farm and processing costs, let alone those related to Brexit and COVID-19.

Producer margins have been severely squeezed, making urgent intervention necessary, the association has argued. Commenting at the end of last year, the IFA noted that, without an increase in payments, the sector could not be maintained at current levels.

Hour Glass

With margins becoming ever-tighter, poultry producers fear that the poultry industry may no longer be sustainable in its current form.  AndreyPopov | iStock.com


       

Poor performer

Ireland exports about 90% of its food and drink production, and the performance of the poultry industry is in contrast to the sector as a whole, which saw exports rise by 4% in value. In 2021, the value of Irish food and drink exports stood at Euro 13.5 billion, up 2% on its pre-pandemic level and reaching a record high.

However, 33% of Irish food and drink exports go to the U.K. Bord Bia notes that this is lower than the 37% recorded in 2016, yet it still means that the success of exports is still highly dependent on what is happening in the neighboring country.

This year could see Irish poultry meat exports decline further still.

Commenting on exports as a whole, Bord Bia Chief Executive Tara McCarthy said: “Notwithstanding last year’s record performance, there are a number of challenges ahead for the Irish food and drink sector. These include increased supply chain and input costs, which are affecting producers and processors, and the ongoing impact of Brexit, which has yet to be fully implemented.

“While the transition period ended on December 31, 2020, the U.K. has not yet started physical inspections of food and drink imports, and this is due to begin at the start of July."

For Irish poultry meat exporters, the degree of market access to the U.K. will be a determinant of prospects for recovery and growth. The U.K. introduction of new checks may well introduce further complexity and challenges for Ireland’s exporters.

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Stable outlook for Republic of Ireland’s poultry sector

www.WATTAgNet.com/articles/19783


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