1.1 Overview

1.1 Overview

Trading in food, animal skins and furs has been taking place for centuries. Most countries start trading with these basic commodities and over time as their basic needs are fulfilled, they began to trade in other goods. The agri-food sector in Ireland is the oldest and largest indigenous exporting sector and its products are traded from every county in Ireland to 180 countries around the globe. The agri-food sector includes primary production in farming, fishing and forestry, and the processing and manufacture of food, beverages and wood products. In 2022 the sector exported goods valued at a record €18.98 billion, accounting for 9% of all the merchandised goods exported from Ireland. The Irish agri-food sector is globally orientated, with approximately 90% of Irish beef, sheepmeat and dairy produce exported each year. In 2022 we exported more than one billion euros in value of each of the following: fresh or chilled Irish beef, natural butter, cheese and Irish whiskey.

These record exports are dependent on the almost 165,000 people employed in the sector across 135,000 farms, 2,000 fishing vessels & aquaculture sites and some 2,000 food production and beverage enterprises. The sector is responsible for 4.5 million hectares of agricultural land and 808,848 hectares of forestry or some 76% of the total land in the State.

In Ireland, agri-food is an integral part of the economy and society, and especially so for our rural and coastal communities. Beyond direct employment, the sector plays a key role in the wider rural and local economy, with estimates for output multipliers ranging from around 2.5 for beef, 2.0 for dairy and food processing and 1.75 for seafood. This compares with an average output multiplier of 1.4 for the rest of the economy and 1.2 for foreign owned firms. The agri-food sector contributes strongly to the Irish economy, for example, food sector clients of Enterprise Ireland spent €15.6 billion in the Irish economy in 2021 accounting for 50% of total spend by all of their clients.

The sector produces food and ingredients with a global reputation for quality and safety, with a livestock sector built on an enviable grass-based production system. Global demand for highquality food is increasing with population, urbanisation and affluence. The Irish agri-food sector is well placed to play a role in meeting this demand. Food Vision 2030, the strategy developed by representatives of the entire sector, sets out a vision for Ireland to be a world leader in sustainable food systems over the coming years.

The agri-food sector has faced many significant challenges over the past few years caused by Brexit, COVID-19 and the illegal invasion of Ukraine by Russia. These events have resulted in the food services sector closing for many months during 2020 and 2021, pushed gas and oil prices to record highs, and has severely disrupted the world trade in wheat, fertilisers and sunflowers. Yet the sector has remained resilient and continued to ensure a safe supply of food to the shelves in our supermarkets. Irish farmers faced increases in costs of over 30% in feeding stuffs, 45% increase in energy costs and almost 100% increase in fertiliser costs during 2022, with these three items accounting for 55% of their total costs. Cattle, sheep and pig farms saw their Family Farm Income fall in 2022 while tillage and dairy farms saw their incomes rise. The second quarter of 2023 has seen inflation falling somewhat but the costs to farmers are still significantly higher than they were in early 2021. Brexit, which has impacted the agrifood trade more than most other sectors into and out of the United Kingdom since late 2016, is becoming more settled although this will again be tested in early 2024 when new United Kingdom import requirements for agri-food imports will apply.

The past four or five years have raised a number of challenges for the agri-food sector and it has risen to the challenge, showing its resilience as it continues to provide safe, nutritious, wholesome food and drink not just in Ireland but to people all around the world.

Figure from page 12