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New Analysis Confirms Drinks Industry is an Irish Success Story, Driven by Innovation

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New Analysis Confirms Drinks Industry is an Irish Success Story, Driven by Innovation

New Analysis Confirms Drinks Industry is an Irish Success Story,  Driven by Innovation
January 05
11:54 2018

Irish drinks businesses have released an end of year analysis for the sector, highlighting key areas of growth in 2017, as well as trends and future prospects. The analysis was compiled by Alcohol Beverage Federation of Ireland (ABFI), which says that the drinks industry is a great Irish success story, with innovation at its core.

The analysis found that in 2017 the industry continued to be a major contributor to economic activity across the country. The drinks and hospitality industry supports 204,000 jobs, with a wage bill of €4.3 billion. Many of these jobs are in rural communities, as the industry is present in every county across the country.  It supports 12,000 farm families, with €1 billion spent on grains and dairy every year.

The analysis found that the industry is an export powerhouse, delivering growth for Ireland’s food and drinks sector. The industry exports to 130 markets worldwide, with total exports worth €1.1 billion.

More choice brewing from the beer sector

  • Beer remains Ireland’s favourite alcoholic beverage with 46 per cent of the total alcohol market share
  • According to the analysis, Irish beer exports were valued at over €280 million in 2016, up 23 per cent in two years, with 40 per cent of beer produced in Ireland exported
  • Preliminary figures for 2017 indicate that the overall beer consumption trend is decreasing marginally by 1.8 per cent
  • Ireland is the 12th largest beer producer in the EU and the 8th biggest exporter of beer in the EU
  • There is an increasing amount of choice for beer consumers and this is set to grow in 2018
  • The craft beer revolution is continuing, there are now around 100 microbreweries operating in Ireland

Three cheers for whiskey, gin and cream liqueur as Irish spirits sector shows spirited growth

  • Preliminary figures indicate that the value of all spirits exports from the Irish Republic in the first three quarters of 2017 were up 13.3 per cent to €646 million
  • Growth in the spirits sector is being led by Irish whiskey, as Ireland’s whiskey renaissance goes from strength to strength. Irish whiskey remains the fastest growing spirits category in the world. The value of whiskey exports from the Irish Republic in the first three quarters of 2017 were up 14 per cent to €412 million. The value of Irish whiskey exports to the US and Canada increased 15.7 per cent and 21.5 per cent respectively in this period
  • Irish cream liqueur grew in popularity at home and abroad in 2017, after recovering from a ‘lost decade’ during which growth stagnated. Between 2012 and 2016, sales of Irish cream liqueur in Ireland (across both on and off trade) fell by 11.2 per cent, from 108,000 cases to 95,900 cases. This trend has now been halted. Over 90 million bottles of Irish cream liqueur were sold globally in 2016. Preliminary figures from Nielsen show that the value of Irish cream liqueur sales in the important Irish off-trade sector have increased by 3.4 per cent during 2017
  • A key trend in the Irish market has been the remarkable surge in the popularity of gin. Gin remains the fastest growing spirits category among Irish consumers while exports of Irish Gin more than trebled during 2017

Grape expectations for wine lovers 

  • The analysis found that the wine sector employs over 1,100 people directly, while supporting thousands of other jobs in Ireland’s 13,000 restaurants, pubs, independent off-licences and hotels that sell wine
  • Wine is becoming increasingly popular among Irish consumers. It is Ireland’s second most popular alcoholic beverage after beer, with market share for wine increasing from 27.7 per cent in 2015 to 27.8 per cent in 2016

2018: great prospects, grave concerns

While there was strong growth in 2017, drinks manufacturers warned that there are serious threats on the horizon. The areas of concern for the industry in 2018 are Brexit, Ireland’s disproportionately high excise rate and the unintended consequences of the Public Health (Alcohol) Bill.

Patricia Callan, Director of Alcohol Beverage Federation of Ireland.

Patricia Callan, Director of Alcohol Beverage Federation of Ireland (ABFI) said: “The Irish drinks industry is an integral part of the country’s overall food and drinks sector. However, there are a number of issues the industry faces as we head into 2018. Firstly, we have major concerns in relation to the Public Health (Alcohol) Bill. Drinks manufacturers support the objectives of the legislation – to tackle harmful and underage drinking in Ireland.  However, at present, the Bill contains a number of measures that won’t work and will harm an important indigenous industry.”

She continues: “Specifically, the labelling and advertising proposals in the Alcohol Bill are a major concern for drinks manufacturers as they plan for 2018. These proposals will negatively impact investment in Ireland by global players and will make it impossible for small brewers and distillers to establish their brands and export their products. In essence, the Alcohol Bill in its current form will deter innovation as companies, both large and small, will be constrained from bringing new products to the Irish market.

“On Brexit, there are risks associated with North-South regulatory divergence. Currently, both the UK and Irish Governments enforce the laws that ensure Irish Whiskey, Irish Cream liqueur and Irish Poitín can only be produced on the island of Ireland, subject to certain standards.  The EU and UK have committed to ensure this remains the case, which is extremely important. Thirdly, Ireland has the second highest rate of excise in the EU. This continues to put the industry in an uncompetitive position. We hope to work with the Government on these issues in 2018, to ensure growth is sustained.”

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