Although Brexit is just over six months away, and prospects of future trading arrangements are still uncertain, the British share of Irish beef exports grew by 2% in the first half of this year compared with the same period in 2017. In the first six months of this year, 107,142t or 1,626t of Irish beef was sold in Britain compared with 105,516t in the same period last year, an increase of 1,626t.
This importance of the British market for Irish beef exports is illustrated by the gap between it and our second-largest export market – France. The French market took 20,195t in the first half of this year, which actually was less than the first half of 2017 when 21,507t of Irish beef was sold in France.
Other markets in the EU also showed decline in the first half of this year compared with 2017. Sweden, which has been growing market in recent years, fell from 8,471t in the first half of 2017 to 7,027t in the first half of this year, a 17% decline. Spain too fell sharply from 5,051t in the first half of 2017 to 4,115t this year, as did Denmark, which was down from 5,301t in the first half of 2017 to 4,595t in the first half of this year. Belgium too slipped this year compared with 2017 from 2,757t to 2,550t.
The biggest growth market for the first half of this year was the Netherlands (NL), which grew from 15,780t in the first six months of 2017 to 17,655t in the first half of this year, an increase of 12% and that made the Netherlands our second most important export market for beef after Britain. Italy too performed strongly, with 12,101t exported this year compared with 10,884t in the first half of 2017. In percentage terms, Switzerland was the strongest performer, with a 40% increase, though this was of a low base of 1,068t in the first half of 2017 growing to 1,497t this year.
Offal and byproducts are an important part of the overall value of the beef animal to the industry. It is a product that is less popular in our traditional markets, with the majority of sales to Asian and African markets. Hong Kong (HK) has been Ireland’s largest offal market in the first half of 2017, taking 10,346t, but this slipped this year to 8,590t, putting HK into second place behind Britain, which took 8,895t of Irish offal.
The Philippines market for Irish offal has grown this year from 4,561t in the first half of 2017 to 5,697t in the first half of this year and remains our fourth most important offal market. Sweden comes next on 3,730t for the first half of this year down from 3,956t for the same period last year. France, however, has grown this year to 3,417t, which is up 11% on the first half of last year.
While Africa is a major market for dairy, we don’t normally associate it with being important for the beef sector. However, the west African country of Ghana took 3,113t of Irish offal in the first half of this year, which is down from 3.497t in the first half of last year. Offal sales to the NL increased this year by 17% to 2,073t and Poland was also up, taking 1,171t in the first half of this year.
In future market reports we expect that China will feature prominently but although the decision was announced in May, no product was exported to China before the end of June. The US, which has been a slow-growing market since it was opened three years ago, showed a big growth in offal imports for the first half of this year. However, the growth of 120% was on a very low base of 310t which increased to 681t in the first half of this year.
Ireland, like most other EU countries, is producing more pigmeat this year, with supplies up by 5% to 141,000t compared with 133,800t in the first half of 2017. As with beef, Britain remains the biggest market, taking 54,800t between January and June this year, which is down from 55,900t in the same period last year.
Sales to China, the second most important export market for pigmeat, fell to 28,700t in the first half of 2018 compared with 32,800t in the first half of last year. Strong competition from other EU exporters is the cause of this decline though China remains our second most important export market by a considerable distance. Denmark is in third place on 9,300t for the first six months of this year which is a big increase from 6,700t in 2017.
There has been very substantial growth in Asian markets outside of China. Japan has increased by 2,000t year on year from 4,200t in the first half of 2017 to 6,200t for the first half of this year. Exports to South Korea have almost doubled from 1,600t in the first half of 2017 to 3,100t this year. There was strong growth also in Australia and the Philippines with exports of 4,700t to the Philippines, up from 3,400t last year. Australia took 3,400t this year, up from 2,900t last year.
The volume of Irish sheepmeat exports was down 9% to 24,204t in the first half of 2018 compared with the previous year, though stronger prices meant that the value of exports were actually 4% higher when compared with last year at €149m.
Both of our largest export markets fell in the first half of 2018 compared with the previous year. France was down 8% at 7,778t for the first half of 2018 while the UK market fell by 15% to 5,446t in the six months to June compared with the same period in 2017.
There has been considerable growth this year in Ireland’s smaller export markets. Germany is now a very substantial export market for Irish lamb, taking 2,690t in the six months to June, which is a 24% increase on the same period in 2017. Belgium has also been an important growing market for several years and the first half of this year showed an 11% growth on the previous year of 11% to 1,994t. Irish exports to Belgium have increased threefold since 2010 when 1,274t was exported for the entire year and the Delhaize supermarket group, which has 800 stores, now stocks exclusively Irish and British lamb under the Celtic Lamb logo.
Challenging year for global grain production
Reduced wheat and barley yields
Due in part to challenging growing seasons in key grain production regions including Europe and Australia, total world grain production is expected to show a second consecutive annual decline in 2018/19, to 2,063mt (million tonnes).
For the first time in six years, the global wheat harvest is predicted to fall 42mt, while barley output could be the lowest since 2012/13. This has contributed to strengthened grain prices over the past number of months.
However, after a drop in the previous year, the maize crop is expected to rebound, although this is mainly forecast on planting potential improvements in South America, where planting for 2018/19 is only just beginning. The global maize harvest is now pegged at 1,087mt.
Record soya bean harvest
Global soya bean output in 2018/19 is expected to expand by 8% to a record of 366mt, driven mainly by good harvests in major producing countries. For example, expectations for the 2018 US soya bean harvest were recently raised from 124.5mt to 130.1mt.
Despite a challenging global trading environment, increased imports to Europe and a number of other countries has offset the fall in China’s purchases, resulting in an increase of 3% in soya bean trade in 2017/18.