‘Irish dairy can grow’: Bord Bia optimistic despite dip in exports during ‘very tough’ 2023

Irish dairy exports saw a modest decline on 2022’s record-breaking performance when dairy exports rose to €6.8bn (+33%) in value terms on the back of high farmgate milk prices and strong milk production.

But with global trade experiencing a decline throughout 2023, Irish dairy exports also slipped – by around 8% to €6.3bn in value terms, as revealed in the Irish Food Board’s (Board Bia) annual export performance report. A combined increase of 6% in the value of cheese, specialized nutritional powders and yogurt helped to partially offset the overall declined, said Bord Bia but noted that 2023’s result was still 22% ahead of 2021’s export performance.

David Kennedy, Bord Bia head of dairy, explained this year’s dip in dairy exports with the oversupply situation that materialized in 2023 and the bearish global commodity markets. “If you think back to the second half of 2022, we saw high farmgate prices across the world on milk, which led to increased supply,” he said. “That increased supply meant that we started this year globally with high stocks and expensive stocks of dairy commodity products. These products struggled to work their way through the supply chain, as the cost of living crisis meant that affordability was a real challenge for the global consumers. We saw this in Europe where butter and cheese sales in retail were challenged, and indeed North America and Southeast Asia and West Africa.”

Butter (€1.3bn), cheese (€1.2bn) and whey ($250m) made up 45% of the total dairy export volume, with Kennedy stating all three commodities suffered price declines in 2023. “2022 was an unbelievable year for butter, with EU prices of around €7,000 per ton available throughout the second half of the year. Coming into 2023, those prices are back to €4,000-€5,000 per ton, so a significant fall-back there. Equivalent prices on cheese, 25% back on 2022 prices and then SMP, 40% back on 2022 prices.