Ireland's food industry targets export markets

By Lorraine Mullaney

- Last updated on GMT

Related tags Bord bia Food Ireland

Ireland now has more cattle on its shores than people
Ireland now has more cattle on its shores than people
Ireland has moved from famine to feast and is now a world-leading food and drink exporter with big plans to feed the world, says Lorraine Mullaney

Key points

There are 4.5M Irish people living in Ireland and 70M Irish people living outside it. But, surprisingly, people aren’t the country’s biggest export – food and drink is. Ireland produces enough to feed 10 times its population and its exports to 178 countries across the world achieved 9bn last year. But still it wants to produce more. Its dairy production alone will be raised by 50% when EU milk quotas are lifted in 2015. The focus for exports will be emerging, non-EU markets.

Sustainable production is fundamental to this plan, which is why the Irish food board, Bord Bia, launched the Origin Green initiative in 2012. The goal is for 75% of Irish food and drink exports to be certified as sustainably produced from Origin Green audited farms by the end of 2014. By 2016 all food and drink exports will be certified as on the road to sustainability.

Spreading the green message (Return to top)

To spread the word, Bord Bia invited food retailers and manufacturers from all over the world to Dublin this autumn for a conference titled ‘Sustainability: the bottom line’.

Welcoming those gathered at the event, the Taoiseach Enda Kenny, prime minister of Ireland, declared that Ireland was: "The best small country in the world to do business with.”

Origin Green is why Ireland should be judged to meet the very highest international standards,”​ he said. “It is not a marketing ploy but a visionary plan to reorient an entire agrifood sector.”

Raising the spectre of food security, he reminded his audience of Ireland’s painful history of cultivating an unstable crop: the potato.

He said: “A great hunger afflicted this country between 1845 and 1847. Our population was halved to 4M people, then 2M emigrated to lands across the sea.”​ The ships they left on are often referred to as ‘coffin ships’ because many of their passengers died from hunger on them.

Action must be taken to avoid another great hunger. The issues of global food security have been well documented and, with a population the size of Dublin City being born every week, we have to find a way of producing around 50% more food by 2030. This will require 50% more power and 30% more water and the industry already uses 70% of the world's fresh water.

Long-term future of industry (Return to top)

An enormous challenge. But one that must be tackled. And it’s not all bad news for food manufacturers because not only does more sustainable food production ensure a long-term future for our industry, it’s good for business. One of the reasons why is that it reduces waste.

Ireland’s largest seafood processor and shellfish exporter Errigal Seafood has grown sales by 55% over the last three years, despite the tough economic climate.

In recent years it has expanded its view of sustainability beyond job creation and social responsibility to include an environmental dimension. The firm worked with Bord Bia to set out five-year goals to reduce its use of energy, water, waste and its emissions.

One waste-reduction initiative focused on reducing the “mountains” ​of shells, which are a by-product of its manufacturing. Some of them were sent for incineration and some for rendering.

Speaking at the Bord Bia event, Errigal’s director of innovation, Margaret Daly said: “There’s a great win-win for any firm that focuses on reducing waste going forward. Initially it was a nightmare, but it pushes you to be more innovative. I was dreaming about how to get rid of all the shells.”

Not only has the firm “significantly”​ reduced the amount of shells that are sent for rendering, it’s using the process to develop new product lines. For example, it’s now exploring using its by-products as organic fertiliser and road grit.

Daly said: “Our participation in Origin Green enables our customers to meet the growing information demand from their end-consumers about the ultimate impact their daily diet is having on the world.”

By increasing its focus on sustainability, Errigal also reports significantly reduced operating costs, lowered carbon emissions, strengthened community bonds and inspired innovation.

Get more from less (Return to top)

Technology can help manufacturers work smarter and get more from less, which is not only good for sustainability, it’s good for profit. Dairy firm Glanbia – a key stakeholder in Origin Green – uses fractionation technology to extract the vitamins and minerals from milk and segment them to add value.

Jim Bergin, chief executive of Glanbia Ingredients Ireland, said: “We have to achieve as much as possible per hectare and bring the lower performers up to the level of the higher performer. We’re at the top of our game in Ireland and our national quality scheme for milk is setting the standard.”

It’s a standard they will have to maintain to help the country meet its target of expanding dairy production by 50% by 2020.

Bergin also highlighted that sustainability was about risk management and securing supplies of raw materials in a volatile world.

He said: “It’s a hassle and the gain is pre-competitive. Cost is the wrong term. It’s not about cost, it’s about investment. The return is increased sales. If these primary production pools are not available then sales can't grow. So the payback is a long-term investment in an intangible asset.” ​He added: "We have to realise that nurturing the primary producer is a critical asset.”

Mars presented examples of how it had invested in its primary producers to secure future supplies of cocoa.

Rising demand (Return to top)

With demand for chocolate rising and incomes and yields from cocoa plantations stagnating and, in some cases, declining, Mars was faced with a real problem. Many of its farms on the Cote d’Ivoire needed rehabilitation and suffered from ageing trees, depleting soil and unreliable rainfall. This was driving farmers to switch to more viable crops or move out of farming altogether and into urban industries. With demand for chocolate predicted to outstrip supply by 1Mt a year by 2020, the industry is under real pressure.

Scientific research helped Mars to develop the best cultivation techniques by mapping the cocoa genome. This was open-sourced to enable scientists to identify higher-yielding, more pest-resistant varieties. Mars disseminated this information to its 150,000 cocoa farmers on the Cote d’Ivoire, enabling them to apply the best techniques to increase their yields. It plans to have all of its cocoa 100% sustainably certified by 2020.

Describing sustainability as key to our “financial success”​, Daniel Vennard, global sustainability director for brands at Mars emphasised that such practices “ensured the success of all stakeholders all along the supply chain”.

Nestlé has also been nurturing its primary producers: Ethiopian coffee farmers. It has introduced water-saving technology for its post-harvest processing in Ethiopia that has saved 26Ml of water per crop. And back in the UK at its processing facilities in Hayes and Tutbury, it has cut 20% of the energy requirements by processing spent coffee beans as fuel. This reduces the use of fossil fuels and cuts the amount of waste to landfill.

Reducing the pack sizes of its refills has enabled it to fit twice as many on a pallet, which means using 50% fewer lorries to transport them to the customer.

But not all food manufacturers have the financial clout of the likes of Mars and Nestlé. How can we encourage smaller producers and manufacturers to get on the sustainability train?

The economic advantage (Return to top)

John Horgan md of the Kepak food processing group, said one driver would be the economic advantage of improving security of margin at farm level. On improving the profitability of the sector he said: “There’s too much talk about price and not enough about margin in this sector. It's about reducing the cost of production and increasing the return. Beef prices have increased over the last five years by about 30% but farmers who have worked on their productivity within the farm gates have been able to add an additional 30% by improving their output.”

Sustainability is good for your brand, which also has economic advantages. Daly said: “Reputation is very important where food is concerned. People have an emotional engagement with it. Since the world financial crisis, new behaviours are the norm. The whole area of being transparent and building trust is crucial to every country. It can’t be built with a PR campaign, it has to be something tangible.”

So consumers want it all. The best price, the perfect supply chain and absolute and total transparency. But do they really care about sustainability and are they willing to pay for it?

Inder Poonaji, head of sustainability for Nestlé UK and Ireland, said: “Consumers do care. I repeat: they do care. And the questions are getting louder. The landscape is shifting and our role is to provide them with the assurance they need while creating value for our shareholder.”

The Irish industry’s doing it. Are you?

To hear Bord Bia chief executive Aidan Cotter describing how the horsemeat scandal has helped to boost exports of Irish beef by 16% listen to our exclusive podcast​.

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