USA is a land of opportunity for Irish agri-food exports

With a whopping €1.7bn in exports making it across the pond in 2022, a significant chunk of Ireland's €19bn total agri-food exports, the importance of our special relationship with our American cousins can't be overstated.

It's also an essential part of the broader Irish economy, with agri-food representing Ireland's largest indigenous exporting sector. The Food, Drink and Primary Production sector accounted for 40% of all export sales by Irish-owned companies in 2021, directly supporting the jobs of 164,900 people in Ireland (6.5% of the country's total employment).

The American food market appears to continue to go from strength to strength despite the fact that strong connections between US and Irish companies go back several decades.

Until 2018, the United States was the third largest importer of Irish agri-food, but the US moved to second in 2019, overtaking the Netherlands.

Both the volume and value of food exports to both countries have continued to increase over the last five years. However, the pace at which growth has occurred has been faster in the US, increasing a staggering 33% over the span of just a year.

Analysts attributed the surge to a significant increase in dairy and beverage exports in 2022, with the top two agri-food categories representing the lion's share of Ireland's agri-food exports to the US.

The last year of full trade figures show Irish dairy produce exports to the US totalled an additional €230m (up 52%), while exports in the beverages grew by €172m —  a 26% increase — primarily driven by the American taste for all things Irish, including Jameson whiskey, Baileys cream liqueur and Kerrygold butter.

Speaking to the Irish Examiner, Dairy Industry Ireland director Conor Mulvihill explained brand power had been a major factor behind the growth.

"Irish dairy exports to the US achieved phenomenal growth in 2022 due to the exceptional performance of the Kerrygold brand, which has established itself firmly in American households as one of the US's favourite premium butter brands. It currently holds the enviable position as the number two butter brand in the whole of the States," he said.

"Allied to this, Ireland's specialised nutrition success story also performed very well in 2022, with infant formula sales to the US performing exceptionally strongly during a time of shortages in that market.

"We very much are working to endeavour to retain these markets and are working with Irish, US and EU officials to ensure no reactivation of the trade war that occurred during the last Trump administration.

"During that time, Irish dairy was subject to substantial tariffs during a trade war that undermined our competitiveness." 

Golden opportunity

Much of these sales can be attributed to Ornua, an Irish dairy co-operative that markets and sells dairy products on behalf of its members, Ireland's dairy processors and, in turn, their suppliers — 14,000 Irish dairy farmers.

The co-operative is Ireland's largest exporter of Irish dairy products and has annual sales of over €3.4bn, including the much-loved Kerrygold brand.

The Kerrygold brand has almost become a golden success story of the Irish-American agri-food trade, with more than 23,000t shipped to the states annually and a cult following which includes the likes of Oprah, Sarah Jessica Parker, and even Khloe Kardashian.

In 2019, the brand reached annual global retail sales of €1bn – an historic milestone for an Irish dairy brand, but Kerrygold could soon be set to reach double that, Róisín Hennerty, global managing director at Ornua Foods, explained. 

"Kerrygold's impact in the United States may be perceived as an overnight success, but it is a 30-year story in the making. The brand first launched in the US in 1990 through the arrival of Kerrygold cheese, followed by the first pallet of Kerrygold butter to US shores nine years later," she said.

"Since then, we have scaled our business to drive further penetration among US households, ensuring we connect with consumers in a meaningful way and deliver the high-quality dairy products they love, when and where they need them.

"Kerrygold butter is now the No.2 butter brand and the No.1 imported butter, in the world's largest consumer market, and the brand continues to grow at a phenomenal rate."

Ms Hennerty explained that the famous butter brand's success is largely down to the pertinence of its story in the US.

"For over six decades, the Kerrygold brand proposition has been built around premium quality and superior taste, owing to the 'grass-fed' difference," she said.

"Made from the milk of Irish grass-fed cows, Kerrygold tastes and looks different when compared to other dairy products available globally, and these qualities have resonated with US food-lovers in particular, who are passionate about and value this difference in the taste and texture.

"In addition to the unique qualities of the product itself, we are focused on bringing the Kerrygold brand promise to life in an authentic and compelling way through in-market activation programmes that truly connect with a loyal and growing consumer base, ensuring Kerrygold shows up at the very heart of cultural food moments across the US and elsewhere."

The firm has also continued to invest in future growth.

"Five years ago, Kerrygold became Ireland's first billion-euro food brand, and we are well on our way towards becoming a €2bn brand," Ms Hennerty said.

Supporting that continued growth journey is our investment in the brand, in product innovation and in the expansion of our range. We recently completed a major development project at Kerrygold Park — the global home of Kerrygold – based here in Ireland, in Mitchelstown, Co Cork, which has seen the production capacity of the facility double to meet the growing global demand for Kerrygold products, including in the US.

"Around the same time, we launched a major new global advertising campaign in the US, and first, at home in Ireland, which will reach over 150 million consumers in its first 12 months." 

Beverage exports

The other major driver of transatlantic agri-food trade was of course, the beverage sector. Irish beverages were exported to over 100 countries globally last year, making up 11% of Ireland's total agri-food exports.

The sector's exports reached a record high in 2022, exceeding €2bn for the first time — almost double the value exported a decade ago.

This saw growth from €1.1bn in 2013 to €2.1 bn (up 88%) last year. But most strikingly, it comes following a challenging year with the closure of the hospitality sector during the Covid pandemic lockdowns.

The impact on hospitality heavily curtailed demand for alcoholic beverages, but exports have since bounced back with vigour, with a €344m increase on the previous peak in 2019.

The top ten destinations by value for Irish beverage exports were the United States, the United Kingdom, Canada, France, Germany, South Africa, Latvia, the Netherlands, Poland and Italy, which combined accounted for 80% of Irish beverage exports in 2022. 

It's no surprise that the largest products within this category are Irish whiskey and Irish cream liqueur, with exports valued at €1bn and €405m, respectively.

The United States was the single largest destination for Irish beverage exports, spending more than double the amount sold to the second largest destination, the UK.

In 2022, more than €829m of Irish whiskey, liqueurs and other beverages were shipped across the Atlantic in 2022 — an increase of 26% compared to the year before.

Something to raise a glass to!