Northern Ireland exports to Britian remain crucial for food and drink processors, new study claims
Britain remains the biggest market for Northern Ireland's food and drinks processing sector, according to a report.
The Department of Agriculture, Environment and Rural Affairs (DAERA) confirmed that the value of produce heading across the Irish Sea increased to £2.2bn in 2016, accounting for 50% of the £4.478bn total sales that year.
The 'Size and Performance of the Northern Ireland Food and Drinks Processing Sector, Subsector Statistics' study also reported that the Republic of Ireland is the most important export destination for the sector.
Cross-border trade south accounted for £646m in 2016, which amounted to 15% of total sales.
Signalling the crucial nature of exports for the sector, the report confirmed that in both 2015 and 2016 the size of value of the Northern Ireland domestic market was smaller than those markets outside of the UK.
DAERA's report revealed a resurgent food and drink processing sector in 2017.
After the total value of sales in Northern Ireland dipped from £4.415bn in 2015 to £4.365bn in 2016, provisional figures for last year show that the sector had added £113m in turnover, bringing it to just under £4.5bn.
The total number of people directly employed in food and drink processing increased 4% from 20,555 to 22,413 full-time workers. The figure is estimated to increase 4.8% for 2017 to 23,479 full-time employees.
Within the sector, beef, lamb, milk and milk products represented the largest subsectors for gross turnover in both 2015 and 2016. Together they account for 48% and 49% of the sector's total gross turnover in these years respectively.
Charlie Kerlin, head of agri-food at business advisory firm Grant Thornton, said the new data provided "welcome reading" for the food and drinks processing sector. However, he said performance "varied widely" across the subsectors, with firms processing sheep and beef meat estimated to have increased turnover by £40.9m compared to a provisional £8m decline in turnover in the pigmeat sector.
"The statistics also show an overall growth in employment in the sector, up 4.7% to 23,479 full-time equivalents. This is a reminder of the importance of the sector for local employment," he said.
"The report also includes a useful snapshot of the relative size of Northern Ireland's export markets, ahead of the UK's exit from the European Union.
"Finalised figures for 2016 show that around 75% of sales are in the domestic market, with Great Britain continuing to be our primary market. However, exports to the Republic of Ireland amounted to £646m or just under 15% of overall turnover," said the agri-food advisor.
"It illustrates how much of the sector is likely to be most impacted should a 'no deal' Brexit occur and the possible imposition of World Trade Organisation tariffs, dramatically increasing the costs of selling to markets outside the UK."