New Bord Bia Report Reveals Fears That COVID-19 Will Cause A New Recession
75% of food and drinks businesses that took part in a recently-conducted Bord Bia "Risk Readiness Radar" survey fear that COVID-19 will cause a new recession.
The survey, the report on the findings of which was published on Thursday July 2, was conducted over a four week period in March and April of this year, with a total of 128 Irish food, drink and horticulture companies, which account for 51% of total exports, taking part in it.
Impact Of COVID-19
91% of respondents said that the trade implications of COVID-19 are either a high or a very high priority for them, with fears that the virus will prompt a recession being a key concern by 75% of respondents.
When asked to rank the top concerns for businesses as a result of COVID-19, recession was ranked highest, with over 70% of respondents ranking it as a either significant or a very significant concern. Meanwhile, companies with a turnover below €1 million are more concerned about rising unemployment and how this will impact consumer spending.
Other COVID-19-related concerns such as staffing issues, significant decrease in foodservice demand, disruption to supply chains and maintaining production were ranked as being of high or very significance by over 50% of respondents.
Over 91% of respondents said that they have made progress in relation to their Brexit preparedness over the past 12 months, with 71% of respondents saying that they are actively seeking to expand into new markets in response to Brexit.
Despite the uncertainty surrounding Brexit, 41% of respondents reported an increase in their sales to the UK over the past year, while an additional 39% reported stable revenues.
55% of respondents said that they are planning to grow sales in the UK, and the remaining 45% said that they intend to maintain sales in the UK.
"An Informed Response"
Bord Bia strategic projects manager Shane Hamill stated, "The Irish food, drink and horticulture industry has had to withstand many shocks over the years. While a disruptive event is always an immense challenge for any business, dealing with the consequences inevitably helps businesses to build resilience and be better prepared for the next event. As a result of Brexit preparations, valuable skills in risk management have been learned by the agri-food sector, and there is evidence that the industry has been better able to manage the impact of COVID-19 because of the actions it had taken over the past three years.
"The 'Readiness Radar' builds on the previous work of the Brexit Barometer, which has been assessing industry preparedness for the UK's departure from the EU since 2017. As with the Barometer, this allows for an informed response from Bord Bia at strategic and granular levels to industry needs. The invaluable insight provided by the 'Readiness Radar' survey will influence Bord Bia's supports and programmes as we work with industry to navigate the period ahead."
"A Greater Sense Of Urgency For Overcoming Any Obstacles"
Meanwhile, Bord Bia chief executive Tara McCarthy commented, "Given our island location on the edge of Europe, Irish manufacturers with a growth focus are export dependent. The estimated value of food, drink and horticulture exports from Ireland for 2019 was €13 billion, capping a decade of extraordinary growth where the value of Irish food and drink exports increased by 67%. This has been achieved through sustained incremental increases in value and volume across Ireland's food and drink categories, and across its key export markets.
"The current scenario posed by COVID-19 and Brexit has created a greater sense of urgency for overcoming any obstacles presented by market diversification. Our whole organisation is reimagining how it can best respond and help position our clients for growth post-COVID. Our focus has shifted to providing reassurance to our global customers and consumers, with renewed urgency and vigour, that Irish food and drink is high quality and safety standard, distinctive and committed to sustainable production. Looking at the longer term future, we will provide our clients with world-class consumer insight, tailored supports and customer facing opportunities through our network of overseas offices. In these unprecedented and chaotic times, we are entirely focused on delivering the very best for our clients and, in my opinion, the role of Bord Bia has never been more important."
© 2020 Hospitality Ireland – your source for the latest industry news. Article by Dave Simpson. Click subscribe to sign up for the Hospitality Ireland print edition.