Ireland’s beer industry makes a significant contribution to the economy, directly employing 1,064 people and contributing €424 million to the exchequer through excise taxes in 2017, according to the Irish Brewers Association (IBA), which has just released its annual “Irish Beer Market Report 2017”.
The report found that beer exports, by volume, rose marginally by 0.2% and were valued at €273 million in 2017, making Ireland the 8th largest beer exporter in Europe. The value of exports is down marginally from €280 million in 2016, but still up sufficiently from €228 million in 2014. The most popular destination for Ireland’s beer exports is the United Kingdom, followed by the United States. France, Canada and Germany are also popular destinations for Irish beer.
The report also found that the craft beer revolution continues to take hold in Ireland, with around 100 microbreweries now operating around the country. The craft beer sector continues to grow, with production going from 86,000 hectolitres in 2014 to an estimated 238,000 hectolitres in 2017. That represents a 177% production growth in just four years.
Fall In Consumption
Meanwhile, consumption of beer in Ireland fell between 2016 and 2017. This is in line with the overall trend to lower alcohol consumption in Ireland. Alcohol consumption in Ireland has fallen by 25% since 2005, according to the World Health Organisation (WHO). Additionally, the latest ESPAD report showed a significant decline in underage alcohol consumption, with Ireland moving from 8th to 28th out of 33 countries analysed over the course of the study.
Despite a fall in consumption, beer remains Ireland’s favourite alcohol beverage, accounting for just under 45% market share of all alcohol consumed in 2017. Lager is the most popular beer variant, followed by stout and then ale. The most significant shift in the beer variant market share was a 0.6% increase in consumption of ale in 2017.
Also, on consumption habits, the report found that Ireland’s on-trade beer sales continue to outperform off-trade sales by 64.8% to 35.2%. The report notes that no other country in the European Union has a higher percentage of on-trade versus off-trade beer sales, which highlights the continued strength of Ireland’s hospitality sector.
IBA Reaction
In 2017, the excise rate on beer in Ireland was the second highest European Union and the IBA is calling on the government to reduce excise to benefit both the industry and consumers.
Head of the IBA Jonathan McDade commented, “Beer is a significant economic and cultural asset in Ireland. Beer drinkers in Ireland must endure the second highest rate of excise tax in the EU and so I call on the government to reduce the rate of excise on beer in Budget 2019.”
Alcohol Bill
Irish beer producers also warned that the labelling measures in the Public Health (Alcohol) Bill, specifically the requirement to add cancer warning labels to alcohol products, could impact future growth and called on the government to make reasonable amendments to the legislation.
McDade asserted, “There are a number of challenges ahead for the beer industry, including Brexit and the Public Health (Alcohol) Bill. In relation to the Public Health (Alcohol) Bill, we are calling on the government to remove the requirement for cancer warnings on alcohol products, as it is a disproportionate measure that represents a barrier to trade in the EU amidst Brexit uncertainty. Irish beer producers will be required to develop labels specifically for the Irish market and a second set of labels for elsewhere, which will impact on their ability to export.
“It could also impact the growth of Ireland’s craft beer sector. It is anticipated that it will cost approximately €50,000 to redesign an entire suite of labelling for a single product line and additional stock control costs will also arise. Smaller producers will be impacted significantly as they will be less able to absorb costs.
“It will cause huge reputational damage to Ireland’s beer industry. No other country in the world has mandatory cancer labels on alcohol products, and such a measure applies a stigma to products made in Ireland.
“We believe that the objectives of the Alcohol Bill could be achieved through more effective and less trade restrictive means, which would tackle the issue of alcohol misuse and would not unnecessarily damage this industry.”
© 2018 Hospitality Ireland – your source for the latest industry news. Article by Dave Simpson. Click subscribe to sign up for the Hospitality Ireland print edition.
