1. food and drink

Issue 2 2015
Gearing up for Marketplace International
€35m injection for dairy industry
FOCUS:
INTERNATIONAL
MARKETS
US market sees launch of Irish beef
Irish Country Meats puts in strong performance in Belgium
China remains a key focus for Irish dairy industry
www.irishfoodmagazine.com
Award Winning
Quality Beef
ABP Food Group is the leading exporter of
beef products and a leading supplier to the
retail, catering and manufacturing markets in
Ireland, the UK, Europe and around the World.
www.abpfoodgroup.com
IRISH
WINNER
Address: 14 Castle St, Ardee, Co. Louth, Ireland Telephone: +353 (0) 41 6850 200 Email: [email protected]
editorial
Issue 2 2015
Here are some numbers for you:
84.5 4.5m
the
size in
km2 of
Ireland
180
Ireland’s
population
the number of
countries Ireland
exports to
€10.5bn
the value of
Irish food
and drink
exports
For a country of its size, Ireland’s export reach is wide, and its value is impressive.
And we’re not done yet. In the industry-led strategy, Food Harvest 2020, a target of
€12 billion in food and drink exports has been set out. With Ireland now in its fifth
year of consecutive growth, that target looks well within reach. Already the industry
is looking beyond 2020 and assessing targets for 2025.
Bord Bia (the Irish Food Board) is the State agency charged with promoting sales
of Irish food and horticulture both abroad and in Ireland. On March 26, Bord Bia
will welcome some 500 international and domestic buyers to its biggest domestic
buyers event – Marketplace International. Described as ‘speed dating for business’,
Marketplace International will bring over 170 Origin Green verified member
companies together, under one roof, to meet international buyers.
Since its inception, the event has evolved and this year’s Marketplace International
has grown to include, not only a one-day speed-dating showcase, but alsoseveral
industry-specific visits to Irish producers. This is a fantastic opportunity for the 100
or so international visitors to see, first-hand, Ireland’s natural advantages as a food
producing nation.
Irish people are fiercely proud of their farming traditions. And, more than that, they
are extremely proud of the evolution of the country’s agri-food industry, from its
roots in primary production to a scientifically-advanced and innovative sector of the
economy.
In this edition of
, we explore some of the international successes for Irish
food and drink exports. We also have news on some of the highlights of this year’s
Marketplace International and, as always, we have the latest news and trends.
Enjoy!
Oonagh O’Mahony
Editor
Follow
on Twitter @IrishFoodMag for more
updates on Ireland’s agri-food and drinks industry.
www.irishfoodmagazine.com
Issue 2 2015
3
contents
6 News
• Baileys partners with Enterprise
Ireland for brand sustainability
• Glanbia opens €185m Belview
facility
• Irish food industry launches
search for 30 ambitious
professionals to fly the
flag overseas
• Dan Kelly’s Cider to quench
German thirst
10 Ireland’s
international
appeal
Ireland
welcomes 350
visitors to
Marketplace
International on
March 26
Editor: Oonagh O’Mahony
Reporters: Bernie Commins, Kennas Fitzsimons,
Shauna Rahman
Design: Barry Sheehan
Production: Martin Whelan
Ciarán Brougham, Niall O’Brien, Michael Ryan
Chief Executive: Rebecca Markey
Advertising Executive: John Sheehan
Accounts: Tricia Murtagh
Administration: Sue Nolan
Publisher: David Markey
Copyright IFP Media 2015.
No part of this publication may be reproduced in any material form
without the express written permission of the publishers.
12
Making the right noise at Marketplace
In advance of Marketplace International,
speaks with some of the Origin Green-verified
members exhibiting to find out what visitors can
expect at at this year’s show on March 26
Published by:
IFP Media,
31 Deansgrange Road, Blackrock, Co. Dublin
Republic of Ireland.
T: +353 1 289 3305
F: +353 1 289 6406
E: [email protected]
www.ifpmedia.com
www.irishfoodmagazine.com
4
Issue 2 2015
www.irishfoodmagazine.com
contents
15
16
International
markets
A global agenda
Bord Bia continues to explore new destinations
for future growth of the industry
Ireland’s
34 Verifying
commitment to sustainability
talks with SGS about its role in
Origin Green and verified members tell us
what it means to them
18
Irish beef launches in the US
Ireland is the first European country to
export beef to the US in 15 years
36
21
ABP secures first
US beef deal
Enterprise Ireland partners with
entrepreneurs, Irish businesses, third-level
institutions and investment communities
to develop Ireland’s international trade,
innovation, leadership and competitiveness
ABP Food Group has announced the
first deal to supply beef to the US since
Ireland secured full access for beef to the
market in early 2015
22
China lifts Irish beef ban
Following inspections of Ireland’s safety
control system by Chinese authorities, China
has lifted its ban on Irish beef exports
23
ICM’s in-market investment
leads to growth
Driving expansion in
agri-food exports
investment in Irish
38 €35m
dairy processing industry
Irish Government announces investment in
Ireland’s dairy processing industry ahead of
the abolotion of EU dairy quotas
40 Strategies for global growth
Grant Thornton says careful planning is
needed to successfully manage global growth
Joe Hyland, managing director of Irish
Country Meats credits its success in
the Belgian market to investment in
the marketplace
Group trading
42 Kerry
profits up 4.1%
26
44 The ‘white gold rush’
Silver Hill is
Germany bound
Duck producer, Silver Hill Farms, has
agreed a contract with leading premium
meat supplier to Michelin-starred chefs,
Otto Gourmet
28
Amassing global
milk markets
Kerry Group saw a €25 million
increase in profits in 2014.
Bord Bia recently explored consumer
sentiment in China to understand the
opportunities for Irish infant milk formula
exports
46 Spotlight on...
Veronica’s Snacks
International markets remain a key
target for irish dairy exports as dairy
quotas end on March 31
market
30 Understanding
mores for growth
As Clonakilty Blackpudding continues
to grow its export base it is keenly
aware of the importance of cultural
nuances in its target markets
31
Tapping into a buoyant market
Water may fall freely and frequently from
the Irish skies, but the bottled variety offers
consumers a premium product that is
natural, clean, pure and fresh
www.irishfoodmagazine.com
Issue 2 2015
5
news
Colin O’Brien, Managing Director of Baileys
and Head of Supply with Diageo with the
Minister for Agriculture, Food and the
Marine, Simon Coveney.
Baileys partners with Enterprise Ireland
for brand sustainability
As Baileys, the iconic cream liqueur manufacturer,
celebrates its 40th year of production, it announced a
€600,000 partnership with Enterprise Ireland for its
facility on the Nangor Road, Dublin.
Enterprise Ireland provides funding and supports for
businesses, ranging from entrepreneurs with business
propositions for high-potential start-ups through to
large companies expanding their activities, improving
efficiencies and growing international sales.
Michael Cantwell, head of Enterprise Ireland food
division said: “The €600,000 partnership with Baileys
is part of an Enterprise Ireland strategy that investing
in product and process innovation to improve
efficiencies and grow international sales. Baileys is an
Irish brand with a global presence and a reputation
for excellence which showcases our high quality
dairy and distilling sectors. Today’s partnership will
contribute to Ireland’s dairy sector, exports and to the
Irish economy generally.”
According to Baileys, the investment in its Nangor
Road site, where Baileys is produced and bottled, will
bring the facility to the next level of efficiencies. This
6
Issue 2 2015
includes upskilling employees and upgrading the site
itself, to increase the sustainability of the brand. The
partnership will also enhance the R&D element of this
export-driven brand, with the ultimate objective being
to increase sales and grow the rural economy.
Baileys is the number one selling cream liqueur
in the world and a major contributor to Ireland’s
rural economy. The company, set up in 1974, uses
over 250 million litres of fresh Irish milk annually
and some 82 million bottles of Baileys are sold each
year to 180 countries.
“Baileys has always been an innovative product. In 1974
it set itself apart in a market that was dominated by
whiskey and stout. Today, it is a market leader because
we bring together the very best of dairy and distilling,
while continually exploring new tastes and developing
our marketing approach, production, supply pricing
and innovation strategies. Our partnership with
Enterprise Ireland will ensure that we can continue
to be a number one Irish brand that has appeal right
across the world,” said Colin O’Brien, managing
director of Baileys and Head of Supply with Diageo.
www.irishfoodmagazine.com
news
Glanbia opens €185m Belview facility
A who’s who of Ireland’s dairy industry attended
the official opening o Galnbia’s new Belview
facility – the largest indigenous infrastructure
investment in Ireland in 80 years.
The facility has been designed to the highest
specifications and will manufacture specialised
milk-powder products and nutritional
ingredients to meet the demands of multinationals in infant formula and other industries.
All produce from the new facility will be
destined for export markets.
The high-tech facility is designed to require the
least amount of human interventions possible
during its processes. Two human interventions
take place during the process – the first is when
the milk tank arrives at the facility to deliver the
raw-milk product; the second is the removal, by
forklift, of the final, bagged and sealed product.
Formally opening the plant Taoiseach Enda
Kenny said 2015 will be the year of rural recovery,
led by investments like this one. “This Glanbia
facility will allow Ireland to maximise the job
potential from increased production following
the end of EU milk quotas.”
With support from the Department of Jobs
via Enterprise Ireland, Glanbia Ingredients
Ireland’s invested over €185 million in
the facility, as part of a larger investment
programme valued at €235 million. Belview
will contribute an estimated €400 million
yearly to the Irish economy.
With less than a month till European-wide
milk quotas end, Glanbia was praised for
its commitment to the sector. Minister for
Agriculture, Food and the Marine, Simon Coveney
said: “This flagship investment is a real sign
of confidence in the future of Ireland’s dairy
sector. The project has been made possible by a
decision confirmed during Ireland’s presidency
of the European Union in 2013 to abolish dairy
quotas, and by the vision outlined in the Food
Harvest 2020 strategy.”
CEO of Glanbia Ingredients Ireland Jim Bergin
said the opening of Belview represents the
culmination of a long journey from local vision
to the realisation of the global opportunity
presented by the removal of EU daily quotas.
“This state of the art facility is primed to meet
the global demand for the highest quality,
sustainably manufactured, nutritional Ingredients.
Currently this small island supplies 10 per cent of
the world’s infant milk formula. With the capacity
enabled here at Belview, working closely with the
world’s leading infant formula manufacturers, we
hope to increase milk production by 63 per cent
over the next five years.”
Total Produce acquires 50% shares in Gambles Group
A leading European fresh-produce company, Total Produce plc has acquired a 50 per cent shareholding in the Gambles
Group, the fresh produce company based in Toronto Canada. This represents Total Produce’s fourth North American
investment. Gambles offers a wide range of fresh, local and imported produce that is delivered daily throughout Ontario
to the retail, wholesale and food-services sectors. Commenting on the transaction, Carl McCann, chairman of Total
Produce, which is headquartered in Ireland, said: “We are very pleased to become shareholders in the Gambles Group. This
transaction further broadens our North American operations. We look forward to working with the excellent people in
Gambles over the coming years.”
www.irishfoodmagazine.com
Issue 2 2015
7
news
Current participants in the Bord Bia Business Sustainability Programme Ruth Moriarty, Deirdre Ryan and Philip Cocoman with
recent graduates of the Bord Bia Marketing Fellowship programme, Gareth Murphy, Sales Manager, Keoghs Crisps, and Sonja
Matthews, Glanbia Performance Nutrition.
Irish food industry launches search for 30
ambitious professionals to fly the flag overseas
Bord Bia (the Irish Food Board) and the UCD Michael
Smurfit Graduate Business School are seeking applications
for the Origin Green Business Sustainability Programme.
Participants of the two-year programme will undertake
an MSc. in business sustainability involving a number
of taught modules, which will provide them with expert
knowledge in food sustainability, and a strong insight
and understanding of the Irish food industry at sector
and industry level. They will then be assigned to overseas
markets and/or company placements to promote Origin
Green.The sustainability programme, developed by Bord
Bia, demonstrates the commitment by Irish food and drink
producers to operate sustainably in terms of emissions,
energy conservation, water management, biodiversity,
community initiatives and health and nutrition.
This is the seventh year that Bord Bia and the UCD
Michael Smurfit Graduate Business School has worked
together on overseas programmes that merge academic
learning with practical experience in order to support the
growing Irish food industry. The Origin Green Business
Sustainability Programme is the second initiative from
the two organisations, which also run the Bord Bia
Marketing Fellowship Programme.
To date, more than 150 participants have taken part
in the programmes, working towards a masters
qualification while completing over 600 business
development projects on behalf of Irish food companies
in 13 countries around the world.
Dan Kelly’s Cider to quench German thirst
Dan Kelly’s Cider, a recent addition to the Irish craft cider revival, recently
secured a listing with Manufactum, a prestigious German retailer specialising
in high-quality consumer goods and household items. The retailer places
an emphasis on handmade products. Dan Kelly’s Cider is produced in the
northeast of Ireland, using apples that are harvested on a family farm, Boyne
Grove Fruit Farm. “Manufactum, as a retailer, is defined by the quality of
product it sells, and as such is committed to providing high quality products
produced by sustainable methods,” said Olan McNeece, owner of Dan
Kelly’s Cider. The listing was achieved as part of the company’s participation
in the Access 6 programme, which aims to provide extensive mentoring
and business development for food and drink SMEs in border regions, and
develop new routes to market in the UK and international markets.
8
Issue 2 2015
www.irishfoodmagazine.com
Tipperary
750ML
Produced with pride in the world
renowned Golden Vale of Tipperary,
the heart of Ireland’s finest dairy pastures,
by our master blender, Don Crowley
17% ALC/VOL
“this is the source,
and it is to this green
and misty island
that we turn”
SENATOR JOHN F. KENNEDY
B E F O R E THE I RIS H FELLO WS HIP CLU B O F CHICAG O ,
M AR CH 17 , 19 5 6
interview
Ireland’s international appeal
Ireland has a lot to offer export markets, says Bord Bia (the Irish Food Board),
which is welcoming some 350 overseas buyers to Marketplace International 2015
Foods of Athenry meets
with buyers at Marketplace
International.
D
escribed as speed
dating for businesses,
Marketplace
International will host
a series of one-to-one
meetings between Irish exporters and
buyers, all arranged for one location, in
one day. The event, which takes place in
the Convention Centre Dublin (CCD)
on Thursday, March 26, will see over 170
Irish companies meet with more than 350
buyers from export markets, as well as
almost 150 domestic buyers.
Origin Green
The main theme running throughout the
event is Origin Green, Bord Bia’s nationwide
sustainability programme. All exhibiting
companies are signed up to Origin Green,
and Bord Bia will use the inward visits from
buyers to communicate the Origin Green
message and demonstrate the work of Irish
companies and their commitment to the
area of sustainability.
10
Issue 2 2015
All exhibiting companies have submitted
their sustainability plans, which include
their targets and timelines, to Bord Bia in
advance of the event. Each company’s stand
will also include a personalised Origin
Green message. The presence of such a
large and wide-ranging number of verified
members exhibiting at the show reflects the
strong industry support for Origin Green,
which is a key element of the agri-food
industry’s strategy to be a world leader in
sustainable food production.
A taste of Ireland
Marketplace International will kick-off
with a welcome dinner for overseas guests
on Wednesday evening, March 25. Tara
McCarthy, director of Bord Bia’s food
and beverage division, describes this as
“a food experience” and says this will be
an opportunity for buyers to experience a
variety of Irish food products and will also
include examples of food pairings.
On the morning of Marketplace
International, bus transfers will begin at
6.40am to transport buyers to the CCD
where they will join with the exhibiting
companies, domestic buyers and Bord Bia
representatives for breakfast. The breakfast
will also be attended by Simon Coveney,
the Minister for Agriculture, Food and the
Marine, who will officially open the event.
At 8.30am, the event gets into full swing
with the first meetings taking place.
Meetings are scheduled for every 25 minutes
throughout the day. “At that stage, every
buyer will have received, in advance, their
complete schedule for the day and the Irish
companies will have shared profiles with the
buyers that they will be meeting,” says Tara.
For both a supplier and a buyer, a maximum
of 20 meetings could be scheduled for the
day. Bord Bia will also provide translation
where required. “These are our guests and
we want them to be able to communicate
with people where required. Buyers can flag
their need for translation and we will supply
them as necessary,” says Tara.
Follow-on meetings will also be organised
www.irishfoodmagazine.com
interview
between buyers and exhibitors, and Bord
Bia’s team of international marketplace
representatives will coordinate with
both sides to facilitate this. “There will
be a complete customer relationship
management piece facilitated from the
two ends,” Tara explains, emphasising
the importance of simple, strategic
management of the event.
Food features
During the course of the day, when
buyers have some downtime, Bord Bia
has organised three food features. These
spaces will be divided into three categories:
ambient food, chilled food and frozen food.
“All of those will have tasting sessions,”
says Tara. Every company exhibiting at
Marketplace will have up to two SKUs
featured on those stands where buyers will
have the opportunity to not only see but
also to taste a selection of complimentary
products throughout the day.
New business targets
Marketplace has been running since 2004
and the format is well tested by Bord Bia
and buyers alike. Tara says the event has
proved increasingly successful over the
course of its evolution. Today, new business
targets for the event are five times what
they were when it began over 10 years
ago. Marketplace 2012 was particularly
successful and saw Irish food and drinks
companies double initial targets of €15
million in new business, with €30 million
in new contracts in the 12 months following
the event. This year, Marketplace has
doubled its 2012 target for new business and
is aiming to, once again, see Irish food and
drinks companies achieve €30 million in
new business.
Beyond Europe
Traditionally, Marketplace International has
achieved success in writing new business in
Ireland, the UK and Europe. Now, however,
as the share of exports destined for non-EU
markets is on the rise, Bord Bia is welcoming
a strong contingent of international buyers
from outside Europe. Following the 2013
Sustainability Conference, which saw similar
numbers of international guests, Irish food
and drinks companies were successful
in writing business with buyers from the
Middle East and Asia.
With that in mind, Bord Bia has devised a
new programme for the event that will see
over 190 international buyers attend as part
of an extended, four-day visit to Ireland. The
four-day visit will include sector-specific
itineraries that will allow visitors travelling
from long-haul destinations the opportunity
to witness Ireland’s agri-food industry. It
includes visits to primary producers and
Origin Green verified member companies.
“We are capturing what works for Europe
at Marketplace International and we are
broadening its reach for those international
markets,” says Tara.
What do
buyers think
of Marketplace
International?
An exceptional event, organised
with military precision where, above
all else, we identified a number of
solutions that will contribute to our
top line sales growth
Compass, Ireland
I have rarely had the opportunity
to meet relevant suppliers in such a
controlled environment where the
focus was totally professional and
meant excellent use of time for both
parties
Pan Euro Foods, Dubai
A very well-organised event that
maximised my exposure to Irish
producers in a very tight time frame.
Time well spent
Morrisons, UK
Marketplace International is a great
event, organised in a very efficient
yet personalised manner. This
unique concept enabled me to meet
several Irish food manufacturers in
Dublin in one day that I had preselected based on my sourcing
needs and also to network with
European counterparts. Since
my first participation in 2010 my
company has established strong
and long-term partnerships with
several Irish suppliers, thanks to
the excellence of the Irish food
and drink industry that was able
to fulfil our needs. I would highly
recommend buyers to participate in
this event’s next edition!
Forezia, France
An outstanding and well-organised
event that brings benefit to
suppliers and buyers alike
Gulf Irish Food Traders, Bahrain
www.irishfoodmagazine.com
Issue 2 2015
11
industry
Making the right
noise at Marketplace
In advance of Marketplace International,
speaks with some
of the Origin Green verified members exhibiting to find out what
visitors can expect at at this year’s show on March 26
Dawn Farms
Dawn Farms is a leading European
supplier of cooked and fermented meat
ingredients to the foodservice and
manufacturing sectors.
At Marketplace 2015, Dawn Farms is
featuring its Dawn Farms ready-to-order
foodservice range. This, the company
says, has been developed to showcase
the tastes of its most popular cooked
and fermented ingredients, including
pizza toppings. The company says
it is interested in meeting potential
distributors for this range, which includes
Halal products, and is targeted at the
independent foodservice sector.
Innovation is one of the building
blocks of Dawn Farm’s business.
It has its own innovation process,
called NECTAR, providing a
pipeline of new menu ideas based
on consumer insights and 30
years’ experience and expertise
as a specialist B2B cooked-meat
ingredient company. Its distribution
partners for its foodservice range
have access to its Chefs Hub, which
provides the latest trends and recipe
ideas to help grow business.
As an Origin Green-verified member,
Dawn Farms says membership has
had a truly positive impact on its
business. Per tonne of product
produced, it now uses 27 per cent
less MWh energy, 32 per cent
12
Issue 2 2015
less M3 of water, has reduced its direct
scope 1 carbon emissions by 18 per
cent and sends zero waste to landfill.
It also sources its ingredients more
sustainably, having removed palm
oil from its product specifications,
switched to free-range egg as an
ingredient and employed a policy of
not sourcing from areas subject to
deforestation.
It has also made progress in making
its products healthier. By targeting
the FSA guidelines, Dawn Farms has
significantly reduced the amount of
salt in its products. In addition, no
products contain artificial colours,
MSG or added hydrogenated fats and
the majority can carry the nutrition
claim of ‘low sugar’, containing less
than 5g of sugar per 100g. In 2013,
Dawn Farms was awarded the Irish
Exporters Association Sustainable
Exporter of the Year Award and,
last year, together with two sister
companies at the Naas Food campus,
was awarded the prestigious
Industry Category Award at the
Sustainable Energy Ireland Awards.
Dawn Farms currently has agency
www.irishfoodmagazine.com
industry
agreements in place in markets including
the UK, France and the Netherlands,
and is interested in meeting potential
partners from other EU countries to
discuss opportunities.
Merrys
At Marketplace International 2015, Irish
cream liqueur manufacturer Merrys will
be promoting its rebranded Merrys Irish
Cream liqueur. It has also added three
new flavours to its portfolio, including:
Atlantic Sea Salted Caramel, Pumpkin
Spice and Toffee Buttermint.
Merrys is investing €2.5 million in a new
bottling line and upgrading its facility
in Clonmel to ensure that it has plenty
of capacity for future growth in markets
around the world.
At Marketplace, Peter Cooney, Merrys’
export sales director, will be presenting
details of the company’s new state-ofthe-art distillery and brewery facility in
Drogheda. The new facility includesa
a bottling, canning and kegging line
for its beers and ciders. There will also
be a visitor centre capable of receiving
200,000 visitors per year.
Merrys says its experienced and passionate
people sets the company apart from its
www.irishfoodmagazine.com
competitors. Don Crowley, Merrys’ liqueur
blender, has over 35 years’ experience in
making liqueurs and has been responsible
for many of the company’s successes in
international awards of excellence. Its
distiller and brewer, Aine O’Hora, has over
nine years’ experience in making beer and
whiskey. She has brewed in craft breweries
and large-scale breweries in Australia and
has been behind the creation of many
successful brands. Merrys’ cider maker, Pat
Kearney, has been making cider for over
21 years and planted all of the company’s
bittersweet cider trees.
Merrys recently became an Origin
Green verified member and is making
proactive decisions about its suppliers. It is
sourcing materials from suppliers that are
sustainability-conscious. It is also reducing
its waste in order be more environmentally
friendly while focusing on recycling and
energy-efficiency awareness.
Merrys has its sights set on markets in
Japan, Australia and the UK where it
plans to launch its beers, ciders, liqueurs
and whiskeys.
Glanbia ingredients Ireland (GII)
Glanbia Ingredients Ireland (GII), Ireland’s
largest dairy ingredients company, will be
participating in Marketplace International
with a view to sharing its capabilities
across a broad range of top-quality dairy
and nutritional ingredients. The company
supplies quality dairy products into blue
chip companies around the world, across
a variety of sectors including infant
formula, clinical nutrition and branded
dairy products such as cheese and butter.
It is also a significant supplier of enriched
milk powder in consumer-ready formats
to markets in West Africa, the Middle East,
Asia and Central America.
At Marketplace International, GII will
be meeting buyers who are looking for
value-added ingredients. The company
will be communicating its strength in
the marketplace as it draws from its
fully-owned milk pool of 4,800 farmers
and their dairy herds. From this source,
it produces top-quality dairy products
from grass-fed, pasture-raised animals
providing for fully-traceable and
sustainably-produced ingredients.
GII is a founding member of Origin Green.
To help prepare its milk suppliers to meet
the SDAS (Sustainable Dairy Assurance
Scheme) standards, its expert milk
advisory team works closely with farmers
on milk quality, sustainability and farm
development, as well as planning for the
future in terms of finances, expansion and
succession planning. This has led to the
launch of GII’s Open Source Sustainability
and Quality Assurance code, whereby its
sustainability team works closely with its
farmers, offering support across many areas
of sustainable dairy farming, including: milk
quality; animal health and welfare; soil and
grassland management; energy efficiency;
carbon emissions; health and safety on
farms; and more.
GII says it remains at the forefront of
ingredient innovation by constantly
investing in technology, infrastructure, and
industry expertise. The company’s ethos
is that innovation should be driven by the
quality of its people and the way that it
collaborates with customers. The launch
of Ireland’s flagship dairy facility – the GII
Nutritional Ingredients plant in Belview
– puts GII in a prime position to use its
growing milk supply, post-quota abolition,
in the manufacture of specialised powders
and nutritional ingredients for the infant
formula and health and wellness industries.
Issue 2 2015
13
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focus
International Markets
www.irishfoodmagazine.com
Issue 2 2015
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A global agenda
International markets led growth for Irish food and drink exports
in 2014. Bord Bia (the Irish Food Board) is continuing to explore
new destinations for future growth of the industry
I
rish food and drink products
are currently available in 180
countries around the world and
their presence is on the rise.
In 2014, the value of Irish food and
drink exports rose by 4 per cent, marking
the fifth consecutive year of growth for
the sector. While reaching €10.5 billion in
exports was a milestone for the industry,
there remains a continued focus on
international growth within the category.
The industry has a clear agenda in place
for continued growth. In 2010, it launched
its Food Harvest 2020 programme with a
goal of achieving €12 billion in food and
drink exports by 2020. Five years out from
that deadline and Ireland is already well
on its way to meeting its targets. Now, in
consultation with industry, the Department
of Agriculture, Food and the Marine is
currently preparing a national strategy
for the agri-food sector up to 2025. This
will outline the key actions required to
ensure that the agri-food sector (primary
agriculture, the food and beverage industry,
fisheries and fish processing, forestry
and forestry processing) maximises
its contribution to overall economic
growth, job creation and environmental
sustainability over the coming decade, and
builds upon the progress achieved under
Food Harvest 2020.
It is currently anticipated that the draft
2025 Agri-Food Strategy Committee
report will be presented to the Minister by
the end of June 2015.
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Issue 2 2015
Volumes and values
Higher export volumes were reported in
key categories in 2014. Milk deliveries were
almost 6 per cent higher during the first
10 months of the year; meanwhile beef
volumes rose by almost 13 per cent due
to stronger supplies and higher carcass
weights; and pigmeat export volumes were
almost 7 per cent higher.
According to Bord Bia (the Irish Food
Board), the combined impact of higher
output across the main product categories
in 2014 is estimated to be in the region of
€500 million. However, difficult market
conditions meant values for many key
categories were down for the year.
Speaking at the launch of export figures
for 2014, Aidan Cotter, CEO of Bord Bia
praised the tenacity of the food and drink
industry, which, despite a challenging
trading environment, continued to grow
the value of its exports. Traditional export
destinations experienced a largely static
consumer price inflation, which, Aidan
said, held the value of Irish exports at
€10.5 billion.
Overall, despite the challenging
environment in Europe, exports to
European markets continued to grow by 2
per cent. The UK remains the number one
destination for exports, accounting for 40
per cent of overall exports. While its share
of the exports declined from 2013, values
remained stable at €4.2 billion. Markets
in Germany, Spain and Sweden saw lower
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trade during 2014; however, this was offset
by strong performances in key markets such
as France, Italy, Poland and the Netherlands.
Beyond Europe
While traditional market growth eased in
2014, Aidan commended the industry’s
tenacity. He said its commitment to
exploring new markets outside the EU
is paying dividends and is offsetting the
limited growth in established markets.
Optimism in future growth, he continued,
is high among exporters. Ireland is
seeing growth in non-European markets.
Shipments of food and drink products to
international markets showed renewed
growth in 2014, according to Bord Bia, as
the value of trade jumped by an estimated
15 per cent to stand at around €3 billion.
International markets accounted for 29 per
cent of total export values.
Asian markets, in particular, are
beginning to pick up pace, with exports
to the region up 45 per cent on 2013
figures. Growth in Asia is expected to
continue as population growth is strong
in these markets and consumer-spending
power in the region is on the rise.
As well as Asia, good market demand
in the Middle East, North America
and Africa helped to offset ongoing
competitive pressures evident across
European markets where consumer
sentiment remained fragile.
Confidence in industry
Bord Bia’s annual industry survey,
published in December 2014, shows
there is strong optimism among food
and drink manufacturers across all
categories. Interestingly, the respondents
were confident about growing export
sales through relationships with
new customers. Some 41 per cent
of respondents said new customers
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presented opportunities for growth over
the next three years. New customers for
existing products were identified by 69
per cent of respondents as a potential area
of growth, compared to 42 per cent of
respondents who believed customers of
existing products would drive growth.
When it comes to new products, 33 per cent
of respondents showed more confidence in
new client opportunities, while 32 per cent
believed existing customers would drive
sales growth of new products.
High-value position
Reflecting on export performance in 2014,
the Minister for Agriculture, Food and
the Marine, Simon Coveney, said Ireland’s
food and drinks industry was a role model
for other industries. Since 2009, exports
from the food and drinks industry have
grown by 45 per cent, compared to Irish
merchandise exports, which grew by 5 per
cent in the same period.
The Irish agri-food industry, the Minister
explained, has carved out a niche position
in international markets. “Ireland will never
feed the world, but we can feed a portion of
the world’s population who are demanding
high-end products that have a high-quality,
added-value offering.”
The focus on added-value production
in Ireland is very exciting, according
to the Minister, who said there is a
strong commitment from the industry
in continuous innovation and
technology advancements.
Ireland is also setting itself apart and adding
value to its exports through its commitment
to sustainability and the Origin Green
sustainability initiative, he added. Ireland’s
work in the area of sustainable food
production, he continued, is creating a
template internationally for best-practice
in the agri-food. “Ireland continues to
offer leadership based on independent
certification,” said Minister Coveney.
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Irish beef
launches in the US
Ireland is the first European country to export beef to the US in 15
years and the industry joined Bord Bia (the Irish Food Board) recently
in New York and Boston to officially launch Irish beef in the market
N
ews that Irish beef is to
be the first European
beef on sale in the
US for 15 years was
warmly welcomed
at the beginning of 2015. Buoyed by
the good news, the industry gathered,
during a three-day visit, organised by
Bord Bia, with key State-side personnel
to officially launch Irish beef in the US.
The visit by Irish beef producers was led
by the Minister for Agriculture, Food
and the Marine, Simon Coveney. The
Minister described the visit as the perfect
opportunity to “market Irish beef to
premium buyers, distributors and opinion
formers. These high-profile opportunities
are the next step in targeting the US
market, now that market access has been
acquired and leading Irish exporters
seek to secure business both during and
after this trip. We’re benefitting from the
endorsement of some of the best Michelin
star chefs whose commitment to Irish beef
gives it a prestige unparalleled elsewhere.”
Chef’s choice
The highlight of the first day of the
visit was Bord Bia’s high-profile launch
event at Daniel, one of New York’s most
prestigious Michelin-star restaurants.
Guests were treated to an exceptional
Irish beef demonstration by two-star
Michelin chef, Jean Paul Jeunet, the chef/
owner of Jean Paul Jeunet, in Arbois,
France, and Dublin-born Chef Cathal
Armstrong, the chef/owner of Restaurant
Eve in Washington. Among the dishes
Minister for Agriculture, Food and the Marine, Simon
Coveney marks Ireland’s entry to the US beef market with
a three-day visit to New York, Boston and Washington.
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Issue 2 2015
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Minister for Agriculture, Food and the Marine, Simon Coveney,
accompanied by Ambassador of Ireland HE Anne Anderson and
Department officials during his meeting with his US counterpart,
secretary for agriculture, Tom Vilsack in Washington DC.
Premium quality
served were: Irish beef tenderloin tartare
with oyster gelée and Irish beef tenderloin
and foie gras carpaccio with black truffles
and hazelnuts. “Irish beef is the choice
of some of the world’s leading chefs with
over 80 Michelin-star chefs in Bord Bia’s
Chef’s club. Their endorsement tonight
will provide further evidence to the US
audience that Irish beef is unique in terms
of flavour, taste, texture and tenderness,”
the Minister commented.
The event was attended by over 100
leading US chefs and New York-based
media including the New York Times and
Good Morning America.
Bilateral meetings
During the visit, the Minister also held
a number of bilateral meetings with key
US food buyers, including Walmart and
DeBragga, to highlight the premium
offering that Irish beef offers consumers.
All of the leading Irish beef exporters
accompanied the Minister on this
promotional tour where they met with
potential customers. The Minister said:
“Working with these large-scale buyers
and distributors will be key to building
the sales of Irish beef across the US. I’m
confident that we will see some business
collaborations coming out of these
meetings, which will mark the first tangible
benefits of our securing beef access.”
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Launching the Bord Bia US-market strategy,
Bord Bia Chief Executive Aidan Cotter
said the focus will be on highlighting the
premium quality of Irish beef and the
sustainable production practices of Irish
beef producers and processors. The initial
objective, he said, is to build awareness,
gain recognition and secure advocates for
Ireland’s grass-fed natural beef. “Our 16year absence from the US market provides
us with a blank canvas on which to write the
story of Irish beef for an expectant audience.
We will concentrate our immediate
attention on the northeast, mid-west and
southeast regions, with a primary focus on
specialist meat distributors, fine dining chefs
and premium grocery chain buyers.”
Bord Bia also launched a new consumer
facing website to educate US consumers on
the merits of Irish beef.
Global success
On day two of his visit, the Minister
addressed both the World Bank and
the School of Advanced International
Studies, John Hopkins University, in
Washington DC. During his speeches,
the Minister highlighted the ambitions
of Ireland’s agri-food industry.
“Our Food Harvest 2020 strategy five
years ago set out a plan for the smart,
green, growth of the Irish agri-food
sector. This industry-developed plan has
been very successful in providing a vision
and a road map for the development of
Ireland’s agri-food sector.”
The Minister continued: “Last year,
Ireland’s agri food exports reached a
record value of almost $12 billion. That’s
about 10 per cent of the value of US
agri exports, but I think you will agree, a
significant achievement for a country that
is half the size of New York State, with only
a quarter of its population.”
Furthermore, the Minister said that Ireland’s
reputation for the highest standards of food
safety and traceability have underlined its
export success. “I am pleased that those
standards have been recognised by USDA, in
approving Ireland as the first EU country to
export meat to the US in over 15 years.”
Origin Green
The Minister also took the opportunity to
comment on the commitment of Ireland’s
agri-food industry to operating sustainably,
which he said was at the heart of sector. He
highlighted his ambition that Ireland should
be, and be seen to be, a global leader in
sustainable food production and explained
the Origin Green sustainability programme,
which commits the sector to produce more,
using less. “I am particularly pleased that the
World Bank is currently hosting a Bord Bia
Origin Green Ambassador, Shane Hamill,”
the Minister noted.
Issue 2 2015
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“We are also making our
Government-sponsored expertise
available to partner governments
internationally,” the Minister added,
referring to the establishment of
Sustainable Food Systems Ireland.
Positive feedback
A second Irish beef launch was held
in the Irish Ambassdor’s Residence in
Washington that evening. Once again
over 100 guests were treated to an
impressive array of Irish beef dishe,
while Ambassador Anne Anderson
welcomed the guests.
The Minister ended his three-day
visit to the US in Boston with a
third, and final, Bord Bia launch,
hosted in the iconic beef restaurant,
Smith & Wollensky, famous in the
US for the quality of its steak dining.
“When it comes to the strategy for
marketing of Irish beef in the US,
Boston is an obvious choice, given
its strong links to Ireland and its
reputation for fine dining.” The
Minister continued: “Hosting the
event at an iconic US institution like
Smith & Wollensky will resonate
hugely with the population here. I was
delighted also that today’s function
had a focus on the hospitality sector,
with managers from all of the major
hotel brands present.”
The Minister said the feedback from
key US buyers and distributors of
beef, who he had met during his
visit, was overwhelmingly positive.
“There is a specific, high-end market
opportunity for premium-quality,
grass-rich, hormone-free beef. Irish
beef ticks all those boxes and, in
addition, comes with the guarantee
of the highest food safety, quality and
traceability standards.”
The Minister also praised the
work of Bord Bia for putting
in place an exciting marketing
strategy to help Irish exporters
reach US buyers and consumers.
“I’m confident that this week is
just the start of an exciting new
chapter in the great story that is
Irish beef.”
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Issue 2 2015
Michelin-star chef
and Chefs Irish
Beef Club member
Pierre Caillet
prepares Irish beef
at the Winners
Event in Sirha.
Irish beef on the menu at Sirha
Irish beef was among the products available to prestigious international
chefs at a Bocuse d’Or Winners Evening at Sirha 2015.
In 2013, Irish beef was selected as the main meat dish for the prestigious
Bocuse d’Or chefs competition at Sirha, presided over by the famous French
chef Paul Bocuse. At Sirha 2015, previous winners of the Bocuse d’Or and their
product partners, of which Bord Bia is one, were invited to a Winners Evening.
The event is an another opportunity to showcase Irish beef to an elite network
of top chefs and food media personalities. This year, two special Irish dishes
created by Michelin-star chef Pierre Caillet, a member of the Chefs’ Irish Beef
Club, were presented at the event:
• Irish beef tartare Normandy style accompanied with crispy onions,
Normandy cider and mustard; and
• Mini Irish cheek-meat burgers (marinated in Guinness) and served with an
organic, Irish mild-cheddar cheese from the Little Milk Company.
Commenting on the event Noreen Lanigan, Bord Bia director for France
said: “Over 250 of the who’s who in the culinary world attended this Winners
Evening. This influential network of chefs and food media had the opportunity
to taste top-quality Irish meat and experience its versatility, this can only be
positive for our reputation in the international food service arena.”
Six Irish meat companies attended Sirha on the Origin Green Ireland stand,
where Bord Bia facilitated business meetings and arranged product tastings
for key customers. The focus at the stand was on highlighting the work of
Origin Green, Bord Bia’s sustainability programme, as well as providing details
on the Chef’s Irish Beef Club and the Bord Bia Quality Assurance Scheme.
“Sirha provides an ideal platform for Irish exporters to secure new business
and deepen relationships with existing French and international customers,”
Aidan Cotter, CEO of Bord Bia commented at the event. “France is our largest
Eurozone market for beef and, at €260 million, accounts for 23 per cent of
Irish beef exports to continental Europe. It is also our biggest export market
for sheepmeat with a value of €90 million or 42 per cent of our total global
sheepmeat exports. This endorsement from a country renowned for its
culinary tradition and fine-dining tradition will enhance our attractiveness to
the non-French presence at Sirha, who account for 13 per cent of visitors.”
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ABP secures first US beef deal
ABP Food Group has announced the first deal to supply beef to the US since
Ireland secured full access for beef to the market in early 2015
A
BP Food Group, a leading
Irish beef processor and
exporter, has agreed to
source Irish beef for
Sysco Metro New York
and Sysco Boston. This makes it the first
Irish company to secure an export deal in
the US since Ireland secured full access for
beef to the market in early 2015.
Initially, Sysco will focus distribution of
ABP’s beef products in steak houses and
restaurants in both New York and Boston.
“Our initial focus will be on the northeastern region of the US where we will
concentrate on establishing Irish beef in a
sustainable and measured way,” said Paul
Finnerty, CEO ABP Food Group.
He added: “I would also like to commend
the work of the Minister, the Department of
Agriculture, Food and the Marine and Bord
Bia (the Irish Food Board) in helping to
achieve the significant milestone for the Irish
beef sector.”
€15 million value
Taste and quality
The relationship between ABP and Sysco’s
New York and Boston distribution centres
was facilitated by Ireland-based Pallas
Foods, a subsidiary of Sysco Corporation.
When fully protracted, ABP believes the
agreement could be valued at up to €15
million per year. The first shipments are
expected to commence in March.
“We look forward to developing and
growing our partnership with Sysco,
which will be key to helping us bring
our sustainable, grass-fed, hormone-free
Irish beef to the plates of US consumers,”
Paul added. “We greatly appreciate the
efforts made by Tadhg Geary and Pallas
Foods in helping build this international
partnership.”
The announcement was made during
the recent visit to the US by the Minister
for Agriculture, Food and Marine,
Simon Coveney, Bord Bia and key
industry personnel. Commenting on
the announcement, the Minister said: “I
am delighted with the announcement of
this deal between ABP and Sysco. This
represents the first sale of Irish beef into the
US since we regained access to the market
and no doubt will be the first of many such
deals for Irish companies. ABP can be very
proud to be the first European company
selling beef into the US in 15 years and
I congratulate Pallas Foods also on their
role in this. Partnering with large US food
companies like Sysco is the perfect way to
bring the taste and quality of Irish beef
to US consumers and I wish them every
success in this venture.”
Mike Scanlan, vice president Sysco,
New York; Mark Goodman, international
commercial director, ABP; and Tara
Maguire, US sales manager, ABP.
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Issue 2 2015
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Changfu and his colleague Minister Shi
Zhuping, who is responsible for inspection
and quarantine, agreed at that time to send
a veterinary inspection team to Ireland.
This inspection followed last December,
and the Irish food safety control system
passed with flying colours. I want to thank
the Chinese authorities for following
through on their commitment, and
delivering an outcome which paves the way
for Irish beef access to China.”
Valuable market
China lifts ban
on Irish beef
Following inspections of Ireland’s safety
control system by Chinese authorities, China
has lifted its ban on Irish beef exports
T
here was further good news
for the Irish beef industry
in early 2015 as China
announced it has lifted its
ban on Irish beef. The news
followed hot on the heels of the recent
launch of Irish beef in the US for the first
time in more than 15 years.
Commenting on the development, the
Minister for Agriculture, Food and the
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Issue 2 2015
Marine, Simon Coveney said this was a
very significant advance for the Irish beef
sector. “This announcement follows on
intensive political, technical and diplomatic
engagement with the Chinese authorities
over several years. We made a significant
breakthrough last November when I led a
major trade mission to China, involving
Irish leading beef companies. My Chinese
agriculture counterpart Minister Han
China is currently the second biggest
destination for Irish food exports, after
the EU. The value of agri-food exports
from Ireland to China (including Hong
Kong) last year amounted to almost €620
million according to CSO trade statistics,
a remarkable increase of almost two and
a half times the level of exports in 2011.
Referring to the opportunity for beef
exports to China, the Minister said that
Chinese beef consumption is estimated at
approximately six million tonnes at present
and is expected to grow by over one million
tonnes over the next five years. “Increasing
demand for beef in China will be driven
by urbanisation, increasing affluence and
especially by the westernisation of Chinese
diets. There is market potential not only for
beef offals, but increasingly for high-quality
steak cuts and for traceable manufacturing
beef for the expanding fast food sector. This
announcement will pave the way for Irish
operators to get a share of that market.”
Next steps
The announcement is seen as a huge
endorsement of the food safety standards
in Ireland given China’s well-known strict
standards and cautiousness in providing
market access.
While China has formally lifted its ban
on Irish beef, the next step in the process
will involve the agreement of a protocol
to determine, inter alia, which cuts can
be exported and the agreement of a
veterinary certificate. This will be followed
by a Chinese veterinary inspection to
approve individual processing plants
for export. Minister Coveney said that
his Department would be continuing its
technical engagement with the Chinese
authorities to ensure that this process is
concluded as soon as possible.
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ICM’s in-market investment
leads to growth
Joe Hyland, managing director of Irish Country Meats (ICM) credits its
success in the Belgian market to investment in the marketplace
I
CM, a verified member of Origin
Green and Ireland’s largest
sheepmeat processor, which is the
specialist sheepmeat processing
arm of the Linden Food group,
has been making significant gains in the
Belgian lamb market.
According to Joe Hyland, managing director
of ICM, the most important development
in the Belgian market, from a market
penetration perspective, was the 2011
purchase by ICM of A. Lonhienne Sprl,
Belgium’s leading lamb specialist processor.
“Strategically, this acquisition positioned
ICM as the largest lamb-service provider in
Belgium, numbering many of the leading
Belgian retailers and foodservice customers
as existing clients. Subsequently, ICM
has worked with our Belgian colleagues
to consolidate our market position and
develop a marketing strategy fit-for-
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purpose in Belgium.” This includes a €1
million investment programme in a plant
and systems upgrade.
ICM’s structure in Belgium, through the
A. Lonhienne proposition, represents the
only integrated farm to fork processing
and service provider platform in Belgium,
says Joe. “We have been communicating
this message to the market with some
success since acquiring the business. We are
proud to be part of A. Lonhienne’s 50-year
success story as specialist lamb processors
in Belgium as we celebrate their 50th
anniversary in the current year.”
A development hub
ICM services 30 international markets,
with the largest distribution in France. Joe
says the ICM acquisition of A. Lonhienne’s
business has created a procurement and
supply platform capable of meeting all
market requirements. ICM also plans to
use the facilities as a hub to service not
only the Belgian market but also other
European markets. “It is our ambition
to grow our base in Belgium and to use
the Belgian platform for distribution and
market penetration of Irish lamb into
other markets.”
Headquartered in Liege, A. Lonhienne is
strategically well-positioned in its proximity
to Holland, Germany and France. According
to Joe, the facility and fleet of vehicles,
coupled with a multilingual team with
expertise in logistics management, presents
an opportunity to establish a European
distribution platform to facilitate the future
growth and development of the Linden
Food group members – Linden Foods,
Slaney Foods, Irish Country Meats, and
Lonhienne – into the future.
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Value-added
Joe explains that the A. Lonhienne
acquisition is part of an ongoing exercise
of moving up the value-chain, resulting in
a progressive shift in sales of carcasses to
value-added, processed products.
“Our brands, Slaney Valley and Irish
Country, are well-positioned in retail and
foodservice distributors on and off the
island,” says Joe. “In a retail context, we
have partnered with leading retailers in all
our major markets to bring an innovative
and crafted solution tailored to specific
market demands.”
Continued innovation in the category is
at the heart of the ICM business and the
company has made significant investments
over the past decade in infrastructure and
resources. “In 2012, we opened the first
discovery and innovation centre specialising
in lamb in Europe to ramp up our
commitment to continuous improvement
and service responsiveness to our
customers. We offer every form of product
and packing configuration to the market
in the pre-cook segment, with associated
industrial processing capability. Product
and process innovation is an exciting
challenge, requiring disciplined focus within
24
Issue 2 2015
the manufacturing model. However, the
ultimate reward, in terms of product and
market evolution, securing new product
listings etc., justifies all of the hard work and
commitment.”
A great story to tell
As part of its commitment to innovation,
ICM is a verified member of Bord Bia’s
(the Irish Food Board) sustainability
programme Origin Green. “We are both
members and big fans of Origin Green,
and we are hugely committed to the
Origin Green project,” says Joe.
Sustainability, he explains, is
developing momentum in all of ICM’s
markets, in particular its developed
markets. He describes Origin Green
as a successful communication tool
to articulate the positive attributes of
Ireland’s agri-food environment.
“Independently validating the green
credentials and natural food production
environment of Ireland is one of the most
tangible marketing exercises undertaken
by industry in recent years. We have a great
story to tell, let’s shout it from the rooftops.”
Joe adds that customers relate to the
authenticity of ICM’s sustainable
mission and it is already delivering
traction and commercial advantage for
the company in the marketplace. “In
Belgium and, indeed, all of our major
markets we have actively communicated
the Irish sustainability mission as part
of our marketing exercise. This includes
a programme of inward buyer visits to
Ireland, which has been very successful.”
Sustainability begins at farm level, Joe
says, describing farm visits and farm
families as the cornerstone of such a
successful programme. “Farmers are the
real ambassadors for Irish food production.
Nobody communicates better the passion,
commitment and hard work associated with
the production of livestock.”
High regard
Ireland has a long tradition of lamb exports,
with 70 per cent of total production
exported to over 30 markets worldwide but,
principally, in Europe. Joe says Irish lamb
is highly regarded in the European
marketplace and well-perceived, both by
customers and consumers. “Market research
conducted by Bord Bia in France concluded
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that Irish lamb ranked as the preferred
import provenance, second only to
native French-produced lamb.”
He continues: “We are renowned
worldwide for our levels of rainfall,
linking this reputation to an abundance
of fresh, green grass and clean
production environment is both true
and astute in a marketing context.”
Challenges
While Irish sheepmeat production and
sales performed well in 2014, the market
remains challenged. “The so-called ‘grey’
or traditional consumer represents the
core support group of our product,”
Joe explains, saying market research
shows that younger consumers do not
understand how to cook, prepare or,
indeed, choose lamb. “Price is also a
factor as lamb is the most expensive
protein. In Ireland, lamb consumption
has been stable due to a combination of
strong promotional activity by retailers,
coupled with innovations from a
product perspective.”
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In 2014, Bord Bia announced plans for a
three-year, European-based, lamb promotion
campaign, which will begin in 2015. The
€7.7 million campaign will run across six
European countries to encourage people
to cook with lamb. Bord Bia (Ireland),
EBLEX (England) and Interbev (France)
are undertaking this initiative, following a
successful joint application through their
national authorities for matching funding
under the European Union promotion fund.
Commenting on the funding, Joe says: “I am
particularly pleased with the announcement
of this funding approach given that, as
chairman of the European Sheepmeat
Processors Association (UECBV), I was
centrally involved with other stakeholders in
persuading the EU Commission to change
promotional funding support regulations to
include the generic promotional possibilities
that now exist. Europe is only 80 per cent
self-sufficient in lamb production and
trending downwards. Sheepmeat production
is now considered to have sensitive status
within the EU and, therefore, is receiving
some additional attention within the broader
framework of the CAP.”
Issue 2 2015
25
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Silver Hill is Germany bound
Duck producer, Silver Hill Farms, has agreed a contract with leading
premium meat supplier to Michelin-starred chefs, Otto Gourmet
so we believe that we can position our
products in the German market at this level.
“By targeting partnerships with
companies like Otto Gourmet, we are
getting access to the top-end restaurant
customers that will appreciate the
difference in the quality of our duck.”
Barry adds that the company’s participation
in Origin Green is a very nice fit with the
German consumers’ appetite for purchasing
products that are sustainably produced
and from companies that focus on the
environment.
Growth on the agenda
Founders of Monaghan-based Silver Hill Farm,
Ronnie and Lyla Steele meet Wolfgang Otto, owner
of Otto Gourmet Germany with Eavan Fallon, Bord
Bia marketing fellow based in Germany.
S
ilver Hill Foods, an Origin
Green verified member,
processes more than four
million ducks each year. The
company exports 80 per
cent of its products to the UK, continental
Europe, the Middle East and the Far East.
Silver Hill Foods also recently secured a
new listing for the German market with
Otto Gourmet, a premium-meat supplier
to Michelin-star chefs.
The agreement was secured by Bord Bia
Marketing Fellow, Eavan Fallon, who is
currently working on business development
assignments on behalf of a number of Irish
food and drink companies in the country.
Targeting the market
According to Silver Hill, Germany is a key
target market, as Irish brands already have
a strong brand presence in the market and
Ireland’s credentials as a food-producing
26
Issue 2 2015
nation are second to none. Stuart Steele,
managing director, Silver Hill Farm said:
“We identified Germany as a key market
for us to break into and so we have been
involved with the Bord Bia marketing
fellowship programme for the last number
of years, working with a fellow placed in the
market to identify new sales opportunities
for fresh and frozen duck products in
Germany. This relationship has recently
produced excellent results as is evident with
this news from Otto Gourmet.”
The company is now planning to grow
sales in retail and food service in Germany
to in excess of €1 million in the next three
years. Over the coming months, Eavan,
will work closely with the company to
deliver a sales and promotion drive for
Silver Hill in Germany.
Barry Cullen, head of sales, Silver Hill Foods
says: “We are offering a premium product
that is widely acknowledged as the best duck
in the world by our Chinese customers,
Silver Hill has delivered strong growth in
international markets in recent years. The
company maximises its opportunities by
utilising its duck outputs completely – it
exports its duck feet, heads and necks
to Hong Kong, where they are sold as
delicacies; its duck liver and fat is sold to
Belgium to make pâté; the duck feathers
are sold in Poland; while its cooked-duck
products are sold all over Europe and
South Africa.
Silver Hill also exports a range of Halalcertified products to the Middle East, which
are valued at approximately €500,000.
In 2011, Silver Hill Foods set out a fiveyear business strategy to double the size
of the company by 2016 and the company
says it is already ahead of that target. As
an export-orientated company, Silver
Hill has seen a lot of the growth from
entry into new markets and expanding its
range in existing markets. In the past 12
months, Silver Hill has secured a number
of new customers in Singapore and is
planning to target its expansion in the Far
East from a base in Singapore.
“I have recently returned from Singapore
and met with a number of logistics firms
that can facilitate having an operation based
there,” says Barry. “This will allow us to
target mainland China, Thailand, Indonesia,
Malaysia and Australia for the next phase of
our growth over the next 12-24 months.”
www.irishfoodmagazine.com
focus
Amassing global
milk markets
I
International markets remain a key target for
Irish dairy exports as dairy quotas end on March 31
n 2014, Ireland exported over €3
billion worth of dairy products
and ingredients to 140 countries
worldwide. Furthermore,
dairy-based enriched powders
accounted for an additional €710 million.
In total, dairy-based outputs account for
close to one third of the total value of Irish
food and drink exports.
Future production
Ireland’s geographic setting, on the northwest periphery of Europe, makes it an ideal
location for producing sustainable, grassbased dairy outputs. The island has one of
the lowest water-stress measurements in the
world, and the temperate Atlantic weather
conditions contribute to a yearly grass
growth that exceeds the European average
by more than one third.
The continued availability of permanent
grassland is an important feature for the
dairy industry as Ireland prepares for
the end of quotas in March 2015. The
Irish Government’s agri-food strategy,
Food Harvest 2020 includes a target of a
50 per cent increase in milk production
from the base period (2008/2009) out to
2020. If Ireland delivers on these targest
over the next five years, Ireland will be the
fastest growing dairy producing nation
in the world. Ireland’s dairy industry will
continue to be an important contributor
to the overall value of Irish food and
drink exports, which stood at €10.5
billion in 2015.
Growing markets
While the UK remains Ireland’s largest
market for dairy outputs, international
markets are proving increasingly important
28
Issue 2 2015
as exports to non-EU companies grew by
20 per cent in 2014. International markets
now account for 40 per cent of dairy
exports, with trade worth an estimated
€1.24 billion in 2014.
Asia, in particular, is leading the way for
this growth and, in 2014, the value of dairy
exports to the region increased by 30 per
cent to reach €530 million. China accounts
for two thirds of this value.
Chinese demand for high-quality dairy
products has seen it quickly evolve from the
thirteenth most important destination for
Irish dairy outputs, in 2008, to the second
most important market in 2014.
In 2014, Ireland’s dairy industry achieved
100 per cent compliance during an
audit by Chinese authorities, following
the introduction of tighter food safety
regulations. Under the new rules, any
company wishing to export dairy
products, i.e. milk, cheese, long-life (UHT)
products, etc., to China must register their
details with the Chinese authorities.
The Minister for Agriculture, Food
and the Marine, Simon Coveney
described Ireland’s 100 per cent
compliance rate as further evidence of
the value placed on Irish dairy exports,
as well as the importance of Irish
regulatory standards.
Irish investment in China
Irish dairy producers recognise the
growing importance of the Chinese and
broader Asian market. In 2014, during
a Government-led trade mission to the
region, several leading Irish dairy producers
announced investment in people, products
and resources in the region.
Glanbia PLC launched its branded
Avonmore milk in the Chinese market with
a UHT product. Glanbia partnered
with Milkmore, a local distributor
and retailer of dairy products in
China based in Shanghai, which will
distribute the product in market. Demand
for imported UHT milk into China has
grown strongly in recent years, increasing
four-fold in the last four years. Chinese
production of milk has failed to keep up
with the rapidly growing demand in China,
which is generating opportunities for
producers of high-quality dairy exports.
The product itself is being produced
in a new, state-of-the-art factory in
Co. Monaghan, which was developed
with the support of Enterprise Ireland.
Speaking at the launch, Siobhán Talbot,
Glanbia Group managing director said:
“At Glanbia we pride ourselves on our
full traceability from grass to glass. By
partnering with Milkmore, Glanbia can
also guarantee Chinese customers and
consumers full traceability from farms in
Ireland directly to glasses in China.”
The Irish Dairy Board (IDB) also
announced it was launching a Whole Milk
product under its new Kerrygold Chinese
trade mark, 金凯利, pronounced ‘Jin
Kai Li’. Commenting on its growth in the
market, the IDB said: “There are few more
significant countries than China in terms
of opportunity for dairy growth”. The IDB
also sees the potential to increase its dairy
business in China with cheese and butter.
The IDB has in-market teams in
Beijing, Shanghai and Shenzhen and is
investing in its in-market infrastructure
with plans to double its ‘feet on the
street’ this year. The IDB says it is also
actively looking at acquisitions and
joint ventures in the market.
Furthermore, during last year’s trade
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focus
Sustainability
mission, the IDB signed a
Memorandum of Understanding
with Guangxi Royal Dairy, a Chinese
dairy producer, to explore developing
new products for sale in the Chinese
dairy market. Manufacturing of the
products, the main ingredient of
which will be Irish milk, will be based
in both Ireland and China.
Infant formula
Despite accounting for only 1 per
cent of global dairy production,
Ireland supplies 10 per cent of the
global infant milk formula. This, Bord
Bia (the Irish Food Board) says, is
testament of the quality and safety of
Ireland’s dairy industry, which strongly
emphasises traceability throughout
the food chain. In 2014, Irish exports
of infant formula increased by an
estimated 15 per cent and were valued
at approximately €850 million.
China has been identified as a key
market for Ireland’s infant milk
formula outputs. In fact, Wyeth’s
Illuma infant formula, which is
manufactured in Askeaton, Co
Limerick, is Ireland’s largest single
www.irishfoodmagazine.com
export product to China, with an
estimated value of €180 million.
In 2014, the Kerry Group launched its
Green Love infant formula product in
China. This follows the development
of a strategic partnership between
Kerry Group and Beingmate, a
Chinese dairy company, that will see
infant formula produced in Ireland
retailed in the Chinese market. Green
Love is specially manufactured in
Charleville, Co Cork for sale in the
Chinese market. Edmond Scanlon,
president and CEO, Kerry APAC said:
“We have worked extensively with our
global and Chinese partners to develop
specialised nutritional ingredients
for infant nutrition applications. The
APAC region and China, in particular,
will continue to be key growth markets
for Kerry and the Irish dairy industry.
Ireland with its strong focus on
innovation and nutrition, supported
by a sustainable production model
and strong Irish Government support
will play a key role in supplying the
Chinese market with safe, nutritious
and innovative milk products for
many years to come.”
While Ireland is naturally suited to
grass-based dairy production, there has
been a strategic focus on preserving
the environment that has led to Ireland’s
success within the category.
The commitment of primary producers to
operate in the most sustainable manner
possible is now being tracked by the
Sustainable Dairy Assurance Scheme
(SDAS), a national, independentlyaccredited (European Standard for
Product Certification - ISO 17065: 2012),
sustainability and quality assurance
scheme. The scheme involves on-farm
dairy audits at 18-month intervals,
which incorporate areas such as the
environment, biodiversity and animal
health and welfare.
According to Bord Bia, this is the
first national dairy scheme of its type
anywhere in the world. It is Bord Bia’s
intention to have all dairy farms in
Ireland signed up and participating in
the SDAS by 2016.
To date, some 50 per cent of Irish dairy
farmers have registered for participation
in the scheme. While primary production
is covered by the SDAS scheme, Ireland
is no longer a primary producer in the
dairy category. Significant advancements
in technology and investment by the
industry has seen Ireland emerge as a
leading producer of add-value products.
Therefore, the commitment to
sustainability extends beyond the farm
gate, all the way to the buyers’ door.
With that in mind, Ireland’s leading dairy
producers have signed up to Bord Bia’s
Origin Green sustainability programme.
Independently verified, Origin Green
requires participating processors to
establish clear objectives under three
key areas: raw material sourcing,
manufacturing processes and social
sustainability. Some targets set by these
companies include waste management,
reduced energy and water consumption,
among many others.
Almost three years after its launch, Origin
Green and its verified members are now
able to demonstrate to international
buyers the positive impacts of their
sustainability commitments.
For more on Origin Green see page 34.
Issue 2 2015
29
focus
Understanding
market mores
for growth
Headline Headline
As Clonakilty Blackpudding continues to grow its
export base it is keenly aware of the importance of
cultural
Subheadnuances in its target markets
B
lack and white puddings
are traditional elements
in a full-Irish breakfast.
In more recent years, as
Ireland’s love affair with
food has evolved, the use of black and
white puddings in cooking has evolved
and they are regularly used in a range of
recipes, including fine-dining starters and
canapés. Clonakilty Blackpudding is a
household name in Ireland and it is now
growing its sales base internationally.
The UK
Colette Twomey, managing director of
Clonakilty Blackpudding, says the UK is
one of the brand’s foremost target markets.
Already, the company has secured listings
with a number of the country’s leading
multiples, including: Tesco, Waitrose,
Morrisons, Budgens, Asda and onlineretailer Ocado. Most recently, Clonakilty
Blackpudding agreed a temporary listing
with 43 Sainsbury’s stores across the London
region and will be running a promotional
campaign in April throughout these stores.
To mark the listing, the company began an
online campaign with a prize trip to the
home of its black pudding, Clonakilty.
Colette explains that, while it is Ireland’s
30
Issue 2 2015
biggest export market and closest
neighbour, there are many important
differences that have to be considered when
exporting to the UK.
The company participated in Bord
Bia’s (the Irish Food Board) fellowship
programme where it was mentored by
a former buyer from Sainsbury’s who is
now a consultant with Bord Bia.
“One thing we realised early on is that
people in Ireland know that Clonakilty is a
place and they know about the tradition of
black pudding. That’s a given here in Ireland.
In the UK, we had none of that.”
Firstly, Colette says, it is important to
educate consumers about the product.
“There is a small base market for black
pudding but it is very much more in the
north of England. So, there is huge potential
to develop a market among consumers who
haven’t eaten pudding before.”
The way to do this, she says is tastings. “We
do a lot of food shows and have tastings
at those. We have been doing the Taste of
London for a few years. We do trade and
consumer shows and the reactions are always
good. We don’t advertise by billboard we
advertise by tasting, we cook up the product,
taste it and get a positive reaction. The task is
to get the consumers familiar with the brand
and looking for it in their local shop.”
Branding
Colette says it was important to
reconsider the product’s image for
UK consumers. The company created
new packaging for its product in the
UK to include a cardboard box, which
provides insight to consumers on the
product and producer. “There is some
detail about black pudding and a
measuring guide to tell people how to
cut the pudding and how to cook it. It
also gives a sense of provenance, telling
the story of Clonakilty and the tradition
of black pudding,” says Colette.
International interest
Interest in Clonakilty Blackpudding
is growing internationally, with
sales on the rise in Australia and
the Middle East. The market in the
Middle East came about as a result
of a meeting with Pan Euro Foods
during Marketplace International. The
company started exporting its black
and white pudding products to the
region and is now retailing its sausage
and rasher products too. Colette says
the large expat community in the
region is driving its success in both of
these markets.
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focus
Tapping
into a buoyant
market
In the early 1980s when the water-in-a-bottle concept was floated in
Ireland, many thought it would sink. Water may fall freely and frequently
from the Irish skies, but the bottled variety offers consumers a premium
product that is natural, clean, pure and fresh
I
reland’s buoyant bottled-water
industry has evolved into one
of the most successful sectors
of the soft drinks category in
Ireland. Water sources are located
in majestic mountains, it is naturally
enriched through limestone and sandstone
filters, and fully accredited to the highest
standards.
Bottling this water all started in 1981with
Ballygowan and its founder, Geoff Read.
The product was launched on Ireland’s
longest-running TV chat show, which
featured a special enterprise segment for
new businesses. Famously, the show’s
presenter asked the question: ‘Who would
buy bottled water?’
Such scepticism wasn’t the preferred
reaction but that question has since been
unequivocally answered.
Water babies
According to a Euromonitor report from
April 2014, bottled water volume and value
sales grew in Ireland by 1 per cent each
www.irishfoodmagazine.com
during 2013, reaching 175 million litres and
€244 million. Flavoured bottled water is
the fastest growing category with total value
sales up by 3 per cent in 2013.
Irish people drink approximately 25 litres
of bottled water each year, on average. With
a move towards healthier lifestyles, Irish
people are switching to water and flavoured
water as sources of hydration, over the
traditional carbonated products, and this
is expected to continue. It is estimated that
volume sales will grow by 2 per cent to
the end of 2018, with still, natural mineral
water expected to be the main driver of
this. And it is expected that consumers will
continue to drink bottled water during
physical activities.
The Ballygowan bubble
Today, Ballygowan is one of the leading Irish
water brands, holding a 21 per cent market
share in Ireland, with an approximate 20 per
cent share in grocery, 50 per cent in licensed
trade and 40 per cent in the water cooler
market. Ballygowan is currently owned and
distributed by Britvic Ireland Ltd, a leading
Irish soft drinks company.
Ballygowan’s water is filtered through
mineral-rich limestone in an underground
well that dates back to 1184. This is then
bottled at source in Newcastlewest, Co
Limerick, in southern Ireland.
Ballygowan has invested significantly over
the years to grow its market share.
Initially, its water was available in a glass
bottle, but is now available across a range
of pack formats and sizes from 250ml
kids’ packs up to the 18.9-litre watercooler
bottle. The company has continually
innovated in terms of how it markets
Ballygowan and recent partnerships that
the company says it is very proud of
include the Ballygowan Gold campaign
that raised in excess of €100,000 for the
Irish Cancer Society in 2014.
In 1991, it constructed a purpose-built
52,000sq ft bottling and warehousing plant
and in 2000, significant investment of
€12 million was spent on new lines and
warehouse facilities, creating one of the top
water bottling plants in Europe.
Issue 2 2015
31
In 2014, Britvic Ireland announced the
launch of Ballygowan natural mineral
water into Great Britain (GB). The
product is stocked in the leisure and
workplace channels and in selected
convenience and grocery retail outlets.
It represents a huge milestone for the
company in a market that represents 16.5
per cent of the GB soft drinks market,
equating to a volume of 1.5 billion litres,
and worth €1 billion at retail sales value.
According to Kevin Donnelly, country
director Britvic Ireland, the Ballygowan
brand has been well received by GB
consumers, who love the packaging and the
brand’s unique heritage.
Making a splash at Marketplace
Ballygowan has had a ripple effect in
Ireland, with other bottled water companies
springing up over the years.
Two such companies, Glenpatrick Spring
Water and Celtic Pure, which are both
verified members of Origin Green will be
exhibiting at Marketplace International
2015, the largest trade event for the Irish
food and drink industry.
Glenpatrick Spring Water is located in
Co Tipperary and it has a nutritional
division located in Co Kilkenny, both
in southern Ireland.
Like Ballygowan, Glenpatrick was formed
in the early 1980s, bottling spring and
mineral water drawn from limestone
rocks found beneath the beautiful
Slievenamon mountain in Co Tipperary.
Glenpatrick is a private-label company
only. It predominantly caters for the retail
market in Ireland and the UK and its
products comprise: still, sparkling and
spring water, as well as energy drinks, and
flavoured waters. Its glass-bottled range
caters for an adult market, and comprises:
spritzers and pressés, and premium
dinner-table products.
Its key customers include Marks and
Spencer, which it has dealt with since
the late 1980s, Sainsburys, Aldi and Lidl,
Heineken and Heinz.
In volume terms, Glenpatrick exports
approximately one third of its product,
predominantly to the UK market.
Glenpatrick is a member of Bord Bia’s
(the Irish Food Board) sustainability
programme, Origin Green. Michael
32
Issue 2 2015
says the initiative is important as it
encourages businesses to drive efficiencies,
both environmentally and financially.
Glenpatrick is achieving these efficiencies
by investing in state-of-the-art, highlyefficient plant machinery, being clever
about its water usage (in its processes) and
it has a zero landfill policy.
Ireland’s clean and green reputation is
helpful, according to Michael, but it is
the quality of ingredients used in all its
processes, the investment in top-ofthe-range equipment, that makes them
stand out.
“We use the best of water, the best of
ingredients and we are fully accredited,”
says Michael.
While the Kilkenny nutritional plant does
not produce mineral water, it is an integral
ingredient in its manufacturing process,
which caters for the infant, functional
beverages and food for special medical
purposes sectors.
bottles will be reduced by close to 30 per
cent,” explains Padraig.
This type of investment means there is less
waste and more efficiency, which is in line
with the goals of Origin Green, of which
Celtic Pure is a member.
“Origin Green sets the key numbers and
figures in terms of recycling and waste
disposal,” says Padraig.
“By joining Origin Green, we have a base
to start with and then we set our targets
over the next three to five years. It sharpens
you up in terms of being a better company.
And, for our customers, they know that
they are dealing with a company that looks
after the environment. Celtic Pure has won
numerous awards including the Small Firms
Award 2013 (Best food and drink category),
British Bottling Institute (BBI) 2014 (gold
medal, still), and BBI 2014 (silver medal,
sparkling).
Tapping into Tipperary
Investing for success
Celtic Pure’s managing director Padraig
McEneany is looking forward to exhibiting
at the company’s third Marketplace
International. The event is key in targetting
new opportunities, he says.
Established in 2000, Celtic Pure Ltd is a
family-run business currently employing 40
people. It is also Ireland’s fastest-growing
water-bottling company with growth of 40
per cent in 2014.
While Padraig hopes to target markets in the
UK, northern Europe and North America in
the future, right now the priority is to look
after its existing customers and continue
the success it has achieved in Ireland. Celtic
Pure produces still and sparkling water
only, for the retail and hospitality sectors.
Fifty five per cent of its product is branded,
while 45 per cent is private label. Exports
account for 18 per cent of the business, with
a projected turnover in 2015 of €8 million.
The company defines its innovations as
the investment it makes in equipment and
machinery. It recently invested €2.5 million
in a state-of-the-art bottling line.
“This new technology means we can reduce
the amount of plastic we use by 25 per cent.
“And, because we are increasing line speed
by two-and-a-half times, to 18,000 bottles
per hour, the cost of production per 1,000
Tipperary Natural Mineral Water was
the first Irish bottled water to be awarded
natural mineral status in 1987.
The water is filtered for over 50 years
through the Gapped Mountain of Ely in
Co Tipperary, and sourced at a depth of
300 feet. The source is covered in Devonian
sandstone, which gives it the highest degree
of filtration and protection.
The company caters for an Irish
market currently, but says there
may be opportunities to expand its
footprint in the future.
In response to the growing flavoured
water market, the company has
developed six flavours including
blackberry, raspberry and apple. The
company says its Tipperary sparkling,
flavoured waters are market leaders
within the sparkling flavours segment.
Since its inception, Tipperary Natural
Mineral Water has grown to become one
of the leading Irish waters. Tipperary has
developed a range of pack formats to suit a
range of consumers an occasions, as well as
an award-winning flavoured water range.
Tipperary has won numerous BBI (British
Bottling Institute) awards for its flavoured
range and will continue to innovate in this
field, the company says.
www.irishfoodmagazine.com
A NEW ERA FOR IRISH DAIRY
www.glanbiaingredientsireland.com
industry
Verifying Ireland’s
commitment to sustainability
From the very outset, independent verification has been the cornerstone of Origin Green.
talks
with SGS about its role in Origin Green and verified members tell us what it means to them
I
n today’s consumer landscape,
it is not enough for companies
or brands to make a claim;
they have to prove it. This is
particularly true of the food
industry, where trust and safety are
vital. Consumer research from Bord Bia
(the Irish Food Board) highlights that
consumers are increasingly sceptical
about the claims businesses make and
they are now demanding more evidence
to support these claims. Bord Bia’s
Consumer Lifestyles Trends programme
has identified a trend it describes as
‘Keeping it real’ whereby consumers are
putting brands under greater scrutiny and
now demand comprehensive transparency
from the companies that they buy from.
However, with the rising availability
of product and service information
competing for consumers’ attention,
transparency stories must also engage with
consumers, not just factually inform them.
communicates to consumers that
organisations take standards seriously
and that they are open and transparent.
It also provides proof, he says, that their
behaviour and practices are robust enough
to withstand high levels of scrutiny from
subject experts who operate without fear of
favour, and who always act on behalf of the
consumer’s best interest.
“Independent verification supports
organisations in many ways, not least
by offering a guarantee and validation
that the claims made for products are
genuine, honest, transparent and withstand
examination. Independent verifiers follow
strict protocols to ensure objectivity, are
skilled with technical knowledge and
sophisticated levels of observational and
analytical skills, and operate in a highly
structured and methodical way,” says Chris.
Furthermore, Chris believes that
independent verification can also
substantially raise the quality threshold
in a sector, meeting, and even leading, the
expectations of consumers. This, he says,
can help win customers.
Winning customers
Irish companies participating in Origin
Green are already beginning to see the
benefits of independent verification.
Louth-based rapeseed oil manufacturer,
Derrycamma Farm, recently secured a new
listing with a buyer in the Far East off the
back of its involvement with Origin Green.
“They dealt with us in preference to
any other rapeseed oil producer
Third party verification
Origin Green’s strength in the marketplace
comes from being able to provide solid facts
and figures that prove the commitment of
member companies to acting sustainably.
Supporting that evidence through
independent verification has been a key
element of the programme and, for this,
Bord Bia has teamed up with SGS, a worldleading inspection, verification, testing
and certification company that objectively
reviews participating companies and their
achievements.
“The recipe for success in independent
verification is to ensure that the verifier is
truly objective, has extremely high levels of
integrity and is genuinely passionate about
delivering quality to consumers through
trusted and knowledgeable auditing,”
explains Chris Kirk, CEO of SGS.
Independent verification, Chris adds,
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Issue 2 2015
www.irishfoodmagazine.com
industry
because we were verified members of Origin
Green and it was very important to that
customer,” says Patrick Rooney, director of
Derrycamma Farm Foods. He explains that
sustainability is a box that has to be ticked
in order to supply most of the high-end,
premium retailers, such as Sainsbury’s and
Marks and Spencer.
Patrick says there is a lot more to Origin
Green than ticking boxes. “It proved to
be much more in-depth and the plan we
developed needed to be very relevant and
realistic for us.”
Some initiatives Derrycamma has adopted
include: a reduction in the use of fertilisers,
in some instances by 50 per cent; a change
in tilling practices that now sees just the top
two inches of soil tilled; and improvements
in farm biodiversity.
As a verified member of Origin Green,
Patrick knows he must be accountable
for his promises under the Origin Green
Charter and keeps track of work in this area.
“It is always in the back of your head that
you are going to have this audit so you try to
push things on. We need to show progress,
so we need to be achieving our targets.”
www.irishfoodmagazine.com
Big undertaking
Jennifer Mulcahy, quality control manager,
Ballymaloe Foods, says independent
verification is vital for the success of Origin
Green, which depends on the commitment
of an entire industry. “We are relying on
all members to adhere to the ethos of the
programme. Therefore, the members have a
big responsibility.”
Jennifer adds: “The verification programme
has provided structure on the sustainability
measures we at Ballymaloe Foods have already
undertaken. It has given us targets whereas,
previous to this, while we were actively
practising sustainability measures we were not
formally recording or measuring these.”
As part of its commitment to Origin Green,
Ballymaloe Foods actively sources ingredients
from ethical and sustainable sources,
regularly visiting suppliers’ production sites
as part of its own auditing process.
Ballymaloe Foods has set targets for its next
phase of growth, which will see production
capacity grow by 10 per cent per annum.
Jennifer notes: “Origin Green represents a
timely opportunity to focus on actions in
four key areas: sourcing from suppliers with
recognised certification; waste management;
water management; and the company’s role
in the local community.”
Jennifer explains that the company’s
participation in Origin Green has helped in
acquiring new business, with a new listing
secured for its Ballymaloe Original Relish
in Tesco UK. “Having our Origin Green
sustainability plan in place was significant
in securing this agreement as Tesco UK is
proactive in sourcing sustainable products
from sustainable companies. We also had a
visit from a Dutch buyer this year who was
extremely impressed with Origin Green and
felt it could utilise this going forward with
Ballymaloe Foods.”
Market differentiator
Origin Green is not a one-size-fits-all
programme. Each company sets out targets
that are relevant to its business. These
targets are continuously evolving, as Kevin
Cahill at Kepak explains. “We have just
signed off on an updated version of the
plan at the beginning of the year. That is all
part of the process. We have achieved initial
targets and we have refreshed and added
new targets in some areas of the business.”
The meat processor has set a number of
targets in a range of areas, which include:
energy use, carbon emissions, waste to
landfill, and water consumption. Kevin says
these are all very measurable targets and,
over the life of the plan, the company will be
looking for improvements between 4-10 per
cent in these categories.
Kepak also addresses sustainable sourcing
by working with its suppliers. “We have
a couple of programmes on sustainable
farming practices that encourage farmers to
effectively look at their business to improve
profitability and sustainability.”
Kevin says the Origin Green programme is a
great motivational tool within the business.
Independent verification, he says, provides
a level of validity to the programme that
is a support to companies when they are
communicating their commitment to
Origin Green with international buyers.
As an export-orientated country, Kevin
says Origin Green is a key differentiator for
‘brand Ireland’ internationally. “While there
is a lot of focus on sustainability in the big
brand houses, like Unilever and Procter
and Gamble, there is no one country that
has done it in the way that Bord Bia has
accomplished for Ireland,” Kevin concludes.
Issue 2 2015
35
industry
Driving expansion
in agri-food exports Enterprise Ireland partners with entrepreneurs, Irish businesses, third
level institutions and investment communities to develop Ireland’s
international trade, innovation, leadership and competitiveness
T
he Government agency has
long recognised that the
performance of Ireland’s
food and drink industry
will be a key economic
driver of Ireland’s continued recovery.
In 2014, the industry generated €25
billion in turnover and accounted for
approximately 170,000 jobs. Importantly,
that employment has an extensive
geographical spread throughout all
regions of the country with higher-thannormal concentrations in rural areas.
“Enterprise Ireland works closely with
food and beverage clients to support them
in the areas of expansion, innovation,
competitiveness, leadership and raising
finance so that they can become successful
global players,” says Jennifer Melia,
Enterprise Ireland.
Between 2013 and 2014, Enterprise Ireland
approved investments of more than €100
million for food and beverage companies,
leveraging over €1 billion in total
investment.
Be innovative, be different
Innovation is critical for Ireland’s food
industry to gain a competitive edge and
win in world markets. Reflecting this, the
Government’s Food Harvest 2020 strategy
sets a target of doubling research and
36
Issue 2 2015
development (R&D) expenditure by 2020.
“We encourage and supports companies to
focus on innovation as a differentiator. We
support companies of all sizes to engage in
innovation, from initial proof-of-concept
investigations to large in-house projects,”
Jennifer notes.
Enterprise Ireland supported Ireland’s
largest single food innovation investment
with the establishment of Kerry Foods
Global Food Innovation Centre of
Excellence in Naas, which will create 800
new jobs, as well as 400 construction
jobs, and will be one of the world’s most
advanced food innovation facilities.
Seeds of opportunity
Enterprise Ireland, Jennifer explains,
engages with companies to help them
move up the value chain, focus on
higher-margin products and ensure they
have the systems in place to compete
internationally. “Constant innovation will
help our companies remain ahead of their
competitors and strengthen their foothold
in the market, both in Ireland and globally.”
Family-run Food Nutrition & Innovations
Ltd, which produces the health-food
brand Good4U, is succeeding in this area.
Combined funding of Ä1 million, from the
Western Development Fund, Enterprise
Ireland, AIB and internal investment from
the company, facilitated the opening of
new R&D and production headquarters in
Sligo. Bernie Butler, Managing Director at
Good4U, says the investment was vital to
support the restructuring of the business
and to ensure the facility met all of the
necessary requirements. It is also well
positioned to handle increased capacity
for continued growth. With strong sales
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industry
in the UK, the company has also secured
new listings in the United Arab Emirates
and France. It is launching a new range of
products this April, which was developed
at its site in Sligo. Innovation, Bernie
says, is innate to every aspect of the
business, including it products, people and
technology. “No food business will survive
without it. It has to be part of the culture
and business identity.”
Bernie adds that investment in product
development is key to continued success.
“Our investment in product development is
where we win. We have chosen the healthfood sector to work in because it is most
aligned with us as a family. We can stand
over our products and bring healthy eating
to consumers by making it tasty, bringing it
to people in a differentiated way.”
Expanding internationally
Opportunities for growth in international
markets are significant and many Irish
companies are successfully building their
presence in export markets, becoming
world leaders in their field. Cooked-meat
producer Ribworld has experienced strong
growth internationally over the past three
years, spreading its wings as near as France
and as far away as Qatar and Ghana.
“This has been driven, with the support of
Enterprise Ireland, through innovation and
market research,” says Paul Walshe, Sales
and Marketing Director of Callan Bacon.
Ribworld, part of Irish-owned Callan
Bacon, is considered one of the leading
brands in Europe. Paul says this is testament
to its quality and great taste.
“Ribworld is now at the leading edge of
product innovation, which is helping us
gain interest from a wide range of new
and potential customers both near and far.
Innovation is all about finding new ways to
improve the consumer experience and bring
new consumers to our growing category.
Our innovation team is constantly striving
to be part of the next trend.”
Its products have won both Great Taste and
Blas na hÉireann awards and it recently
launched new products.
Through the successful launch of an
NPD project run through an Enterprise
Ireland Product Innovation scheme,
one of the company’s brands also
achieved a listing in one of the UK’s big
four. Enterprise Ireland also assisted
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Ribworld in its move into a 95,000sq ft
plant to facilitate its continued growth.
Paul added: “Callan has had steady growth
over the past five years, doubling in size.
This was driven by plant investment,
machine improvement and total
implementation of lean activities across the
company. None of this would have been
possible without the support and guidance
of Enterprise Ireland.”
Industry-led research
As well as supporting businesses, Enterprise
Ireland has a strong focus on industry-led
research and commercialising investments
in third-level research institutions. “One
of the most significant recent examples
involved the investment of Ä20 million in
Food for Health Ireland Technology Centre
(FHI),” explains Jennifer. This initiative is
a key infrastructure to support the dairy
industry in Ireland. More recently a new
Dairy Processing Technology Centre was
launched. “These investments underpin
Ireland’s world-wide reputation in food
innovation and secure our standing as an
innovative and competitive world leader in
the food industry,” concludes Jennifer.
New and innovative entrants
A challenge for Enterprise Ireland is
to find companies that have both the
potential and ambition to grow their
business. Both 2013 and 2014 were very
productive with more than 15 High
Potential Start-Ups (HPSUs) receiving
investment from Enterprise Ireland.
Spice O’ Life was one such HPSU, which
today employs 31 people. Tom Kearney,
Managing Director, Spice O’ Life, says the
support of Enterprise Ireland was critical
to its current success and the company’s
ability to build scale. He says NPD is
central to the company’s activities. “NPD
is a crucial service for our industrial
customers who would be, for example, a
factory that wouldn’t have the expertise
that we have, nor would they have the
NPD facilities. They see us as an extension
of their business. Our ethos is: ‘Consider
us your new product development
facility’. They come to us with briefs and
we develop the product for them for free
on the basis that when the product goes
to market they buy the necessary spice
blends or liquid marinades they need to
make that product from us.”
Spice O’ Life also produces its own Spice O’
Life, which it began retailing in butchers.
“That’s our lead-in business. The customer
gets with it and our service then grows
quite dramatically.” Presto is the company’s
foodservice brand and Insanely Good is the
company’s main retail/consumer brand.
Continuous improvement
Continued improvement in competitiveness
is essential to growing exports. Enterprise
Ireland has been at the forefront of the
drive for competitiveness in the food
industry through the provision of tailored,
Lean support mechanisms.
In 2009, Green Isle Foods, a major
exporter in the Irish frozen consumer
food sector, participated in Enterprise
Ireland’s Lean programme. At the time,
sterling had weakened by 30 per cent
against the euro, creating challenges for
Irish food manufacturers competing
with UK processors for UK retail shelves
and foodservice. Enterprise Ireland’s
lean business project, which Green Isle
implemented, achieved cost-savings across
the total value chain, increasing efficiency
and re-establishing competitiveness.
“This Lean initiative, and the support
we received from Enterprise Ireland in
implementing it, was critical in addressing
the high manufacturing cost disadvantages
that had accumulated during the boom
years in Ireland,” says Richard O’Connell,
Financial Controller Frozen Division, 2
Sisters Food Group, which is Green Isle’s
parent company.
More recently, Enterprise Ireland
supported R&D projects to innovate
solutions and develop new lines of pizza
and pastry products with innovative recipe
solutions for grab and go formats. These
R&D projects are also seeking to provide
innovative solutions in areas such as:
product stability and durability; physical
composition, new flavour profiles and the
development of innovative packaging.
Richard concluded: “Like most other
sectors today innovation in both product
and process are a key plank for future
growth for the business and the support
we receive from Enterprise Ireland allows
us to further develop our capability and
expertise in this area.”
Issue 2 2015
37
industry
€35m investment
in Irish dairy
processing research
Irish Government announces a €35 million investment in Ireland’s dairy
processing industry ahead of the abolition of EU milk quotas
T
he Irish dairy processing
sector continues to ramp
up its preparations for the
end of milk quotas with
the announcement of an
innovation investment of €35 million.
This will be spent in the form of two
initiatives: €25 million will be spent on
a Dairy Processing Technology Centre
(DPTC) supported by the Department of
Jobs through Enterprise Ireland and dairy
industry partners, which will be hosted
38
Issue 2 2015
by the University of Limerick; meanwhile,
€10 million will be invested by Teagasc
and dairy industry shareholders into the
expansion of the Moorepark Technology
Ltd (MTL) pilot plant facility in Fermoy
Co Cork.
The Government says the investment will
position Ireland as a world leader in dairy
innovation, and will help maximise the
long-term growth opportunities created by
an anticipated increase of 50 per cent in the
Irish milk pool by 2020.
Industry investment
Ten of Ireland’s leading dairy companies
are involved in the overall investment,
with seven (Arrabawn Co-op; Aurivo;
Carbery; Dairygold; Glanbia; the Kerry
Group, and Tipperary Co-Op) investing
in both initiatives. Meanwhile, Lakeland
Dairies is part of the DPTC consortium
only and the Irish Dairy Board (IDB) and
North Cork Co-op are investing in MTL.
University of Limerick will lead nine
other research performing organisations
www.irishfoodmagazine.com
industry
Pictured at a €35 million investment announcement to make the Irish dairy
processing sector more innovative, were: Alan Kelly, Minister of Environment,
Community ans Local Government; Richard Bruton, Minister for Jobs, Enterprise and
Innovation; and, Simon Coveney, Minister for Agriculture, Food and the Marine.
(RPOs) in the DPTC to deliver the
research and technology required.
Announcing the investment of €10 million
by Teagasc and industry shareholders to
expand and modernise the MTL pilot
plant facility, Minister Coveney said:
“This is a perfect example of what can be
achieved when clear and common policy
objectives are supported by coherent action
by Government agencies in partnership
with industry. Investing in product and
process innovation makes sense for a host
of reasons. It ensures that value is added to
high-quality raw materials in Ireland and
maximises the contribution of the dairy
sector to employment creation and the
Irish economy generally. It also contributes
to improved competitiveness, and helps to
mitigate the impact of commodity price
volatility on operators along the supply
chain, including farmers.”
The Minister added that this kind of
investment can build the industry’s
reputation for excellence in all things
dairy that will create a platform, not only
for export growth, but also for inward
investment by major global players in the
food industry. “This is exactly the kind of
initiative envisaged in Food Harvest 2020
and I am delighted to be associated with it.”
Dairy Processing
Technology Centre
The DPTC is the latest of 15 technology
centres, funded by the Department of
Jobs, Enterprise and Innovation through
Enterprise Ireland, which have been
introduced to support market-focused,
applied research, development and
innovation.
www.irishfoodmagazine.com
The DPTC consortium involves eight
companies: Arrabawn Co-op, Aurivo,
Carbery, Dairygold, Glanbia, Kerry,
Lakeland Dairies and Tipperary Co-Op and
nine research-providing organisations.
The recently appointed CEO of the DPTC,
Padraig McPhillips explained that the
DPTC is a collaborative model in which
the best research talent in Ireland, relevant
to industry needs, is brought together with
the dairy sector to solve strategic research
and innovation needs articulated by the
sector. “The two key outputs of the DPTC
will be knowledge and people – both will be
absorbed by the industry and used to deliver
more efficient processes and better products
and ingredients. The DPTC is like adding
a new software engine to the dairy sector,”
Padraig explains.
The aim of the Technology Centre
programme which is managed jointly by
Enterprise Ireland and IDA Ireland is to
achieve competitive advantage for industry
in Ireland by accessing the innovative
capacity of the Irish research community.
Commenting on the launch of the DPTC,
Dan MacSweeney, chief executive of
Carbery Group and chairman of the Irish
Dairy Industries Association said: “The
Dairy Processing Technology Centre
will be a critical agent in realising the
opportunity presented by the abolition of
the milk quotas by providing a dedicated
public-private partnership investment in a
world-class dairy processing research and
capability centre. The Irish dairy industry
recognises the importance of investing
in sophisticated, collaborative research
and innovation and this is reflected by
the involvement of eight of our primary
processors. Cumulatively, the companies
that are partners in the DPTC process 85
per cent of Ireland’s milk pool, produce
€2.5 billion of Ireland’s annual dairy
exports and provide over 25,000 direct
and indirect jobs. It is also reflected in
the significant industry contribution
of €9 million to the total cost of the
initiative – we are serious about making
this technology centre work for the Irish
dairy industry. We also welcome the
complementary investment in MTL, almost
€4 million of which is being provided by
industry.”
Progressive platform
MTL is an existing subsidiary company of
Teagasc that provides dairy processing pilot
plant facilities to industry for new product
development and scale up. It is 51 per cent
owned by Teagasc and 49 per cent owned
by industry. It is a hardware infrastructure
facility with dairy and food processing pilot
plant kit and facilities. The MTL expansion
is investing in kit and equipment (stainless
steel/hardware). Industry can access the
pilot plant on commercial rates to test new
products and processes within the limits of
the infrastructure available.
The two investments announced are
described by participants as complementary
initiatives; with the upgraded and expanded
MTL pilot plant facility providing the
right environment for some of the new
technology outputs, generated in the
DPTC, to be tested at a commercial scale.
The companies will need to trial the
technologies at a pilot scale to test their
potential robustness on a commercial scale
and the MTL will help the transfer of these
innovations to industry.
Gerry Boyle, Director of Teagasc believes
the €10 million investment will futureproof MTL and ensure its relevance to all
its customers, national and international in
the years ahead. “MTL now lists, among its
customers, the most progressive companies
in the food, food ingredients and
nutritional sectors and it is obliged to meet
the high expectation of these companies in
all aspects of its services.”
Furthermore, he said, the investment
will provide a platform to support the
ambitions of the Irish dairy industry to
produce value-added foods and ingredients
for international markets.
Issue 2 2015
39
industry
Strategies for global growth
Grant Thornton says careful planning is needed
to successfully manage global growth
I
n its Expanding Horizons report,
Grant Thornton highlighted
research from global management
consulting and market-research
firm Lucintel, that predicts the
international food and beverage industry
will reach a value of US$5,776 billion
by 2017. Over the past century, the
international trade of food and
beverages has evolved from traditional,
farm-to-table distribution to shipping
massive amounts of goods around the
globe. Advances in communications
and logistics now mean a vast array of
food and drink options are available to
consumers from all corners of the world.
This presents a great opportunity for
Ireland’s indigenous and multinational
export-focused, agri-food industry to share
in that wealth by strategically growing their
presence in international markets.
Going global
When you see the opportunity to expand
your business in a country where you
currently don’t do business, you might not
know all the ins and outs of how to reach
your goals, says Ciara Jackson, head of food
and beverage, Grant Thornton. “In order
to be effective and profitable, organisations
must balance a range of competing factors
when structuring global operations. Support
from the right people is essential, people
with the information and expertise that will
allow you to optimise your decisions and
reach your goals with confidence.”
Grant Thornton’s global market entry
services team helps companies establish
or expand their global operations,
optimise their tax position, and mitigate
funding and liquidity risks.
“We take a holistic approach to assist
companies in making informed decisions
when developing a global operating
strategy. The global market entry team can
help companies understand and analyse
multiple operating scenarios and consider
the range of influencing factors, criteria,
40
Issue 2 2015
business priorities and constraints.
“Clients such as Walsh’s Bakehouse, which
produces Waterford Blaa, Sheridans Cheese
and Good Food Ireland are carving out new
opportunities to scale in exciting growth
markets for proven products and brands,
following in the footsteps of global Irish
players such as Kerry Group plc, Keelings and
the Irish Dairy Board,” says Ciara.
Innovation and adaptation
According to Ciara, companies that
successfully capitalise on international
opportunities are innovative and adaptable
to market requirements, whether it’s
changes in processes, products or strategies.
Developing a market access plan
is vital to success, adds Ciara. This
will identify local market dynamics,
competitors and distribution
channels, as well as the most
profitable product opportunities. It
also helps identify potential pitfalls,
which companies can prepare for.
Comprehensive planning will also take
into account specific market regulations
including inspection standards, labelling
and product claims, traceability processes,
and recall procedures.
“The increasingly competitive
marketplace accentuates the
need to develop key points
of differentiation in order to
maintain and develop market
share. Investment in R&D to
ensure high-value products are
sold at the premium-end of
international markets will result
in high margins for producers and
protect against competitors.”
Furthermore, an important factor
for consideration is the protection of
intellectual property in each market. “In
food, it is not just product innovation that
is important but also process innovation
and the provenance embedded in the
brand. Protecting and leveraging this
intellectual capital is a key driver of success
and understanding their dynamics in a new
market is a critical point of differentiation
and success.”
Optimal business model
Not all markets are identical. Therefore,
Grant Thornton advises clients to
investigate the optimal business
structures that can be used in the target
market. This may include models such as
joint ventures, acquisitions, distribution
into the region, business alliances and
transactions through third parties.
“When a business decides to move
into a new market it must give it the
same attention and commitment as its
home market – establishing the right
infrastructure to support its long-term
presence in the market. Building new routes
to market takes time, energy, talent and
money. A new product, in a new
market, with a new corporate
structure led by new people
brings significant risk. The
chances of success can be
improved by reducing the
number of ‘news’. Our job
is to help in that process so
transition from new market
entry to market maturity is
navigated successfully.”
www.irishfoodmagazine.com
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FOOD
SERVICE
industry
Brian Mehigan, CFO and
Stan McCarthy, CEO,
Kerry Group.
Kerry Group trading
profits up 4.1%
Despite a challenging market environment, Kerry
Group saw a €25 million increase in profits in 2014
T
he Group recently
announced a 4.1 per
cent margin increase in
trading profit to €636
million for the year
ending December 31, 2014.
With overall volumes increasing by 2. 4 per
cent, Group revenue stood at €5.8 billion,
despite a decline in sales of 1.4 per cent.
Commenting on the results, Kerry Group
CEO Stan McCarthy said: “We recorded
another year of good growth, business
margin expansion and an 8.1 per cent
increase in adjusted earnings per share
in 2014. The consumer environment
across developed and developing markets
is changing rapidly but Kerry is well
positioned to capitalise on global growth
opportunities. We expect to achieve
another year of good growth in 2015.”
Ingredients and flavours
Despite weaker overall market
conditions and lower industry
inventory levels, Kerry’s ingredients
and flavours businesses achieved good
volume growth and a strong trading
performance. Sales revenue was €4,337
million, reflecting continuing business
volume increases of 3.4 per cent, while
net pricing declined by 0.5 per cent.
There was solid growth in all regions
for Kerry’s beverage systems and
flavours, according to Stan, while its
nutritional category put in a strong
performance in Asia.
42
Issue 2 2015
Consumer foods
Kerry’s consumer foods division saw
revenues of €1,509 million, a 5.8 per cent
decrease on 2013 figures. This, the Group
said, was due to difficult market conditions
in the Irish and UK consumer foods
markets, due to increased fragmentation,
polarisation and intense competitiveness
in the retail grocery sector coupled with
continued restrained consumer spending.
Kerry’s UK brand put in a solid
performance during the year, with
growth in its snack offering. In Europe,
its Cheestrings brand also saw growth,
particularly in Poland and Austria.
Markets
The European, Middle East and Africa
(EMEA) region accounted for the largest
revenue stream (53 per cent), followed
by the Americas (33 per cent) and AsiaPacific (14 per cent).
Asia-Pacific developing markets provided
excellent growth opportunities in 2014
where Kerry outperformed food and
beverage market growth rates – benefittng
from the increased Group resources
deployed to market development in the
region. Reported Group revenues in the
region grew to €807 million, reflecting 11.8
per cent growth in continuing volumes and
0.3 per cent lower pricing.
Economic growth in North America was
positive in 2014 but lower than expected.
Increased raw material and food price
inflation limited growth opportunities for food
and beverage manufacturers. Despite the overall
weaker industry environment, Kerry performed
well in the Americas in 2014 – in particular
through clean-label, all-natural and health and
wellness solutions. Revenue in the American region
at, €1,901 million, reflects 3.3 per cent continuing
volume growth and 0.4 per cent lower pricing.
Overall, EMEA market conditions remained
challenging with limited growth opportunities.
However, Kerry continued to record good
development progress and greater business
efficiencies. Revenues in the EMEA region,
reported at €1,549 million, reflect a 0.5 per cent
reduction in continuing volumes and 0.8 per
cent in lower pricing. A focus on realignment
of business structures and customer service
capabilities ahead of the transition to the new
Kerry Global Technology & Innovation Centre in
Ireland was significantly advanced, according to
the Group.
Looking forward
Speaking about the year ahead, Stan said the
Group is well positioned for continued growth.
Capital resources will be invested in continued
organic development of the Group’s growth
platforms and in complementary acquisition
investments.
Investment, according to Stan, is central to the
Group’s strategy for growth in both platforms.
He added that today’s consumers are more
demanding in terms of choice, looking for better
food experiences and trusted ingredients. He said
the Kerry Group is repositioning to meet those
changing consumer and channel demands.
www.irishfoodmagazine.com
Innovation Partner for the
Agriculture and Food Sector
Teagasc researchers partner with the industry to drive innovation in the agriculture and food sector. The Teagasc
advisory network assists farmers to combine environmentally sensitive technical innovation with prudent business
management, and Teagasc education courses equip future farmers to become lifelong innovators.
Sustainable Agriculture
Reducing Greenhouse Gas Emissions
Maintaining Clean Water
Grass based Livestock Systems
New Technologies
Breeding New Potato Varieties
Satellite Mapping for Precision Farming
Sexing semen for Animal Breeding
Technology for the Food Sector
High Quality Gluten Free Breads
Phage Therapy for Controlling MRSA
New Product Development
www.teagasc.ie
trends
The ‘white
gold rush’
Competition is fierce in China’s infant milk formula
(IMF) market. Therefore, understanding what motivates
consumers is key. Bord Bia (the Irish Food Board)
recently explored consumer sentiment in China to
understand the opportunities for Irish IMF exports.
C
hina is the world’s largest
dairy buyer, and is currently
the second largest consumer
market, after the US, for
infant formula milk powder.
Meanwhile, Ireland is a major exporter of dairy
products, with plans in the pipeline to double
dairy outputs by 2020, following the end of EUwide quotas this year. Ireland has particular
expertise in the area of value-added dairy
outputs, such as infant milk formula (IMF),
which will be a key area of growth following
the end of quotas. With strong demand for
IMF products in the Chinese market, Bord Bia
carried out ethnographic consumer research to
better understand consumers in the market and
to develop consistent communication within
the category.
Getting the basics
Consumer feedback shows that there is a
preference for children to be breastfed. However,
this is not always possible, with both parents
working in many of the families interviewed. In
some cases, mums combine breastfeeding with
IMF feeding. When IMF is the main source of
nutrition for a baby, parents want a formula that
replicates the nutritional benefits of breast milk.
At a basic level, weight gain is viewed as the
most important sign of development in the
early life of the infant. Bord Bia found that
parents in China paid particular attention to
the efficacy of an IMF brand’s ability to help
a child gain weight. Local clinics, which play a
big role in monitoring a baby’s weight, can be
influential in recommending changes to a diet
that will help with weight gain.
Another concern for parents is how well a child
is ‘absorbing’ or digesting IMF. Parents pay close
attention to a baby’s bowel movements to gauge
how well they are absorbing IMF. If a baby is
constipated, this can be considered a sign that
they may not be absorbing their milk sufficiently.
Furthermore, consumers pay particular
attention to the functional benefits offered
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Issue 2 2015
www.irishfoodmagazine.com
trends
by IMF products, which come in a variety
of forms, from preventative to reparative.
However, Bord Bia’s research found
that while there can be confusion about
specific ‘ingredients’ in foods, there is little
confusion about the ‘benefits’ parents want.
Consumers place a lot of importance on gut
health, which is believed to contribute to
the prevention of a range of health-related
issues affecting the child’s immune system
and their digestive abilities. Many IMF
brands are aware of this and include these
functional benefits as standard now.
Many consumers value the role of probiotics
and, specifically, biobifidus as a supplement
to their child’s diet and gut health and have
a solid understanding of what probiotics are
and how they can benefit children.
Bone health is another area of concern.
Calcium, which is very strongly associated
with milk and indeed IMF, is viewed as
the essential ingredient to help with bone
health. More informed consumers talk
about the role of protein in bone health
and some IMF brands highlight the
combination of protein and calcium for
better bone development. However, Bord
Bia says this message really only resontates
with more knowledgable consumers.
Consumers consider calcium as the
‘magic bullet’ for bone development,
with many giving supplements to their
babies, in addition to the calcium that is
built into IMF products.
Brain health is the final and, arguably,
most in-demand functional requirement
that consumers want to build into their
child’s diet. Again, supplements can play
a role here with consumers talking about
buying Omega 3 and fish oil tablets to
help with brain development.
Aside from supplements, consumers
talk about buying IMF brands that
have alpha hydroxy acids (AHA) and
docosahexaenoic acids (DHA) added to the
mix. These functional ingredients are widely
recognised as contributing to healthy brain
development.
Importance of imports
The IMF category in China is complex and,
at times, controversial. A series of food
scares from local producers has meant
consumers are prepared to pay a premium
for imported brands, which dominate the
high-end milk powder market.
www.irishfoodmagazine.com
aspirational brand in China.
Consumers believe Illuma is the best
quality brand on the market, a brand that
is technically advanced and coming from a
pure European source. The precise source of
the brand is not known to consumers, but
once they learn of the brand’s Irish origin it
is viewed as a positive. Ireland’s pure, clean
environment is believed to fit in with the
overall image of Illuma.
Made for China
Mothers in China receiving advice
from in-store exports.
According to Bord Bia’s research, the total
share of the top five foreign milk powder
brands nearly reached 60 per cent in China
in 2012. Furthermore, in the first-tier cities,
foreign milk powder has ranked in the
leading position since 2004, with a market
share of more than 90 per cent.
The imported IMF category is increasingly
busy and cluttered, and Bord Bia says
demand for imported infant milk formula
in China shows no signs of slowing. In fact,
it is predicted to grow further in coming
years, which presents an opportunity for
Irish exports.
Country of origin
Country of origin is an important
dimension of the market for most purchases
of premium IMF in China. Some countries
are longer established on the market than
others and have worked hard to cultivate
their image in the category.
Bord Bia’s research asked Chinese
consumers to rate IMF products based
on their country of origin. Clear groups
emerged based on country of origin
and were ranked in terms of perceived
‘premium-ness’.
IMF products from the Netherlands
and New Zealand ranked at the top of
the map with consumers. However, one
brand stands apart from others: Illuma.
Illuma is a relatively new brand but
it has firmly established itself as an
When it comes to imported brands,
consumers are particularly interested in the
provenance of the brand. Is it a brand that
is available overseas or it is a brand that is
‘made for China’? The preference, Bord
Bia found, is for brands that are available
overseas. But ‘made for China’ is not a
complete turn-off and some consumers
believe that IMF from overseas may not
necessarily suit the ‘constitution’ of Chinese
babies.
Informed decisions
Whatever the source, Chinese consumers
will investigate products, seeking ‘expert’
advice and advice from online parenting
forums. We Chat is one of the first ports
of call for mums looking for advice on
brands and purchasing. The app has
various groups of mums who offer advice
and recommendations not just on IMF
brands but also on general diet, nutrition
and child rearing issues. Local hospital
doctors are also active within certain We
Chat groups.
Advice is also available in-store. Specialist
mother-and-baby stores are common in
most neighborhoods and are regularly
visited by consumers with higher disposable
income. They are an important channel for
imported IMF and usually the most likely
source for premium or niche brands that are
not stocked in the major retailers.
In mainstream retailers, store sales
representatives are a valuable source of
information and referral for consumers
who rely upon sales staff to educate them
about new brands.
Brand reputation and positive word-ofmouth reviews are an absolute must for
any brand seeking to establish itself in the
Chinese market. Advocacy of friends will
almost always drive brand choice.
Issue 2 2015
45
spotlight on...
Frank Walsh, Enterprise Equity Venture
Capital; Veronica Kenneally, Veronica’s Snacks;
and Brian Clune, Boole Investment Syndicate.
Veronica’s Snacks
Healthy snack manufacturer, Veronica’s Snacks, has received a significant
cash injection to help the company expand into new markets
V
eronica Kenneally
founded Veronica’s
Snacks in 2012 to produce
an alternative range
of snack options to
traditional crisps. The inspiration for the
venture came from Veronica’s home life.
With young children, Veronica wanted to
keep her children’s diets healthy, without
denying them the opportunity for treats.
Not compromising on taste
Veronica believes that healthy snacking
shouldn’t compromise on taste and she has
developed a range of gluten-free products,
that have 60 per cent less fat than traditional
crisps. “Crisps today are different to the
crisps we ate years ago. One bag of crisps is
about 40 per cent of your daily fat intake,”
says Veronica. Veronica’s Snacks also
produces a range of corn-puff snacks called
Crunchy Creatures. The gluten-free, lowfat, baked crisps are shaped like dinosaurs
to appeal to younger consumers. Like the
46
Issue 2 2015
original Veronica’s Snacks, these too contain
60 per cent less fat than traditional crisp
options, according to Veronica.
Investment
This spring, the company, which is
headquartered in Cork, secured equity
investment worth €465,000 from Enterprise
Ireland, AIB Seed Capital, a local investment
syndicate, Boole, and chartered accountant
Brian McGann. The new funding will be
used for expansion into new markets as well
as continuing product development.
Currently, Veronica’s Snacks is listed with
leading retailers in Ireland and its products
have been on sale in the UK since summer
2014. Veronica says the company has just
enjoyed a bumper month in the UK, with
record sales in the market. The investment
announced this year will support continued
expansion in the UK.
Veronica describes the UK as a nation of
snackers and, with a population of over 64
million, the market holds great potential
for a product such as this. However,
competition in the category is fierce,
according to Veronica, and it is dominated
by traditional, household names. To
compete, she says, there has to be a
compelling reason for consumers to pick
up the products.
Veronica says there is a growing interest
among consumers in healthy eating
and snacking, which she plans to take
advantage of. Furthermore, an important
factor is that Veronica’s Snacks compete on
price. Veronica explains that, despite the
company’s position in the healthy and freefrom category, it is cost competitive with
traditional snack options. This, she says is
important for continued success.
IFE
Veronica’s Snacks will be attending this
year’s IFE, the UK’s largest food and
drink event, to meet with potential
buyers. Held in March, Veronica will be
using this as a platform to promote its
full range of products and to extend its
reach in the UK market.
www.irishfoodmagazine.com
Ashbourne Meat Processors supply premium chilled and
frozen beef products to leading retailers, manufacturers
and distributors throughout Europe, Russia, Asia, Africa
and the Middle East.
Ashbourne Meat Processors
Naas Industrial Estate, Naas, Co. Kildare, Ireland.
Tel: +353 45 875 400 Fax: +353 45 897 755 Email: [email protected]
Sales Contacts:
Peter McMahon
Mobile: +353 87 245 3500
Email: [email protected]
www.ashmeats.ie
Leslie Kelly
Mobile: +353 87 279 2260
Email: [email protected]
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