7/10/2014: Subsidies Rained on Irish Agriculture: 2013

Recently, CSO published accounts for Irish Agricultural sector for 2013. And what a reading these make.

"In 2013, net subsidies accounted for 66.8% of agricultural income (operating surplus) at state level." In other words, say 'thanks EU' for paying 2/3rds of our farmers' income (or whatever you might call it)...

"In the Border, Midland and Western region, net subsidies accounted for 108.8% of agricultural income, while in the Southern and Eastern region net subsidies accounted for 51.0% of agricultural income." Net subsidies accounted for 176.7% of operating surplus in the Midlands.

A table breaking down the above:

Net Subsidies fell from EUR1.801 billion (73.6% of income) in 2011 to EUR1.63 billion (73.4% of income) in 2012 to EUR1.505 billion (68.8% of income) in 2013. So over 2011-2013, net subsidies shrunk by 16.4%. Meanwhile, operating surplus (income) fell from EUR2.447 billion in 2011 to EUR2.221 billion in 2012 before rising slightly to EUR2.254 billion in 2013 - a net loss over 2 years of 7.9%.

Chart to illustrate net subsidies share of income:

Good thing we have EU taxpayers to sustain these levels of productivity in our indigenous champions of traditional life...

3/2/2014: Good Plans = Good News: Irish Whiskey

Those of you who have been reading my work over the years know that I am big supporter of independent craft whiskey distillers in Ireland and been arguing in favour of policy supports to strengthen indigenous sector here.

So it is good to see some serious growth in the sector here. The latest numbers, provided by the Irish Spirits Association are below:

While still trailing behind Scotch, we are starting to gain some ground. The key here is, however, the number of distilleries. At only 4, Irish whiskey sector remains firmly captured by big, commoditised, lower-quality price-competition focused producers. The sector is still lacking innovation and competition.

The positive is that over the next couple of years there some 11 additional distillery projects underway or being planned in Ireland. By 2020, the sector potential is projected to double to over 12 million cases exported annually, from current 6.2 million. But even at these levels, Irish whiskey will remain under-represented in the global markets compared to Scotch, unless Ireland gets serious at pushing up the value of its whiskey. And this can only be done by careful and rapid innovation and focus on high quality, specialist whiskeys.

The ISA clearly identifies core markets for Irish whiskey as the US, followed by the UK, with "...emerging markets such as Russia and China present significant opportunity for future export driven growth in the sector." Surprisingly, India is not cited. Neither is Japan. Both are big whiskey markets and both offer significant upside for quality premium whiskeys.