Optimism levels among Irish food and agribusiness SMEs has plummeted to a five-year low, research shows.
According to IFAC's, fifth annual Food and Agribusiness Report 2022 titled ‘The big SME squeeze’ – the only report focused exclusively on the pulse of Irish food and agribusiness SMEs.
The data indicated that this drop of 23 percentage points was a 'significant' departure from last year's findings, which showed a marked rebound in optimism levels in 2021 to a four-year high of 77%.
The report, conducted once again by Amárach Research during June and July 2022, includes the views of those that run some of the most innovative agtech companies and many household food brands – all a vital part of our rural and regional economies, Ireland’s farming, food and agribusiness specialist professional services firm noted.
Major Food Producer
Referring to the Irish food sector, Leo Clancy, chief executive officer, Enterprise Ireland pointed at the role Ireland has globally as a major food producer.
"In terms of our ambition for the sector, we need to remind ourselves that we operate in a global economy, which is facing significant food shortages," he said.
"We already contribute hugely to global nutrition at a very high standard. We can continue to grow our food and agri output sustainably."
The findings of this report cement what businesses and consumers are now feeling – that the coming year will be much more difficult.
There are several key factors why Irish food and agribusiness SMEs are disillusioned, the group added.
36% of businesses have experienced a 21% or higher increase in input costs (84% reported an increase in costs this year).
In addition, the cost of stock management has risen dramatically because of disrupted supply chains.
Also, salary expectations are increasingly becoming a barrier, with two in three businesses finding it difficult to recruit the right people.
David Leydon, head of Food and Agribusiness, IFAC, highlighted that this is a tough time for Irish food and agribusiness SMEs following a global pandemic.
“At IFAC, we have many more ways to help food and agribusiness during these turbulent times and some are documented within this year’s report.
"Ultimately we share the goal of SMEs across the sector – to ensure that Irish and international consumers alike can enjoy the very best products Ireland has to offer.”