Food Drink Ireland (FDI) has called on the Government to extend the energy support schemes for business due to on-going cost competitiveness pressures.
The latest quarterly business monitor from FDI has shown ongoing challenges for indigenous food and drink manufacturers.
The key cost competitiveness issue continues to be high food inflation as well as long-term inflationary trends in transport and energy.
According to the Ibec group that represents the food and drink sector, reality of high input business costs will be further exacerbated by the introduction of border controls in Great Britain, from 31 October.
It is essential that Government help the sector offset high energy costs by extending the two energy support schemes (TBESS and UECS) to the end of 2023 and amending the qualification criteria so more companies can avail of the supports, FDI noted.
“The food and drink sector continues to endure during challenging times and faces ongoing costs due to Brexit and more specifically the forthcoming introduction of border controls to our largest export market which is why FDI is calling for the extension of the Government’s two energy support schemes,” highlighted Jonathan McDade, deputy director of Food Drink Ireland.
Inflation continues to be an issue with food & non-alcoholic beverages in June rising by 10.2% compared to the same month last year.
However, the pace of inflation has slowed. Long terms trends however show significant increases in wages, transport costs and wholesale energy prices compared to three years ago.
Prices on average in Ireland, as measured by the EU Harmonised Index of Consumer Prices (HICP), increased by 4.8% in June 2023 compared with June 2022.
An encouraging development has seen the increase in consumer sentiment.
The volume of retail sales (excluding bars & motor) increased 1.0% when looking at the three-month moving average (March, April, May 2023) versus the same months last year, with the value of sales increasing 4.5% over the same period.