Ireland: ‘Worst year in living memory’

Ireland’s drinks sector endured its worst year in living memory in 2009 as per capita consumption fell to the lowest level since the mid-1990s.

Some 15,000 drinks industry employees – one in six of the sector’s workforce – have lost their jobs in the past 18 months because of falling sales and the increase in cross-border shopping in Northern Ireland.

According to the Drinks Industry Group of Ireland (DIGI), per capita consumption has plummeted by 21% since the peak of the ‘Celtic Tiger’ economic boom in 2001, falling to levels not seen since 1995/6.

‘As predicted, 2009 turned out to be an even poorer year than 2008 for drinks industry sales and consumption in Ireland, meaning that it was the worst year for our industry in living memory,’ said DIGI chairman Kieran Tobin.

Spirits were worst-affected with an 18.5% slump in sales, while wine sales fell 6.9% and beer was down 6.5%, according to DIGI’s ‘Drinks Market Performance 2009’ report.

Meanwhile, the disproportionate fall in on-trade revenues means that retail now accounts for more than 50% of the Irish drinks market.

‘Prospects for 2010 remain weak,’ said Dublin City University economist Anthony Foley, the report’s author.

‘DIGI estimates that alcohol volumes will continue to decrease this year by 5%, but that there will be larger proportionate declines in the on-trade, with a knock-on effect on jobs and employment.’

However, Tobin welcomed the 20% reduction in excise duty announced in the 2010 Budget, which he said was a ‘crucial first step’ in building consumer confidence and cutting cross-border shopping.

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Written by Richard Woodard