Monday 23 September 2019

Sense of Brexit worry has doubled among Ireland’s farmers, food producers

Tánaiste Simon Coveney said the report findings provide “further evidence that our SMEs remain exposed to the challenges ahead. Photo: Reuters
Tánaiste Simon Coveney said the report findings provide “further evidence that our SMEs remain exposed to the challenges ahead. Photo: Reuters

Shawn Pogatchnik

The level of anxiety over Brexit has doubled over the past year in an agri-food industry beset by “increasing pressure on multiple fronts”, according to professional services firm Ifac.

The surging sense of worry is highlighted in today’s publication of the Food and AgriBusiness 2019 report by Ifac, the umbrella group for farmers and food producers.

Compared with the same survey results a year ago, the proportion of members who now rate Brexit as a problem for their business has doubled to 42pc.

Amárach Research produced the finding by interviewing 200 owners, managing directors and chief executives of micro-businesses and SMEs (small and medium-sized enterprises).

“These owners are under increasing pressure on multiple fronts, from Brexit and climate change to trade deals and emerging market forces. It is, therefore, unsurprising that these findings would reveal a time of turbulence and uncertainty for most across the sector and confirm that these businesses are feeling less optimistic about the short-term future,” said David Leydon, head of food and agribusiness at Ifac.

Tanaiste Simon Coveney, in prepared remarks ahead of the report launch today, said the report findings provide “further evidence that our SMEs remain exposed to the challenges ahead. All of these businesses play an increasingly important role in Ireland’s local and national economy. They need to act and take on the professional advice that’s needed, from Ifac and others, so that they can sustain the jobs and wealth they have created, and respond to the challenges of the sector and Brexit.”

The Ifac-commissioned survey found that agrifood executives’ optimism had declined by 20pc, some 81pc said their profit margins were unchanged or worse than a year ago while 48pc reported increased sales, and just one in four planned to recruit new workers in the coming 12 months.

On the spending and finance front, 48pc of surveyed companies said they do not invest in R&D, the proportion of enterprises seeking bank loans had declined by 30pc over the past year, and 26pc of them receive State grants to help grow their business.

The survey does find high levels of product and process innovation to meet consumers’ changing tastes and recognition of the pressing need to reduce the industry’s carbon footprint. Some 74pc said they were trying to reduce their impact on the environment, with 43pc switching to recyclable, reusable or compostable packaging.

Mr Leydon said today’s report “contains advice and tools to support business owners through these challenges, and to grow profitable and sustainable businesses for the future. We believe that careful planning is the best way forward and with Ifac’s help business owners can optimise their tax structure, take a blended approach to finance, start to really plan their financial future, and build a robust business strategy.”

Ifac provides tax advisory, accountancy, pension planning, succession planning and other financial services to 19,000 members nationwide.

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