“A number of factors likely contributed to this increase in exports to the UK” states the report, “ranging from resurgent consumer demand to preparatory planning and stockpiling for potential Brexit shocks.”
Perhaps also of concern then, the report estimates that 90% of Irish cider exports go to the UK.
Since exports hit €161.8 million in 2010, the performance of Irish cider exports in the last decade has been a cause for concern.
The Irish cider industry has innovated significantly in recent years which has reinvigorated the market and resulted in more choice than ever for Irish cider consumers, according to the report. However Government supports are required in the coming months to assist the sector in dealing with the Covid-19 pandemic and to ensure it continues delivering for the Irish economy, according to the new report.
Drinks Ireland|Cider, which represents Irish cider-producers, said that the Covid-19 pandemic has severely impacted the sector with the closure of the on-trade.
Prior to this, total cider sales in 2019 decreased by 1.7%, falling from 64.3 million litres to 63.2 million, representing the first decline in sales since 2015.
Per capita consumption of cider declined by 0.47% to 0.8 Litres of Pure Alcohol in line with an overall trend of decline in total alcohol consumption.
Imported cider accounted for 20% of total cider consumption here in 2019, representing a gain for local cider sales of 0.4 percentage points to 80% from 2018’s 79.6% share.
Nevertheless, cider’s market share of total alcohol sales here declined marginally from 7.5% in 2018 to 7.4% in 2019. In 2010 it stood at 7.9%. But it remains Ireland’s third-most-popular alcohol beverage behind beer (44.6% of total alcohol market) and wine (27.2%) once the spirits category (20.8%) is split into its different variants (such as whiskey, vodka and gin).
Like other alcohol variants, cider makes a significant contribution to the Exchequer with just under €60 million-worth of excise collected (€59.8m) in 2019. This compares with €61.2m collected in 2018 and €61.0m in 2017.
Over the past decade it has contributed over half-a-billion €uro in excise alone to the Exchequer through Irish cider consumers who pay the third-highest rate of excise on cider in the European Union after Finland and Sweden. Fourteen Member States carry no excise charge on cider at all.
On a pint of cider/perry in an Irish bar costing €5.18, the total tax take is €1.50 or 28.9%. This comprises 23% VAT of 97 Cent and Excise of 53 Cent leaving €3.68 for the publican, distributor and producer to share.
Along with the wider drinks industry, the cider sector has been severely impacted by Covid-19.
With pubs, restaurants and hotels closed, Nielsen figures show that total alcohol sales volumes were down by 35.6% in April 2020 compared to April 2019.
Many craft producers do not have good off-trade reach in the domestic market and Drinks Ireland|Cider says that allowing them to sell directly online to the Irish consumer, without minimum volume requirements, would support the sector. It would also align Ireland with the majority of other European countries.
Drinks Ireland|Cider has called for urgent cashflow supports for cider producers including the deferral of all further excise and VAT payments until the crisis has passed. It has also called for a reduction of the commercial rate charge, in line with the reduction in turnover, for the period of the pandemic.
“While the way we drink has changed for now, with the hospitality sector closed, there are a range of Irish cider products on the market, perfect for trying at home on World Cider Day,“ said Seamus O’Hara, Chair of Drinks Ireland|Cider and Chief Executive of Carlow Brewing Company.
“Ireland’s cider industry has gone from strength to strength in recent years, and has made a vital contribution to the economy,” added Jonathan McDade, Head of Drinks Ireland|Cider, “While the Covid-19 pandemic has hit the cider industry ‑ like many other sectors ‑ hard, with adequate supports it can bounce back. In the immediate term, cashflow supports are required. We’re also calling for direct online selling to be allowed by craft cider producers as many may not have a large presence in the off-trade.”
“We also call on the Government to lobby for cider to be part of the EU Excise Structures Exemption. This will enable craft cider producers to secure excise relief reductions that are similar to those enjoyed by the craft beer sector.”