The weakening sterling is costing Irish processors €135,000 (£121,000) a week in the value of exports. The home market is also experiencing losses, due to competition from cheaper imports from sterling areas.
Irish poultry processors are losing 30% of the value of poultry exports. Sterling was at its lowest just before Christmas, when it was at near parity with the euro. In late January, £1 was worth about k0.93, compared with k0.70 to k0.80 a year ago.
“For every eight fillets we sell in Ireland we sell one leg, which means we have to export the remaining fillets, and most of those are denominated in sterling.
“So the effect of that is the cost of Irish fillet has risen, because the export value of legs has fallen as sterling has fallen. That is a big hit to us right now,” Vincent Carton, Irish Poultry Processors Association, told Poultry World.
A second, greater difficulty is also emerging for Irish processors, as Northern Irish processors (in the sterling area) are beginning to sell to the Republic of Ireland. “This week we are seeing, for the first time in Northern Ireland, processors offering very good value to the Irish multiples,” said Mr Carton.
This blow comes after a long, difficult period for the Irish poultry processing industry, which has seen half its companies close during the past seven years.
Feed prices are still expensive this year because, although wheat and barley prices are down, imported products like soya have had no significant reduction.
Other farming sectors have called for a special “sterling equalisation fund” to be set up by their governments to counter the damaging effects.
Irish poultry processers are losing 30% of the value of exports due to the weakening pound.