ANNUAL REPORT & ACCOUNTS 2013 Growingthe thesuccess successofofIrish Irishfood food&&horticulture horticulture Growing Our Mission To drive through market insight and, in partnership with industry, the commercial success of a world class Irish food, drink and horticulture industry. Strategic Objectives Bord Bia’s mission is further articulated through the following six strategic objectives: 1. To actively contribute to the success and development of the Irish food and horticulture industry. 2. To positively influence attitudes towards, and knowledge of, Irish food and horticulture among consumer and trade buyers in our target markets. 3. To establish Bord Bia as the top-of-mind source for authoritative market research and analysis, providing a link between market opportunities and the Irish food and horticulture industry. 4. To lead a collaborative approach to market development with the key agencies involved in serving Irish food and horticulture. 5. To actively respond to significant market issues that affect the industry. 6. To deliver value-for-money with expenditures. 02 Bord Bia Irish Food Board Annual Report 2013 STATEMENT OF STRATEGY 2012 – 2014 The Bord Bia Strategic Plan 2012-2014 is based on an inclusive view of the entire industry with the goal of driving long-term sustainable growth. It has been developed to fully support the implementation of Pathways for Growth and Food Harvest 2020 and includes the following priorities: Building Ireland’s Reputation – Develop, implement, and promote a shared vision of Ireland as a world-leader in safe and sustainable agriculture and food production consistent with a premium positioning in the marketplace Enhancing Competitiveness – Promote industry’s market competitiveness by championing an integrated approach, leveraging existing strengths and exploiting synergies across sectors and firms; supporting innovation; and building capabilities where necessary Building Exports – Strengthen and extend the ability of Irish food and drink companies, driven through market insight, to build profitable share in selected highpotential export markets A Vibrant Home Market – Support and progress the strong position that the agri-food sector currently occupies within the broader Irish economy Bord Bia Irish Food Board Annual Report 2013 03 Our farms have been looked after by generation after generation of families. Our fishing industry too. All caretakers… custodians… protectors… Because every generation has acknowledged one simple fact: that this land belongs not to us… but to the ones who come after. 04 Bord Bia Irish Food Board Annual Report 2013 SUSTAINABILITY WORKING WITH NATURE “Sustainable development is development that meets the needs of the present without compromising the ability of future generations to meet their own needs.”Brundtland Commission of the United Nations 20th March 1987. S ince the launch of Origin Green in 2012, the Bord Bia sustainability development programme, almost 300 Irish food and drink companies, representing over 70% of Ireland’s exports have joined the initiative and committed to clear targets in key areas of sustainability, such as emissions, energy, waste, water, biodiversity and CSR (corporate social responsibility) activities. Development of the Origin Green initiative has continued throughout 2013 and to aid and assist food and drink companies develop their sustainability plans a `step by step guide to developing your Origin Green plan’ was launched by Bord Bia during the year. In addition, a Carbon Navigator Tool was developed by Teagasc and Bord Bia to provide farmers with measures on their sustainability performance and how farm performance can be improved. Following eighteen months of planning by Bord Bia in conjunction with stakeholder groups, comprising producers, milk processors and regulatory authorities, a new National ‘Sustainable Dairy Assurance Scheme’ (SDAS) was launched during December 2013. Commenting on the programme the Minister for Agriculture, Food and the Marine, Simon Coveney TD said “This programme positions Irish producers and processors as “best in class” and is a perfect fit with the corporate responsibility strategies that inform procurement policies in multi-national purchasers of Irish dairy products and ingredients across the globe.” Building awareness of Origin Green also continued during 2013 and for the first time in the history of RTE, the centre break during the 9 o’clock news was taken over by the striking four minute Origin Green film featuring Saoirse Ronan, reflecting the importance of this sustainability initiative to Ireland and the economy. During September, Bord Bia organised its inaugural global sustainability conference, “Our Food Our Future, Sustainability: The Bottom Line”, at the Convention Centre, Dublin. The conference was attended by 750 delegates. Seventeen keynote speakers discussed what producing food more sustainably means, challenged each other regarding the obstacles to be overcome and shared their unique insights on what the future holds. The conference was a business development initiative built around on-site visits to food processors that have embarked on the journey of sustainability. Following an induction at the Smurfit Graduate School of Business and on farms and factories, ten Origin Green ambassadors, recruited in September and co-funded by Bord Bia and industry, will begin their placements with major international food businesses around the world from January 2014, spreading the vision and the message of Origin Green. In addition, an integrated communications campaign was launched to drive a preference for Origin Green suppliers to result in export growth and includes trade advertising, showcasing Origin Green at International Trade Shows, speaking at international conferences, overseas office communications and engaging key stakeholders and advocates. The goals of Origin Green are in alignment with international best practice in sustainability and our goal is that by 2016 all food and drink exports from farms and food businesses are certified as on the road to sustainability. Bord Bia Irish Food Board Annual Report 2013 05 Contents Our Business Our Governance 08 Food and Drinks Industry Awards 45 Corporate Statement 10 Export Figures 48 Statement on Internal Financial Control 14 Chairman’s Statement 49 Organisation Structure 18 Chief Executive’s Review 51 Bord Bia Board 28 Sector Reviews: 28 Meat & Livestock 31 Food & Beverages 34 Small Business & Organic Sectors 36 Horticulture 39Services 52 Bord Bia Consumer Foods Board 52 Bord Bia Meat and Livestock Board 53 Bord Bia Dairy Board 53 Bord Bia Quality Assurance Board 54 Bord Bia Horticulture Board Our Accounts 57 Report of the Comptroller and Auditor General 58 Statement of Accounting Policies 60 Income and Expenditure Account 61 Statement of Total Recognised Gains and Losses 62 Balance Sheet 63 Cash Flow Statement 64 Notes Forming Part of the Financial Statements 74 Marketing Finance Grant Payments Presentation to the Minister for Agriculture, Food and the Marine In accordance with Section 22 of An Bord Bia Act 1994, the Board is pleased to submit to the Minister its Annual Report and Accounts for the 12 months ending 31st December 2013. Michael Carey Chairman 06 Bord Bia Irish Food Board Annual Report 2013 Our Business Bord Bia Irish Food Board Annual Report 2013 07 The Irish Food and Drink Industry Awards The achievements and contributions of nine Irish food companies were recognised at the Bord Bia Food and Drink Awards which are held every two years and are designed to reward excellence within the Irish food and drink industry across seven categories – Exporting, Branding, Entrepreneurial, Success at Home, Sustainability, Consumer Insight and Innovation. Over 250 industry representatives gathered for the event including the CEOs from some of Ireland’s leading food and drink companies such as Kerry, Glanbia, Irish Distillers, ABP, Dawn Meats and Kepak. industry. Pat Whelan of James Whelan Butchers, Ireland’s first online butcher, was awarded the title as a ‘best in class’ example of how to increase sales and brand awareness through online and social media. Opening the event the Minister for Agriculture, Food and the Marine, Simon Coveney TD said “As ever with the food and drink industry, we are here to celebrate exceptional resilience and performance at the ‘Oscars’ of the sector. Individual food and drink companies, who are being recognised this evening, can take pride in their achievements in growth, in new business and even deeper insight into buyer needs and consumer trends.” Meanwhile, ABP Ireland was also honoured with the inaugural ‘Business Referral Award’, in recognition of their co-opetition efforts. Bord Bia is actively supporting the principle of coopetition, where food companies work together to create synergies resulting in cost savings, improved returns and reputation, and increased market distribution. ABP Ireland introduced Wexford based sheep meat company, Irish Country Meats, to a European foodservice client in order to address a supply issue for their customer. Irish Country Meats now deliver Irish lamb weekly to this foodservice client. Speaking at the event, Michael Carey, Chairman, Bord Bia said “This year’s Awards coincide with the fourth successive year of sustained growth in our food and drink exports. As the industry continues to develop and expand into new and emerging markets, it is important to recognise the continued progress and achievements of the sector.” Special Awards This year, Bord Bia introduced a new Award to reward an ‘Online Champion’, in recognition of the impact the digital age is having on the 08 Bord Bia Irish Food Board Annual Report 2013 Congratulating the award winners, Aidan Cotter, Chief Executive, Bord Bia described their achievements as “a fitting showcase of an industry on the rise, building success at home and abroad, and positioning food and drink firmly at the centre of our economic recovery. It is this talent, imagination and sheer professionalism that is at the heart of the industry’s current success and that will secure its continued growth and expansion”. The Bord Bia Food and Drink Awards were open to all food and drink products manufactured in Ireland. This year, Bord Bia received in excess of 140 award entries across seven categories which were judged by an independent judging panel. The overall category award winners included: • Export Award – Glenmar Shellfish. Based in Union Hall, Co. Cork and established over 30 years ago, Glenmar is currently exporting over 2,000 tonnes of shellfish each year to markets such as China, Hong Kong, Korea, Italy, Spain, France and Croatia. They export to seven overseas markets on a daily basis and exports account for 75% of company turnover. • Innovation Award – Paganini for FitFuel, a protein enriched ice cream range. FitFuel Perform is a recovery product for sportspeople and recreational athletes, while FitFuel Nourish is used by healthcare professionals to boost the protein intake of patients. Paganini was founded by Wexford dairy farmer, Tomas Murphy in 1990 and today, in addition to its business in Ireland, they export to the UK and the Middle East. • S uccess at Home Award – Britvic Ireland for MiWadi, the number one dilute brand in Ireland. MiWadi impressed the judges with a 41% yearly average value market share, having achieved considerable success in recent years with the relaunch of MiWadi, and the launch of double concentrate and no added sugar flavours. • Sustainability Award – Dawn Meats, the Waterford based meat exporter, has formalised its approach to sustainability and set a number of demanding targets as part of Origin Green, Bord Bia’s sustainability development programme for the Irish food and drink industry. Dawn Meats is working to reduce water use by 40%, reduce energy consumption by 40% and to reduce its direct carbon footprint by 50%. • Branding Award – Keelings, the family owned fresh produce business started producing fruits and salads in the 1930’s and today the company employs approximately 2,000 people and has a turnover of €300 million per year. The Keelings brand, with its strapline “Love to Grow”, was launched into the produce category in 2010 and has become the most recognised brand for fruit and vegetables in Irish supermarkets. • Entrepreneurial Award – Irish Atlantic Salt. The O’Neill family developed this range of organic, gourmet Irish sea salt products, using the highest quality waters around the Beara Peninsula to create the only Irish-made white sea salt product available. By 2015, the company hopes export market revenues will represent 80% of total revenues. • Consumer Insight Award – Kerry Foods for Cheestrings, a brand, worth approximately €90 million, and available in over 25,000 stores around the world. The judges were particularly impressed by the detailed consumer research undertaken by Kerry in advance of entering the German market. The resultant consumer insight helped build its product positioning which has led to 1 million packs being sold every month in leading German retailers. Bord Bia Irish Food Board Annual Report 2013 09 Exports of Irish food and drink (€m) 2012 2013 (p) Live Animals Sheepmeat Poultry Edible Horticulture & Cereals Seafood Pigmeat Beverages Prepared Foods Beef* Dairy Products & Ingredients* 0 500 1,000 1,500 2,000 2,500 3,000 (p) = 2013 figures are provisional The Irish food and drink sector continued the strong export performance of recent years despite the ongoing competitive nature of most markets. Trade was boosted by strong global prices and higher output in key sectors, which helped offset some strengthening of the euro against major currencies. The strongest performers were dairy, meat & livestock and prepared foods. A competitive market environment led to slower beverage exports, although whiskey continued to perform very strongly. Seafood saw a levelling off in exports following a rise of almost 65% over the 2009 to 2012 period. Exports reach almost €10 Billion for the first time “Significant growth in 2013 has brought export values in the Irish Food and Drink sector to record levels. This leading performance in what was a challenging year for the industry, highlights the key role of agri-food, Ireland’s largest indigenous sector, in underpinning exports and economic activity. Export values of almost €10 billion are really impressive, and demonstrate the clear opportunity and benefit of investing in a sector with proven resilience, a significant domestic economic footprint and strong ability to grow. With increasing demand from more affluent consumers in key world markets, there is little doubt that the €12 billion export target set out in the industry-led strategy for the agri sector Food Harvest 2020 is well in sight.” Minister for Agriculture, Food and the Marine, Simon Coveney TD. 10 Bord Bia Irish Food Board Annual Report 2013 2012 2013 (p) 2013/2012 €m €m % +/- Dairy Products and Ingredients* 2,636 2,995 +14 Beef* 1,900 2,090 +10 Prepared Foods 1,439 1,650 +15 Beverages 1,209 1,198 -1 Pigmeat 510 557 +9 Seafood 534 489 -8 Edible Horticulture and Cereals 228 222 -3 Poultry 223 234 +5 Sheepmeat 218 226 +4 Live Animals 217 240 +11 9,114 9,901 +9 Total Food and Drinks *includes export refunds Source: Bord Bia estimates (p) = 2013 figures are provisional •Food and Drink exports increased by 9% to approach €10 billion for the first time •Exports in 2013 were 40% or €3 billion higher than the levels recorded in 2009 •Ireland’s food and drink has a large global reach – exporting to 175 countries worldwide •Ireland is the 4th largest net exporter of beef in the northern hemisphere •Produces 10%+ of global infant formula •Produces 50%+ of all global cream liqueur •Irish whiskey is the fastest growing spirit category in the world •Ireland is home to some of the world’s most iconic food and drink brands •Ireland has been chosen as a location for investment by major food, drink and infant nutrition companies •The Irish food and drink industry supports more than 250,000 jobs directly and indirectly Bord Bia Irish Food Board Annual Report 2013 11 Market distribution of Irish food and drink exports (%) International Markets 26% United Kingdom 42% Other EU 32% 45 40 35 42 42 30 31 25 32 27 20 26 15 10 5 2012 0 2013 (p) United Kingdom Other EU The market distribution of Irish food and drink exports settled down during 2013 following the rise in the share of trade going to International markets over recent years. This was led by the stronger performance of Continental EU markets. International trade continued to be driven by strong exports to Asia and Russia. The share of exports destined for the United Kingdom remained at 42%. Trade increased in line with overall food and drink exports to stand at an estimated €4.2 billion. The main drivers of export growth were beef, dairy and to a lesser extent prepared foods. 12 Bord Bia Irish Food Board Annual Report 2013 International Markets Following a difficult trade in 2012 due to slow economic demand and more favourable trade elsewhere, exports of food and drink to Continental EU markets rebounded impressively in 2013. Exports are estimated to have increased by 11% to reach around €3.2 billion, which represents over 32% of the total. Key markets included Germany, France and the Netherlands, all of which recorded double digit growth. Shipments of Irish food and drink products to International markets built on the impressive performance of the previous two years, which saw the value of trade jump by almost 30%. Exports increased by around 6% to reach almost €2.6 billion. Distribution of food and drink exports – 2013 vs. 2012 (€m) 4500 4000 3500 4,200 3,890 3000 3,150 2,810 2500 2,410 2000 2,550 1500 1000 2012 500 2013 (p) 0 Other EU United Kingdom International Markets Growth in food and drink exports to International Markets – 2013 vs. 2012 (%) 45 40 40 35 38 30 25 20 21 15 10 5 2 0 China Russia South East Asia Africa 0 Middle East Bord Bia Irish Food Board Annual Report 2013 13 Chairman’s Statement For many in the Irish food and drink industry, 2013 will be remembered as a year when achievement surpassed expectations in a number of key respects. The most obvious, of course, was in the scale of the growth recorded. An increase of 9% over the 2012 figures saw Irish food and drink exporters touch the watershed mark of €10 billion for the first time. This rate of growth, more than four times greater than that achieved in 2012, was delivered against the backdrop of continued competitive pressure in many key marketplaces and contributed to aggregate export growth of 40% for the industry over the last four years. Irish food and drink exports are now worth almost €3 billion more than in 2009, when the current phase of expansion can be said to have begun. Favourable economic headwinds have undoubtedly underwritten this remarkably assured performance, the single most important being the continued buoyancy of key commodity prices, largely as a result of growing demand for high quality foodstuffs in the world’s developing economies. Credit for the strong performance also lies within the industry itself. Higher outputs in key sectors provided a platform for a strengthened export performance in areas such as dairy, meat and livestock in 2013, while a number of significant industry-wide developments collectively served to underpin the sector’s determination to continue on its sustainable growth path. While the food and drink industry has long held the claim of Ireland’s most global indigenous industry, the impressive geographical diversity of Irish exports in 2013 – in many cases despite the strengthening of the euro against key trading currencies – has confirmed the vibrancy and evolving nature of these international trade relationships, extended and enhanced on the basis of an industry-wide commitment to innovation, excellence and value. 14 Bord Bia Irish Food Board Annual Report 2013 Challenges The sector’s strong performance came in a period when global economic recovery showed, although still tentative, signs of genuine progress. The achievement of the Irish food and drink industry in 2013 can be set against the more nuanced performance of general Irish merchandise exports, which, after a number of years of positive growth, fell by an estimated 6%. Food and drink exports now account for two thirds of total indigenous exports. These figures must also be considered against what was a rather inauspicious beginning to the year for the industry. A protracted spell of cold weather in the spring and early summer brought hardship and had significant cost implications for the farming community at the time. It was most visible in the reduced average carcase weights in the beef and sheepmeat processing sectors for the remainder of the year. Meanwhile, the emergence of the equine DNA issue in January saw traceability once again brought to the fore as a concern in the European food supply chain. On 15th January 2013, the Food Safety Authority of Ireland (FSAI) revealed samples taken from retail beef burgers tested positive for traces of equine DNA. Subsequent investigations confirmed the issue to be a European-wide one, with implications for many major manufacturers and brands. For consumers, the unfolding events raised a number of trust issues and threw the spotlight on the robustness of traceability within prepared food processing. A loss of confidence in some segments was perhaps inevitable. However the fallout from the equine DNA issue has ultimately seen renewed focus on traceability. Ireland’s rigorous approach to the issue saw it enhance its reputation as an industry governed by a transparent and uncompromising food safety regime. Recognition of the value of quality assurance schemes was also reflected in a significant increase in membership of the Bord Bia Beef and Lamb Quality Assurance Scheme, with more than 10,000 new members joining in 2013. Price pressures While the industry’s performance over the year mirrored generally strong global commodity prices, it is worth noting that the FAO Food Price Index actually showed a marginal decline in farmgate prices in 2013, reminding us that, although global commodity prices remain some 60% ahead of the 2000 to 2010 averages, it is unrealistic to expect them to maintain an upwardonly trajectory. The sectors chiefly impacted by price falls were sugar, oil and cereal, which contrasted with the upward pressure on both dairy and meat prices. With the caveat of unpredictability noted, however, the forecast continues to be largely positive for sectors of most relevance to Ireland. Inflation has become an important indicator of the industry’s ability to recover costs in the face of price sensitivity and the intense focus on discounting that has been a feature of retailing over the last five years. While inflation levels remained generally low across the euro zone in 2013, retail food price increases were somewhat more pronounced. Taken as a whole, indeed, food price inflation ran at more than twice the level of general inflation, providing some welcome recovery of margin to operators. The expected strengthening of the euro zone economy in 2014 is likely to have further positive repercussions in this area for Irish exporters although general economic forecasts indicate inflation will remain marginal in the euro zone economies. Another persistent challenge outside the control of exporters is the euro’s relationship with key trading currencies. A strengthening of 5% and 3% against sterling and the US dollar respectively in 2013 put further pressure on margins but the industry’s adeptness of response and relentless focus on competitiveness meant this did not present the challenges encountered in 2010/2011, when there was a sudden and sizable strengthening of the euro. Industry trends Against many challenges, the sense of resilience and optimism in the food and drink industry has been noteworthy over the last number of years. The annual Bord Bia industry survey, completed at the end of each year, provides an ideal opportunity for the sector to offer its own perspective on its achievements and future prospects. The December 2013 survey showed individual company experiences to be reflective of the positive broader story, with more than eight out of 10 business owners reporting higher or similar turnover over the last 12 months than the year before. Optimism that companies remain on track for further growth was also widespread, with some 75% of exporters expecting to increase sales in 2014. Respondents also confirmed that a commitment to broadening market reach and to innovation will underscore this growth. In 2013, 72% of companies increased sales by finding new customers for existing products; 59% by providing new products to existing customers; and 59% by offering new products to new customers. The correlation between innovation and growth was further confirmed by the finding that 91% of exporters have introduced new products over the last three years. Typically, this NPD (new product development) is evolutionary rather than revolutionary (new pack sizes and new flavours or variants of existing products, for example) and serve to confirm that responsiveness to consumer and buyer requirements is inherent in the DNA of the Irish food and drink industry. Bord Bia Irish Food Board Annual Report 2013 15 The expectation is that, by the end of 2014, 75% Bord Bia’s role as an instigator and conduit of insightful consumer research is one among many valued roles, and outputs such as the global PERIscope study continues to update the industry on developments in consumer behaviour, purchasing attitudes and shopping trends. Insights identified in 2013 include the trends of ‘back to basics’ and ‘foodie world’ – both of which emphasise traditional, communal eating and focus on higherquality home cooking. Other significant trends include ‘the environment’ and ‘health and wellness’, the former linked to a greater appreciation of environmentally-conscious companies and the latter reflecting a search for food solutions that give consumers greater control over their health. Bord Bia’s insight on the particular ways in which smartphones are being used to get information as consumers shop garnered considerable media coverage in the latter half of 2013. I congratulate the research and insights team on being awarded the qualitative research excellence award by the Marketing Society in 2013 for ethnographic research undertaken for Glanbia in Senegal. International trade In December 2013, the World Trade Organisation returned to international headlines with news from Bali, Indonesia, of its first comprehensive agreement involving all 160 participating countries. While relatively small in scope, the announcement has been welcomed as signal of intent by the WTO (World Trade Organisation) to pursue its broader agenda of liberalising global trade and providing it with more transparent and more predictable rules. The 2013 development is seen as being particularly important to developing countries where it will enhance food security while also freeing up international trade opportunities. of Ireland’s food and drinks exports will be from Origin Green verified members Earlier in the year, in the closing days of Ireland’s highly successful hosting of the European Presidency, agreement on reform was also reached in the EU’s Common Agricultural Policy (CAP). The concluded agreement provides for more flexibility in the way direct payments are distributed within Member States and, after a long period of uncertainty, provides a sense of clarity for the future direction of Irish farming. For the industry as a whole, it sets out a platform for sustainable growth that is consistent with the goals espoused by the Department of Agriculture, Food and the Marine in Food Harvest 2020 and should accrue long-term benefits for farm families, the food industry and the broader rural communities. Strategic plan Since its launch in 2010, Food Harvest 2020, the Department of Agriculture, Food and the Marine’s framework document for the growth and development of the agri-food industry, has provided the broader context for Bord Bia’s evolving suite of marketing supports. Food Harvest 2020 has facilitated an industrywide re-evaluation of our goals and strengths as a food producing nation and, with the first three years of this 10-year plan now completed, it is gratifying to note the sense of progress that has accompanied it. This was the second full year of the current Bord Bia Strategic Plan 2012-2014. Initiated to provide continued clarity of direction to the organisation, the Strategic Plan ensures our mission statement of supporting and championing the Irish food and drink industry is reflected in activities that maximise our effectiveness and sense of purpose. The Strategic Plan has four key priorities: • Building Ireland’s Reputation • Enhancing Competitiveness • Building Exports • A Vibrant Home Market 16 Bord Bia Irish Food Board Annual Report 2013 Bord Bia takes the view that each support, activity or programme it undertakes on behalf of industry should reflect at least one of these four priorities and be assessed for its effectiveness in relation to them. The Chief Executive elaborates further on this approach and the strategic priorities in his review. Suffice it to say here that I believe the Strategic Plan has been highly effective in measuring our performance against the expectations and needs of our many stakeholders. Conclusion In 2013, the Irish food and drink industry provided the strongest evidence yet that the growth potential for the sector, as identified by Food Harvest 2020, is not only achievable but, in many respects, ahead of target. It would be remiss to speak about the industry’s achievements in 2013 without commenting on the commitment to future development expressed through Origin Green, the Bord Bia sustainability development programme launched in 2012. In its first complete year, almost 300 Irish food and drink companies, representing over 70% of Ireland’s exports, signed up to the programme, committing to clear targets in key areas of sustainability, such as emissions, energy, waste, water, biodiversity and CSR (corporate social responsibility) activities. The expectation is that, by the end of 2014, 75% of Ireland’s food and drinks exports will be from Origin Green verified members, demonstrating ongoing robust improvements in their sustainability performances. Looking to 2014, we can also remain broadly positive that, notwithstanding climactic, economic and exchange rate issues outside our control, the outlook is broadly positive. Increased output in some sectors combined with ongoing strong demand in emerging economies provide grounds for this optimism; on the other hand, the weakness of consumer sentiment in more established markets remains a key risk. The critical role that Irish food and drink businesses play in the generation of wealth and employment, particularly in Ireland’s rural economy, continued to evidence itself in 2013. This is an industry with an increasingly powerful vision of the role it can play in the Irish economy and as a responsible participant in our evolving conversation on sustainability and the stewardship of our natural resources. During 2013, for the first time in the history of RTE, the centre break of a 9 o’clock RTE news broadcast was taken over by a striking four minute film in which Saoirse Ronan shared the story of Origin Green. Through this the importance of the entire industry to Ireland and its economy was powerfully communicated. In the year ahead, Bord Bia is fully committed to playing its role in a variety of powerful ways: as a conduit of resources, a source of expertise and in the provision of market intelligence to our diverse and dynamic client base. The role of Chairman of Bord Bia affords a unique viewpoint from which to view the trajectory of an organisation and the industry it serves. This was enhanced during the year by the establishment of a dairy subsidiary board following agreement by the sector to provide voluntary funding to finance an enhancement of the communication platform for the dairy sector and to fund the new sustainable dairy assurance scheme. I have the extreme good fortune of being supported by a body of worldclass expertise in the form of the Board and the now five subsidiary boards and to these individuals I express both my debt and my gratitude for their assistance over the year. I would particularly like to commend my colleagues for the support and insight they provided at the beginning of the year when the equine DNA issue emerged. To those members who departed in 2013, I thank them sincerely for their services and to those who have joined us in this time I extend a warm welcome. The Minister for Agriculture, Food and the Marine, Simon Coveney TD, Minister of State at the Department of Agriculture, Food and the Marine, Tom Hayes, TD, Secretary General Tom Moran and all the staff at the Department of Agriculture, Food and the Marine are equally deserving of high praise and considerable gratitude for their hard work and dedication to the industry during the year. Minister Coveney played a decisive role in the successful completion of the CAP negotiations during Ireland’s EU presidency and in securing a deal that will pay dividends for farming communities and the food industry far into the future. I am pleased too that the closer working relationships between Bord Bia, Enterprise Ireland, Teagasc and Bord Iascaigh Mhara evident in the last few years continues to prosper, for the benefit of the industry all of us serve. I single out for commendation, also, the OPW, whose support and commitment to Bloom is instrumental to its success and the Department of Foreign Affairs, who, through their personnel and expertise, provide an extraordinary resource for our industry as it seeks out new markets around the globe. In the success of any strategy, much depends on the calibre of those entrusted with its execution. The management and staff of Bord Bia have once again delivered an exceptionally strong performance on behalf of the industry and I would like to thank Chief Executive Aidan Cotter for his support and offer his team of professionals my personal thanks on behalf of the industry. Fitting recognition of this commitment was the awarding of an Honorary Degree of Doctor of Laws from UCD to Aidan for his contribution to the industry over the last 30 years. I am also delighted to recognise the award of Chevalier de l’Ordre Mondial de L’Académie Culinaire de France or Knight of the Academy’s Worldwide Order in 2013 to Bernadette Byrne of Bord Bia’s Paris Office from L’Académie Culinaire de France, the oldest association of culinary and pastry chefs in the world. Although the poor start to the year provided an unwelcome additional burden to those who have worked hard to sustain the success of the Irish food and drink industry over the last few years, no one can dispute the story of 2013 was one of success for the industry. With a growing sense that the wider economy has finally turned the corner, the Irish food and drink industry confirmed, through its resolute export performance, that optimism need not be a matter of future gazing. The path of growth it has chosen is strengthening and extending its global footprint both now and in the future. As the industry finds new markets across the globe, Bord Bia is delighted to play the role of catalyst and partner as new trading relationships prosper alongside longer standing ones. Michael Carey Chairman Additional information and updates on Bord Bia activities can be obtained from www.bordbia.ie or by following us online at www.facebook.com/ bordbia or on Twitter@bordbia Bord Bia Irish Food Board Annual Report 2013 17 Chief Executive’s Review Food, drink and horticulture collectively represent Ireland’s largest indigenous industry and the sector’s record of export success is firmly established with core strengths: a geography and environment conducive to high-quality outputs; an industry committed to world-class production standards; and access to and the capacity to meet the diverse needs of many marketplaces. While it is natural to view these in terms of a linear progression, it is well to remind ourselves that the measure of success in fact begins at the end point – in the relationship we build with our consumers. How we respond to, and meet, their needs is the enduring yardstick of our industry’s performance. In 2013, we can say with some confidence that the Irish food and drink industry has met these challenges to a noteworthy and even historic degree. Approaching €10 billion in value for the first time, the 2013 export figures represent a 9% year-on-year increase and mean that, over the last four years, export revenues for the sector have grown by almost 40%. The strong overall trade figures for 2013 came against a backdrop that, while broadly conducive to growth, presented some familiar – and occasionally some unexpected – 98 18 challenges: 2013 was a year when the signals of economic recovery finally began to strengthen in some of our main export markets, but one where consumer sentiment often lagged behind; one where food labelling issues came to the fore, requiring many in the industry to scrutinise their supply chains and to reappraise the value of robust and verifiable traceability procedures; and a year when the Irish farming community experienced considerable hardship as a long and protracted cold spell impacted significantly on the cost of inputs and, ultimately, the scale of outputs. On the political front, 2013 was significant for a broadly positive outcome to the renegotiation of the Common Agricultural Policy, which successfully reached its conclusion under the Irish Presidency of the EU. This outcome provides the necessary context for continued strong performances by the Irish food and drink industry in the years ahead. Irish companies exhibited with Bord Bia at Bord Bia Irish Food Board Annual Report 2013 Strategic evolution As a marketing support agency, Bord Bia’s role centres on providing assistance to food and drink companies as they develop and implement their strategies for growth. We do this in a myriad of ways. Some undertakings, like Bord Bia’s participation in key international trade fairs, may be viewed as longstanding industry supports, others, such as launch of the Bord Bia Quality Kitchen, were entirely new in 2013. Whatever the initiative, whomever the audience, Bord Bia’s outputs share the common feature of working with, and standing behind, the industry as it enhances its capacity to engage effectively with its customers and consumers. In 2012, Bord Bia launched the three-year Statement of Strategy 2012-2014 to provide clarity, direction and transparency in the future operation of our market supports. As an organisation that has always striven 18 International trade shows 1. Chief Executive, Aidan Cotter speaking at ‘Our Food Our Future’ 1. to maximise the value it provides to its multiple stakeholders, the Strategic Plan presented a welcome opportunity to renew our focus on value for money and to clarify, wherever possible, the return on investment that our services offer. The Statement of Strategy also operates as a dynamic statement of intent, underscoring Bord Bia’s commitment to the Department of Agriculture, Food and the Marine’s Food Harvest 2020. Throughout 2013, it provided a powerful touchstone against which the many initiatives undertaken in the home and export markets could be measured and assessed. The four strategic priorities set out in the plan are: 1. Building Ireland’s Reputation 2. Enhancing Competitiveness 3. Building Exports 4. A Vibrant Home Market Reporting progress on each of these strategic priorities provides clarity and accountability to stakeholders on the role we play as a marketing agency: Strategic Priority 1: Building Ireland’s Reputation Develop, implement, and promote a shared vision of Ireland as a world leader in safe and sustainable agriculture and food production consistent with a premium positioning in the marketplace. 2. The food and drink industry understands, better than most, that reputation underscores all value propositions. Protecting and enhancing Ireland’s long cherished reputation as a source of high-quality food and drink is central to Bord Bia’s mission statement. • Origin Green In June 2012, Bord Bia launched Origin Green, a voluntary programme designed to support the Irish food and drink industry’s journey to a leading global position in sustainability. As 2013 progressed, it was clear the early momentum of the launch would be sustained and Origin Green was widely and enthusiastically embraced by industry. By the end of the year, 300 companies had signed up to the programme. Of these, 39 had already become verified members of the programme, 50 had sustainability plans submitted for verification and 211 were at workshop/plan development stage. As of the end of 2013, verified members represented well over 50% of Ireland’s food, drink and horticulture exports and, by the end of 2014, that figure is expected to rise to 75%. The credibility of Origin Green is underpinned by the involvement of leading testing and certification company, the SGS Group, which verifies each company’s plan. Sharing the message of Origin Green to a global audience requires a careful and strategic approach and, in 2013, an important first step came with the recruitment of 10 global Origin Green 2. Saoirse Ronan and Minister for Agriculture, Food and the Marine Simon Coveney TD At the end of 2013 there were 39 verified Origin Green members, representing over 50% of Irish food & drink exports 750 delegates attended Bord Bia’s inaugural global sustainability conference, ‘Our Food Our Future’ Bord Bia Irish Food Board Annual Report 2013 19 ambassadors through the UCD MSc. in Business Sustainability. The MSc. complements the suite of educational programmes already being supported by Bord Bia and, through placements in international food companies, beginning in 2014, its participants will foster dialogue on the evolution of the sustainability agenda, communicating the commitment of Irish food and drink manufacturers to Origin Green as they do so. In September 2013, Bord Bia hosted a major international conference in Dublin entitled ‘Our Food Our Future. Sustainability: The Bottom Line’. Bringing together global thought leaders to discuss enhancing the sustainability of the supply chain, the event was opened by An Taoiseach, Enda Kenny TD, and featured a line up of speakers that included representatives from the World Bank, the World Wildlife Fund, the Futures Company, Tesco, McDonald’s, Pepsico, Kerry Group and Mars. The event attracted 750 local and overseas delegates, including 280 senior food buyers and 36 international media representatives, from across five continents. In 2014, a further important development in sharing the message of Origin Green will be the investment of almost €3.5 million in a targeted marketing campaign to promote Ireland as a source of worldclass sustainably produced food and drink. • Quality Assurance Bord Bia operates quality assurance schemes (QAS) for beef, lamb, pork, poultry, egg and horticulture. QAS set out internationally accredited sets of standards that producers and processors agree to, and provide for audits to ensure that production is in accordance with these standards. Since 2011, carbon output measures have been measured as part of Bord Bia’s Beef & Lamb Quality Assurance Scheme (BLQAS) and, in August 2013, Bord Bia received confirmation from the Carbon Trust of certification for its latest system-wide carbon footprinting measurement and mitigation programme. The parallel development of the Teagasc-Bord Bia Farm Carbon 20 Bord Bia Irish Food Board Annual Report 2013 Carbon Navigator Tool launched to correlate actions at farm level with carbon outputs and cost savings Sustainable Dairy Assurance Scheme launched Navigator Tool, launched in 2013, makes it easier for farmers to correlate directly between their actions at farm level and the resulting carbon outputs and cost savings. In December 2013, the launch of the Bord Bia Sustainable Dairy Assurance Scheme (SDAS) marks another significant step forward – extending carbon emission monitoring to the entire dairy industry, effectively in one step. Fully accredited under ISO 17065, SDAS provides confirmation that Irish milk is being produced under internationally verified sustainability and quality assurance criteria. Once fully implemented, Ireland’s dairy producers will join BLQAS-accredited beef farmers in holding an enviable position – being the only producers in the world who are systematically measuring and improving their environmental performance at a national level. Plans to extend the measurement of carbon outputs to Ireland’s lamb, poultry, pigmeat and horticulture sectors were also progressed in 2013, with significant advances anticipated in 2014. • Equine DNA issue Dairy exports to non-EU markets increased by 6% 31,386 Quality Assurance Scheme farm audits conducted during 2013 The emergence of the equine DNA issue in January 2013 had serious implications and consequences for food processors across Europe and threw a clear spotlight on the issues of traceability and trust in the food supply chain. As the issue was first identified in Ireland, the robust and transparent way in which it was addressed here proved decisive in the overall industry and consumer response and set the tone for the broader European approach. Consumers recognised the issue was a category rather than a country of origin one and food industry buyers, particularly those in the segments impacted, responded with a renewed focus on traceability. The impact for quality assurance programmes has, therefore, been largely positive. In the course of the year, Bord Bia’s Beef and Lamb Quality Assurance Scheme (BLQAS) increased its membership to 41,065, an increase of 22% on the previous year. Today, an estimated 87% of all beef produced on Irish farms is quality assured, alongside 65% of all lamb. In the poultry, pigmeat and eggs sector, almost all production is now quality assured, while, for horticulture, the figure is approximately 75%. • Trade events and exhibitions Trade events and exhibitions continue to represent an important platform for Irish companies as they engage with buyers and prospective customers. Following the successful launch of Origin Green at the SIAL trade fair in Paris in 2012, trade events throughout 2013 provided a further opportunity to extend and build on its message, with Origin Green branding prominent on all Bord Bia stands and exhibition areas. • Sustainable Agriculture Initiative The Sustainable Agriculture Initiative (SAI) Platform was established by a number of major international food industry players some 10 years ago and, today, has more than 50 members. As a member for the last three years, Bord Bia has contributed significantly to the debate within SAI on greenhouse gas emission allocations in beef and dairy production and, in 2013, Bord Bia hosted a joint meeting of the SAI and the Global Research Alliance on agricultural greenhouse gases. The event was attended by scientists from New Zealand, Australia, The Netherlands and Ireland, as well as SAI members from leading food manufacturers. • Bocuse d’Or In 2013, Irish beef was selected as a key ingredient by the organisers of the prestigious French culinary competition, Bocuse d’Or, which took place in Lyon during the world hospitality and food service trade show Sirha. Securing this accolade proved a valuable endorsement for Irish beef and followed a rigorous and lengthy process by the competition’s International Organisation Committee. The use of Irish beef earned widespread coverage and positive commentary in many key markets, particularly Belgium and France. • Chefs’ Irish Beef Club In June, Bord Bia hosted an international assembly of members of the Chefs’ Irish Beef Club in Ireland. Over 60 member chefs and media from 13 international markets participated in a three-day itinerary, which included farm and factory visits. President of Ireland Michael D. Higgins hosted a reception in Áras an Uachtaráin to formally recognise the contribution of the Chefs’ Irish Beef Club to building the reputation of Irish beef within our key export markets. 87% of beef and 65% of lamb in Ireland is quality assured Over 850,000 visitors attended international trade shows where Bord Bia exhibited Bord Bia Irish Food Board Annual Report 2013 21 40 Inward seafood buyer visits took place from markets outside Ireland’s core EU markets 73% of graduates from Bord Bia’s Fellowship Programme are employed within the food & drink industry • Inward visits and media • Pathways for Growth Bord Bia was involved in a number of events held as part of the Irish hosting of the EU Presidency during the first half of 2013. These included a lunch for 62 EU media journalists at the start of the year and a three-day itinerary for an inward visit of Ministers and officials as the presidency drew to a close. Bord Bia also advised on the catering at all venues through the OPW. At the Global Irish Economic Forum later in the year, Bord Bia provided advice on the hospitality and catering element of the event. Building on Food Harvest 2020, the Department of Agriculture, Food and the Marine’s roadmap for development of the sector, Pathways for Growth is a five-year multi-disciplinary programme designed to support Ireland becoming one of the most efficient and innovative food, drink and horticulture producers in the world. While Origin Green (covered under Strategic Priority 1: Building Ireland’s Reputation) is the highest profile output from the programme to date, Pathway’s four other workstreams – co-opetition, innovation and NPD, education and entrepreneurship – continued to prove extremely significant in driving an agenda of change and growth in 2013. International media visits form an ongoing part of Bord Bia’s communications activities and various high-profile events throughout the year created opportunities to host media professionals from the UK, France, Scandinavia, the Netherlands, Spain, Russia, China, United Arab Emirates and Japan, among others. Noteworthy coverage secured for the industry included a CNN news feature on Ireland in December that focused on the growth and resurgence of agri-food business and Chinese media coverage of the National Ploughing Championships. Strategic Priority 2: Enhancing Competitiveness 11 businesses graduated from the Food Works entrepreneurial programme 22 Bord Bia Irish Food Board Annual Report 2013 Promote industry’s market competitiveness by championing an integrated approach, leveraging existing strengths and exploiting synergies across sectors and firms; supporting innovation; and building capabilities where necessary. The Irish food, drink and horticulture industry competes successfully in some of the most competitive markets in the world thanks to a focus on innovation, lean manufacturing and capacity building. Bord Bia engages in a number of programmes that support the industry as it enhances its competitiveness. •Education Attracting and retaining the next generation of business talent in the food and drink industry is integral to Bord Bia’s multi-tiered education programme. Feedback in 2013 showed the centrepiece Fellowship programme recorded the highest ever retention levels and the greatest potential sales value in 2012/13. Of the 25 fellows who participated in the 2012/13 programme, 17 have been employed within Irish food and drink. A sales value of over €30 million was recorded by the end of the programme. 2013 also saw the launch of the Origin Green Ambassadors Programme (see Strategic Priority 1: Building Ireland’s Reputation) while the Food Export Graduate Programme, run in conjunction with IBEC, continues to offer graduates a unique opportunity to enter the food industry with a placement involving an Irish company focused on overseas growth. Finally, the two-year Food Industry Strategic Growth (Alumni) programme, which supports more experienced professionals underwent a review in 2013 and will be restructured in 2014 to run over a concentrated nine-month period. •Entrepreneurship The launch of Food Works in 2012 was a collaborative endeavour involving Bord Bia, Teagasc and Enterprise Ireland, and was designed to facilitate business start-ups with the potential for growth of scale. In 2013, eleven Irish food entrepreneurial businesses graduated from the first Food Works programme and three secured Enterprise Ireland High Potential Start-Up funding almost immediately. In March 2013, Food Works 2 was launched, incorporating a number of learnings from the first programme. Bord Bia would like to thank the many companies within the food industry, the Institute of Advertising Practitioners in Ireland (IAPI) and retailers Tesco and Musgraves for the invaluable support and feedback provided throughout the Food Works programme. •Innovation Bord Bia’s Consumer Insight and Innovation team worked across the food, drink and horticulture industry in 2013 to foster consumer-led innovation. A record number of individual projects were undertaken through foresight4food, Bord Bia’s consumer insight and innovation programme, while the Consumer Lifestyle Trends programme attracted over 50 companies in its ongoing presentations and workshops. Seven macro consumer insight and foresight studies were commissioned to identify changes in consumer behaviour while, in November 2012, the Branding and Insight & Innovation Workbooks were launched. Collectively, the outputs from Bord Bia’s Consumer Insight and Innovation team have helped facilitate Irish companies engaging in the innovation and NPD process, encouraging them to plan their actions around longerterm holistic views of consumer needs and wants. This culture of innovation and enquiry received due recognition when Bord Bia was awarded the qualitative research excellence award by the Marketing Society in 2013 for the ethnographic research it had undertaken for Glanbia in Senegal. • Marketing Assistance Programme The Marketing Assistance Programme (MAP) represents an important opportunity for smaller companies (with an annual turnover of between €100,000 and €3.5 million) to secure funding for marketing and communications projects. In 2013, a total of 203 applications were received and grants totalling €850,639 were paid to 155 companies. Those who benefitted included companies operating in the farmhouse cheese, beverages, chilled dairy, confectionery, bakery, prepared meals, charcuterie, seafood and horticulture sectors. Bord Bia receive research excellence award • Food and drink industry awards The achievements of Irish food, drink and horticulture companies were recognised at the 2013 Bord Bia Food and Drink Awards held at the Royal Hospital Kilmainham, Dublin. The awards, which take place every two years, recognise excellence across the industry and the 2013 award winners were: • Export award - Glenmar Shellfish; •Innovation award - Paganini for FitFuel, a protein enriched ice cream range; 155 companies received grants totalling G850,639 •Success at home award - Britvic Ireland for MiWadi; •Sustainability award - Dawn Meats; • Branding award - Keelings; •Entrepreneurial award - Irish Atlantic Salt; and, •Consumer insight award - Kerry Foods for Cheestrings. Bord Bia Irish Food Board Annual Report 2013 23 Overseas offices held 890 buyer meetings & presentations 56 companies participated with Bord Bia in trade missions to emerging markets A new award for ‘online champion’, recognising companies responding to the digital age went to James Whelan Butchers, while ABP Ireland was honoured with the inaugural business referral award, in recognition of its support for co-opetition. •Co-opetition Co-opetition is strategic cooperation with competitors or other peers in the food industry, whether to increase market scope, share the cost of marketing or address logistical overheads. Awareness of the opportunity it presents has grown from a standing start in 2010 and Bord Bia research in 2013 showed that 75% of Irish food, drink and horticulture companies seeking marketing support from Bord Bia have considered co-opetition in their business planning. Since 2010, some 28 individual projects, involving over 200 Irish food, drink and horticulture companies have been initiated in the area of promotion, procurement, market access/trade, logistics and mentoring. Notable activities include the opening of Bord Bia’s China Hub in Shanghai and gaining EU and industry funding for promotional activity with mushrooms and farmhouse cheese. Strategic Priority 3: Building Exports 98 discreet insight projects were completed by Bord Bia’s Insights & Innovation team for 49 companies 24 Bord Bia Irish Food Board Annual Report 2013 Strengthen and extend the ability of Irish food and drink companies, driven through market insight, to build profitable share in selected high-potential export markets. The broad spread of growth among Irish food and drink exports was a welcome feature of trade in 2013, with a balanced performance seen by Irish exporters in the UK, continental EU and international markets. Throughout the year, Bord Bia worked with Irish food and drink businesses in both established and emerging markets to provide market intelligence, strategic introductions and marketing campaigns that could assist in export growth. • Overseas’ reach With the opening of an office in Dubai in 2014 Bord Bia’s network of 11 international offices will stretch from New York to Shanghai and centre on the markets where trade and the future opportunities for growth are greatest. In addition to responding to market information requests our overseas offices undertook 890 buyer meetings and presentations. Thanks to the generous patronage of the President of Ireland, An Taoiseach and the Minister for Agriculture, Food and the Marine, the industry is also afforded many opportunities annually to foster trade links on the international stage through state visits, diplomatic initiatives and trade missions. Bord Bia works closely with the Department of Foreign Affairs and Trade and the Department of Agriculture, Food and the Marine to extend market access for Irish food exporters where clear trading opportunities are recognised. In 2013, there were a number of positive developments to report, including the lifting of restrictions on trade to Japan and the finalisation of protocols that will see Irish beef and lamb being exported to the US. In a move designed to support industry plans to double exports to the Middle East by the end of this decade, Bord Bia announced plans to open an office in Dubai. On the occasion of President Michael D. Higgins’ three-day state visit to Italy in February, Bord Bia, in conjunction with other Irish state agencies, hosted a business lunch in the Irish Embassy in Rome. President Higgins also attended a business lunch in Paris in February, to which Bord Bia invited a targeted group of industry figures. In December, An Taoiseach, Enda Kenny TD led a trade mission to Japan where the food and drink industry was represented, among other sectors, in a trade programme that ran alongside the official visit. Minister for Agriculture, Food and the Marine, Simon Coveney TD also led trade missions over the year, including a visit to Switzerland in July and to the Middle East in December. The latter visit, taking in Saudi Arabia and the United Arab Emirates, involved almost 60 representatives from the Irish food industry. • Promotional campaigns In recent years, Bord Bia has worked in close collaboration with the food marketing agencies of other Member States to secure EU funding for a range of cross-border promotional initiatives. Of note in 2013 was the launch of the ‘Discover Farmhouse Cheese’ programme, a new EU cofunded programme that promotes farmhouse cheese in Ireland, Germany and the Netherlands. The programme is targeted at women of all ages, adolescents, girls aged 8 to 13 and elderly people. The horticulture sector, meanwhile, benefitted further from the launch of the EU-funded ‘Just Add Mushrooms’ campaign which, following on from a previous threeyear campaign, focuses on 25-45 year olds in the target markets of Ireland and the UK. The EU contribution to the campaign is €1.36 million, 50% of the total budget of €2.72 million. Notable among Bord Bia’s own overseas marketing campaigns this year was the ‘Honest by Nature’ campaign in the Netherlands, a multi-platform campaign designed to communicate the quality, animal welfare and sustainability credentials of Irish beef. • Market research Bord Bia hosted a European Private Label Conference in Dublin in March, from where it launched its new Continental Europe Private Label Programme, designed to facilitate access to retailers over a three-year period. A new seafood directory for the Russian and select markets in the Middle East provided profiles of the leading importers, distributors, agents and logistics providers in the region. A workshop on the Russian seafood market followed the launch of the directory. Research on behalf of the seafood sector in Germany, Austria and Switzerland was undertaken to assess trade interest in Irish organic sea trout, the only certified organic sea trout in Europe. Meanwhile, the opportunity for dairy exports to Kenya, Tanzania, Uganda, Zambia and Mozambique – six countries with a combined market of 170 million consumers – was explored in response to growing interest but limited experience of the Irish dairy industry in this region of Africa. A research project on the future of whiskey saw Bord Bia identify new and emerging trends in the UK, USA, Russia and Japan, and the opportunities these present to Irish distilleries over the next two to five years. A report on the crisp and snack market in the UK, undertaken for Bord Bia, outlined the opportunity gaps in the market presented for Irish companies. Over 20 new listings were generated for Seafood in markets other than the UK, France, Germany and Spain. • Ploughing Championships Bord Bia participated in the National Ploughing Championships in September in Ratheniska, Co. Laois with a market information stand and Origin Green dome in the main area. In conjunction with the Irish Farmers Journal, Bord Bia hosted livestock demonstrations throughout the three days of the show, while a range of Quality Assured Irish meat dishes were served from The Country Kitchen. Strategic Priority 4: A vibrant home market Support and progress the strong position that the agri-food sector currently occupies within the broader Irish economy. 208,884 live cattle exported The home market is of central importance to Irish food, drink and horticulture producers and, in 2013, Bord Bia focused on activities that strengthened the message of the quality proposition Irish food and drink products represent. Bord Bia Irish Food Board Annual Report 2013 25 Bloom attracted 110,000 visitors for the first time •Bloom • Media and advertising Bloom 2013 was the seventh year of the show and Ireland’s biggest gardening and horticulture event took place over five days from 30th May to 3rd June in the Phoenix Park, Dublin. In all, 110,000 visitors attended and feedback was, in keeping with recent years, extremely positive. Research shows that some 60% of the adult Irish population is aware of the event and up to 30% of those impacted were inspired to engage in some gardening activity as a result. The 2013 show saw a number of new features as the event was dubbed ‘the Gathering of gardeners’ in keeping with the Fáilte Ireland Gathering theme of the year. The Bord Bia sponsored RTE 1 ‘Home Chef’ series featured Neven Maguire and a host of other guest chefs using quality assured ingredients in their kitchens and was aired over thirteen episodes from February to May, 2013. A Christmas episode also aired. An intensive campaign of TV advertising, run in February and again in October, focused on the Quality Mark and research found that 85% of all adults agreed that the advert was effective in encouraging them to buy food with the Bord Bia Quality Mark. Promotional campaigns were also undertaken for eggs, lamb and poultry. The lamb campaign targeted higher income female shoppers aged 40-55 years and a follow up survey found overall 67% of adults said that the TV advert would encourage them to buy more lamb with the Quality Mark. In addition to the show gardens and the gardening displays, important features of Bloom 2013 included the Bloom Inn, which offered local artisan beers, whiskey and spirits; the food market, where visitors could enjoy an unparalleled array of Irish artisan foods; the Bloom farmyard, jointly organised by Bord Bia and Agri Aware and several interactive features that helped explain Bord Bia’s Origin Green programme. Gardening talks and cooking demonstrations also featured, the latter promoting cooking with quality assured ingredients. In view of the ongoing high visitor numbers, a number of proposals are under active consideration to create the best possible experience for visitors to the show in 2014. The inaugural Bord Bia Christmas Food Market, meanwhile, took place at chq Building, IFSC, Docklands, Dublin in December, providing 40 participating companies with an opportunity to sell their products to a wide consumer audience in a unique atmosphere. 26 Bord Bia Irish Food Board Annual Report 2013 The establishment of the Bord Bia Quality Kitchen has created an online resource that allows featured ambassadors to share their recipe ideas and kitchen tips, while promoting food with the Quality Mark. The ambassadors include TV and radio presenters Hector Ó hEochagáin and Aoibhinn Ní Shúilleabháin, ex-Ireland rugby international David Wallace and VIP columnist and former model Yvonne Keating, along with celebrity chefs Neven Maguire and Donal Skehan. The Quality Kitchen launched in March and, within a few months, the number of Bord Bia Facebook fans had increased from 10,000 to over 45,000. • Food Academy Food Academy Start is a new training programme launched in September 2013 which aims to support and nurture start-up food businesses. Bord Bia, SuperValu and the County Enterprise Boards joined forces on the initiative designed to provide a consistent level of food marketing knowledge to new and early-stage food business owners. Businesses that complete the initial programme can then progress to the advanced phase. • Food Dudes The national roll out of the Food Dudes Programme, which has the objective of encouraging national school children to consume more fruit and vegetables, commenced in 2007 and will be completed during 2014. Evaluations of the programme show a positive impact in terms of long-term and sustained increases in consumption of fresh produce by participants. A follow on to the Foods Dudes Programme called ‘Food Dudes Next Generation’ was piloted in 84 schools during 2013. •GLAS Bord Bia was the main sponsor of the one-day GLAS amenity horticulture trade show, held at the Citywest Conference Centre in July. Visitor numbers surpassed 1,000 and 97% of visitors rated their attendance as ‘worthwhile’. • TASTE Council Bord Bia in association with the TASTE Council hosted the 2013 Summer School at the Grain Store, Ballymaloe, Co. Cork in May. The theme of this year’s Summer School was education and the TASTE Council launched a module for transition year students designed to introduce students to the food industry in Ireland. The module was piloted in six secondary schools in September 2013 with a view to rolling it out to all schools in 2014. Over 419,000 Food Academy was launched during 2013 to support new and early-stage food business owners • Organic sector / farmers’ markets Research on the Irish multiple retail sector’s perceptions and issues in the supply of Irish organic food identified a number of limiting factors hampering growth in the sector, and following a presentation of these findings, it was agreed to break from the consumer campaigns around National Organic Week and the National Organic Awards until the Irish organic industry is positioned to take full advantage of these promotions. Meanwhile, research on the development of farmers’ markets highlighted the importance of location, frequency, range and consistency of supply in successful farmers’ markets. Bord Bia is currently developing a blueprint for recruiting the second generation of farmers’ markets and their members and consumers. •Foodservice A food service seminar in Dublin saw the launch of a Bord Bia report on the Irish foodservice industry, currently valued at over €6 billion at consumer prices. The report suggested growth in the market would be contingent on revitalising the dining out experience while maintaining the sense of the familiar. children have participated in Food Dudes since it commenced in 2007. Conclusion The sheer diversity of Ireland’s food and drink portfolio has long been one of its strengths and, in 2013, the industry once again put in strong performances across all categories. The two pillars of Irish agricultural output, meat and dairy, continued to lead the way with respect to the scale of growth achieved. In a year where many forecasters had expected consolidation rather than significant expansion, the scale of the growth achieved was laudable and Bord Bia, I believe, was instrumental in facilitating this onward journey. The powerful commitment to sustainability evidenced in 2013 has also provided a new and exciting platform for the industry to speak with a common voice and Bord Bia is committed to enhancing the opportunities for growth this represents in the years ahead. As a marketing support agency, Bord Bia strives in everything it does to promote growth that creates wealth and employment in the real economy. We take great pride in the part we play in facilitating the growth strategies of our clients. In concluding my review of the year, may I thank the Minister for Agriculture, Food and the Marine, Simon Coveney TD, the Chairman of Bord Bia Michael Carey and the members of the Board and the subsidiary boards most sincerely for their unwavering commitment and support during 2013. Bord Bia could not hope to serve the industry as it does without the guidance and invaluable expertise of individuals of this calibre. I would also like to acknowledge and sincerely thank my colleagues in Bord Bia who, through their expertise and insight, foster relationships of value throughout the industry, and contribute fundamentally to the outputs of what I believe is a world-class organisation. The opportunity to reflect on the accomplishments of a year gone by is quickly curtailed by the demands of the year ahead. However, I believe we can look on 2013 as a year where many valuable lessons were learned and where the commitment of the Irish food, drink and horticulture industry to the path of progress and growth proved unerring. While we cannot doubt that challenges lie ahead, we can take the many positive soundings around economic recovery in Ireland and beyond, along with the continued strong performance of our industry, as clear reasons to be optimistic for the year ahead. Aidan Cotter Chief Executive Bord Bia Irish Food Board Annual Report 2013 27 Sector Review: Meat and Livestock Beef A combination of strengthening commodity prices and higher output contributed to the beef industry putting in a very strong performance during 2013. Beef Exports 2012 €1.9 billion 2013 +10% €2.09 billion Production 520,000 tonnes Exporter 470,000 tonnes % Exported 90% With beef exports valued at just under €2.1 billion, the UK absorbed over half (53%) of this, a year-on-year increase of some 5%. Continental Europe saw more marginal growth, up €60 million to €960 million, with Scandinavia, France, Germany and the Netherlands offering the best returns. At a macro level, Irish suppliers benefitted from a general fall of 2% in European beef output although exports to the Continent faced some price resistance during the year in response to slow consumer demand and relatively high beef prices. The international marketplace was worth some €25 million to the sector in total, with trade to Switzerland, Russia and some African countries noteworthy. A new campaign entitled “Honest by Nature”, designed to promote Irish grass fed beef in the Netherlands, was launched during the year to communicate to consumers and buyers on the quality, animal welfare and sustainability credentials of Irish grass fed beef. The positioning of Irish beef in our key markets continues to progress, with almost two thirds of export volumes now destined for the higher value standard retail, premium foodservice and retail or quick service sectors. Contributing to its image as a premium quality product, Irish beef was selected as the key meat ingredient for the 2013 Bocuse d’Or, the international culinary competition widely regarded as the ‘Olympics 28 Bord Bia Irish Food Board Annual Report 2013 of the Culinary World’. Over sixty member chefs and media from thirteen international markets travelled on a three day itinerary which included farm and factory visits. On the occasion of their visit to Ireland, President Higgins hosted a reception in Áras an Uachtaráin to formally recognise their contribution to building the reputation of Irish beef within our key export markets. Livestock exports Livestock Exports An important feature in the livestock trade during 2013 was the resumption in exports to Libya. Shipments to the market included almost 15,000 cattle along with 21,000 sheep. Other North African markets included Tunisia, 4,000 head, and Morocco, 1,300 head. Trade in live sheep exports remained strong throughout the year and the commencement of live trade to Libya providing an added boost to the sector. Live pig shipments to Northern Ireland had an estimated value of €72 million. Pigmeat 2012 €217 million 2013 +11% €240 million Live Cattle +30% 210,000 head or €157 million Calves +140% 90,700 head Weanlings & Stores +3% 70,500 head Finished Cattle -10% 48,000 head Sheep +55% 70,000 head Pigmeat Exports Pigs -6% 571,000 head 2012 €510 million 2013 +9% €557 million Competitive domestic calf prices and a recovery in live exports to North Africa were the two main drivers of a stronger live export trade during 2013. Calf exports to Belgium increased by 135%, to the Netherlands by 110% and exports to France resumed reaching almost 7,000 head. Exports to Spain also increased by 140% mainly due to increased calf exports. Weanling exports to Italy fell by 32% and consignments to Northern Ireland were also 13% lower. However, exports of weanlings and store cattle to many of our traditional markets continued to be impacted by the relatively high prices being paid for stock by domestic beef producers. During most of 2013, farmers in Ireland received higher prices for finished cattle than in the majority of other EU producing countries. Ireland’s pigmeat producers are long familiar with competitive and price sensitive environments. During 2013, some respite from this picture emerged, as prices increased by approximately 6%, a situation that offset a 2% drop in production and brought about a timely boost to the value of Irish pigmeat exports. Growth came in the context of lower EU pigmeat production and strengthening international demand. Reduced trade to Japan and Continental Europe contrasted to strong growth in the UK where the value of trade rose by 6% to €320 million. Exports to international markets were up 7% on last year, valued at an estimated €125 million. Growth was particularly in evidence in Russia, while China and the US saw steady demand and the Australian market reopened to exporters. With half of Irish pigmeat production destined for the home market, the promotional focus during 2013 revolved around continuing to maximise demand for Quality Assured pork, bacon, cooked ham and sausages amongst Irish consumers. The use of the Bord Bia Quality Mark on Pigmeat products (Bacon, Pork, Rashers and Cooked Ham) as tracked in the Bord Bia quarterly retail audit reached 68% in 2013, its highest level since the retail audit started in 2008. Since the Quality Assured Bacon and Ham TV advertising campaign started in 2012, advertising awareness of this campaign has risen from 51% to 70% of all adults by the end of 2013. This campaign was supported with TV, point of sale, PR and social media activities. Poultry An easing in feed costs as the year progressed combined with stable consumer demand helped the poultry sector across Europe during 2013, although prices came under some pressure as the year progressed. EU poultry production increased by around 1% in 2013 to 12.8 million tonnes. This increase was driven entirely by broiler production as both turkey and duck recorded lower output levels. Irish poultry production fell by 12% on the back of some structural changes within the industry during the year. Lamb Poultry Exports 2012 €223 million 2013 +5% €234 million Broiler prices across Europe were almost 3% higher in 2013 at €1.95/ kg. The value of trade to the United Kingdom, at €190 million or some 83% of total exports, was largely unchanged during 2013 as stronger exports of processed poultry helped offset lower fresh and frozen volumes. Exports to other European markets, estimated at €30 million, performed well in value terms and were led by France which saw a sharp rise in exports of frozen product. Trade to international markets, valued at €13 million, showed little change with stable exports reported to South Africa and the rest of Africa. Total sheep meat disposals increased by 184,000 to reach 2.61 million head during 2013. Lamb Exports 2012 €218 million 2013 +4% €226 million The 8% increase in throughputs levels was a result of a higher carry over and disposal of hoggets which were up by almost 165,000 head on the previous year. However, gains achieved by the increase in throughput levels were negated by a difficult spring when carcase weights were back by an average of 1.3kgs resulting in total sheep meat production rising by just 3% to reach 55,000 tonnes. Domestic consumption remained under pressure and according to Kantar Worldpanel retail sales of lamb fell by approximately 6%. For the year, total sheep meat consumption is estimated at 15,200 tonnes, equivalent to 3.5kg per capita. Total sheep meat exports increased by 5% to reach 44,000 Bord Bia Irish Food Board Annual Report 2013 29 tonnes with values rising at a similar rate to reach €226 million. While France and the UK continue to be our core markets their share of exports fell from 70% to less than 60% in 2013 reflecting a significant drop in trade to the UK. Market diversification continues to be a growing trend, especially to the high value markets such as Belgium, Germany, Sweden and Switzerland. Emerging International markets are growing in importance with Hong Kong being the primary destination of Irish sheep meat exports with shipments doubling to almost 1,200 tonnes. In light of the growing importance of Irish sheep exports into Belgium and Sweden, both of which grew by 50% and 30% respectively an integrated programme of promotional activities was undertaken at trade and consumer level. 30 Bord Bia Irish Food Board Annual Report 2013 Home market promotions focused on increasing the frequency of lamb purchases during the peak supply season and a successive wave of promotional activities coinciding with the availability of new season lamb included a total of eight weeks of TV advertising, PR publicity and social media activities. The Bord Bia Quality Assurance logo is growing in importance with 95% of all lamb facings in Irish retail now carrying the quality mark and applications for membership of lamb quality assurance surged to almost 12,000 equivalent to 65% of national throughput The ‘Agneau Presto’ campaign which is a collaborative initiative between Bord Bia and our counterparts in the UK and France has made significant inroads in changing consumer attitudes to lamb in France. With a central theme of convenience, the campaign placed a significant emphasis on training butchers in both lamb processing plants and retail stores to develop and sell the new range of cuts, as well improving merchandising displays. The decision of the EU Commission during the year to allow sheepmeat to be an eligible product for the EU Promotion of Agricultural Products programme was welcomed and will build on the collaborative work of the Agneau Presto campaign facilitating the generic promotion of lamb across a number of EU markets. Market Access Gaining market access has been a priority and the subject of intensive work in recent years. Significant progress has been made with the recent good news announcing the lifting of restrictions on trade to Japan and the finalisation of protocols that will see Irish beef and lamb being exported to the US. Sector Review: Food and Beverages Dairy products & ingredients Exports 2012 €2,636 million 2013 +14% €2,995 million One of the pillars of the Irish agri-food sector, the dairy category is a broad one, encompassing primary and value added products and ingredients. Poor weather in key production areas globally led to some severe supply challenges in 2013, while demand remained strong in a number of a markets including China, the world’s largest dairy buyer. The UK, accounting for 37% of dairy exports, remains the single most important market for the sector and exports increased by 15% to €1.1 billion for the first time. Even more vigorous growth was experienced in the euro zone, where trade increased by more than 25% to account for 29% of total dairy exports with the strongest increases in exports to Belgium, France, Germany, the Netherlands and Italy. The picture internationally was more mixed, with strong performances in China, Hong Kong, Malaysia and Vietnam offset by lower trade in the US, Saudi Arabia and South Africa, bringing the total value of the international markets down to 34% from 38% in 2012. Looking closely at the dairy categories, the traditionally strong butter and cheese exports recorded strong overall performances. Butter exports experienced a 10% increase in volumes and higher average prices with exports to Continental Europe increasing by over 50% boosted by significant volume increases to Belgium, France and Germany. Cheese exports, which account for almost a quarter of dairy exports, increased by 7% on the back of strengthening demand. Categories such as infant formula also put in strong performances in markets such as China, Hong Kong and Vietnam, though the overall picture was relatively static. Prepared Foods The prepared foods category includes a wide range of primary products that have been further processed, such as ready-to-eat foods, mainmeal centres, some added-value dairy products, snacks, confectionery and bakery products. Arguably the most diverse of industry categories, prepared food exports enjoyed a strong overall performance in 2013, although one that masked more mixed results in some segments. Strongest performances were in fat filled milk powders, which grew strongly on the strength of global demand, while established categories such as frozen ready meals faced a range of challenges including the consumer response to the equine DNA issue, a more competitive marketplace, higher costs and changing consumer trends. Cooked meats, pizza, sauces, bakery and, to some extent, confectionery recorded more positive performances. On the domestic market, manufacturers experienced continued input cost increases and margin pressures. Price inflation saw consumers cope by switching to discount retailers and to private label ranges. Overall the Irish grocery retail market declined by 0.3% in 2013, although this was the slowest rate of decline since 2009. Many companies are expanding their trading platform across a range of retail models and export markets as well as introducing innovation strategies into their businesses as a means to add value and differentiate their product offer from competitors. The UK continues to be the main target market, accounting for almost 40% of prepared food exports. While the relative strength of the euro against sterling created some issues, strong showing in foodservice and a focus on NPD, which delivered new streams of business, were notable aspects of the year’s performance. During 2013, the trend of diversification also began to intensify, with operators diverting supply to continental European markets and to some niche opportunities in international markets. Continental EU markets now account for more than a quarter of total prepared food exports and overall trade for the year increased by around 20% to reach €420 million. The Netherlands, France, Germany and Scandinavia were the best performing markets. Bakery During 2013, the domestic market for bakery remained stable with recent changes in the structure of the retail environment generating opportunities for suppliers to develop new products and branded routes to market. Exports of bakery products grew strongly in 2013. In the key UK export market, instore investment in bakery in the main retailers is a key driver with growth in artisanal and speciality breads, freefrom products, self-treating indulgent cakes and seasonal ranges. Although the UK remains the most important market for this sector, there has been a steady increase in the number of markets served with several companies now growing sales in the Middle East, North American and Australian markets. Opportunities are also being explored in other new markets with niche suppliers in the category presenting particularly good potential. The outlook for Irish bakery exports is positive, with high levels of investment in facilities and production reflecting a dynamic market. While input costs have eased managing the commodity markets remains challenging. Confectionery Consumers continue to view chocolate as an affordable treat and following a decline of 2% in the previous year, chocolate confectionery exports grew by over 3%. While sales of mainstream chocolate to the UK declined, sales grew strongly to a number of new markets, such as the Middle East, Southern Asia and Australia driven principally by smaller producers. The Bord Bia Irish Food Board Annual Report 2013 31 launch of new products has also driven some of the growth especially in the luxury end of the market. Sugar confectionery exports had a good year with sales growing over 5%, the European markets grew strongly as did the UK with emerging markets such as the Middle East at the core of this growth. Frozen The frozen food category has been relatively buoyant with Kantar reporting the UK overall sector performance up 2.5% year-on-year to 5th January 2014 (while domestic performance for the same period was down 3.1%). This has been good news for many Irish frozen food manufacturers for whom the UK is the principal export market. The strong export performance has not been true of all product categories however with frozen ready meals in particular struggling more than ever due to the negative impact of the equine DNA issue in early 2013. Frozen burger sales also suffered as a result, though the potential negative impact was lessened somewhat by strong barbeque trade 32 Bord Bia Irish Food Board Annual Report 2013 thanks to exceptional weather during the summer months. Frozen pizza exports have shown a reasonably strong performance while ice-cream exports were very strong in 2013, thanks largely to the good summer. occasions with growing interest in health and wellness driving new product development. Companies are also successfully exploring new market opportunities in the Middle East, South Korea and USA. Grocery Artisan and Speciality Foods Driven by chocolate spread, peanut butter and honey, the grocery sector performed well during 2013 despite the challenges of volatile ingredient and input costs combined with increased operating expenses. The value of exports of sauces, soups, cereals and extracts increased by 14% with the value of sweet spreads exports growing by 5%. Volatile sugar prices and increased breakfasting at home have benefited the value growth in the sweet spreads category. The growing penetration of private label in supermarkets and discounters with consumers seeking out value for money also contributed to value and volume growth. Artisan and speciality foods are encompassed within prepared foods but can be seen as a distinct subset, given their important role in communicating the enduring cultural values around food production, and in highlighting the distinct value of foods that utilise traditional production methods and ingredients. Among a number of exciting developments for the sector during 2013 was the launch of ‘Discover Farmhouse Cheese’ programme, a new EU co-funded programme for the promotion of farmhouse cheese involving Ireland, Germany and the Netherlands. Activity within the category is focused on new varieties, low sugar and no sugar varieties, new packaging formats and increased consumption For prepared food suppliers generally, the potential to pass on increases and to recover margin will be a critical marker for the sector’s performance in 2014 and there is broad optimism that the upward trend of the last year will continue. Beverages The story of the global beverages market in 2013 was largely a contrast between strong growth in travel retail sales, where the increased impact of premiumisation is being felt, and sluggish consumer demand in developed economies and more mature markets. On the back of this, the beverage sector delivered what can be seen as a solid performance with sustained growth in whiskey and stronger exports of nonalcoholic beverages set against reduced trade in cider, beer and cream liqueurs. An overall marginal decline of 1% saw the sector’s exports worth €1.2 billion for 2013. The more challenging mature markets can, however, be contrasted with more impressive export growth recorded in emerging markets in Asia, Middle East, South America and Africa, all of which are increasingly seen as central to the future of the industry. Exports to the USA were helped considerably by a strong performance by Irish whiskey. From the supplier perspective, both spirits and craft beers will experience significant growth over the next 3 years. More than 30 craft breweries are currently operating on the island, while 19 more are in the planning phase. The number of distilleries on the island is increasing significantly also, with 12 more either in the planning or build phase. These, coupled with the existing portfolio of 21+ spirits distillers, cream liqueur manufacturers and brand owners will create a category with remarkable depth and breadth. Seafood Irish seafood exports recorded a slight decline during 2013 to an estimated sales value of €489 million. This was primarily due to a reduction in raw material availability. This followed strong growth of almost 65% in the value of exports over the period 2009 to 2012. The on-going strength of demand within the sector is evident by the continued rise in unit prices (around 7% higher), particularly for certain species such as salmon and oysters. The core European markets of France, Spain, Germany, Italy and the UK remain the main outlet for Irish seafood exports with the top five markets accounting for more than 55% of total exports. However, this compares to a 60% share in 2012 and demonstrates the on-going focus of the leading Irish seafood exporters in the development of new business in emerging markets to offset some price resistance in core European markets. The core European markets were challenged by a limited supply for traditional species such as salmon and whitefish and also by sluggish markets due to a poor economic climate and weak consumption. Seafood exports to International markets continue to grow strongly in 2013 reaching an estimated €175 million representing a value increase of around 7%. The strongest emerging markets with high double digit growth have been Cameroon, Russia, Korea, China and Hong Kong. Good performance for pelagic species in these countries partly explains strong growth but also a wider range of species into Korea, China and Hong Kong where crab, razors and oysters are beginning to make significant market entry at foodservice and retail level. Despite demand for organic salmon continuing to rise significantly, the lower availability of Irish salmon due to limited production was a key factor impacting seafood export volumes during 2013. Output was down by around 22% in volumes terms which had a major impact on salmon exports in all formats including smoked. Oyster exports performed well with strong demand both in traditional markets and emerging markets such as Hong Kong while Japan, Malaysia and the UAE all recorded very strong double digit growth in the value of exports albeit from a low base. The French market continues to dominate oyster exports with a value growth of 74% in 2013. The Italian market also performed well. Growers are holding onto oysters longer until they reach market size with a decrease in trading of half-grown oysters which explains volume as well as value increase of 18% and 53% respectively. Crab exports performed strongly in 2013 with an increase in value of around 14% against a background of stable volumes. A strong performance to China was recorded with an increase of 168% in value terms. The French, Italian and UK markets also performed well for this species. The total value of pelagic exports fell slightly in 2013 mainly as a result of the reduction in blue whiting available for processing and export. Total blue whiting export volumes reduced from 63,000 tonnes to 45,000 tonnes during 2013. The export performance of the Irish seafood industry in 2014 will be largely dependent on raw material supply for key product species. No major volume increases for aquaculture are anticipated for 2014 and quota restrictions on certain wild species, notably for prawns and whitefish, will hamper volume growth for the coming year. A resolution to the ongoing ‘mackerel war’ between the EU, Norway, the Faroes and Iceland, allowing large quantities of cheaper mackerel to flood the market, would be welcomed. With an Irish quota of 88,000 tonnes, boarfish represents a significant opportunity and Bord Bia is working to raise awareness of this product with a number of trade customers in the Chinese market. Bord Bia Irish Food Board Annual Report 2013 33 Sector Review: Small Business & Organic Sectors Bord Bia works with over 400 small food and drink businesses with a total estimated turnover of €400 million. Total direct employment by the small business sector is approximately 3,000 people. Small Business Open Day Themed ‘Progress and resilience in 2013’ some 170 small food and drink producers attended the Bord Bia Small Business Open Day on 23rd January 2013. This annual event which is designed to assist companies plan for the year ahead also featured presentations on Origin Green, latest Kantar research on the Irish and UK Retail landscape, Bord Bia insights into Understanding the Consumer and an in-depth interview with Michelin star chef Dylan McGrath. Vincent Reynolds, CEO of the Association of County Enterprise Boards presented on how the County Enterprise Boards support small business and Tara McCarthy of Bord Bia presented on the services and programmes provided by Bord Bia for small food and drink producers. The event also provided an opportunity to network with peers and showcased the full range of resources available to small businesses in the food and beverages sector from Bord Bia and related agencies. Bord Bia Vantage In 2007, Bord Bia launched Bord Bia Vantage, which services over 400 SMEs with a turnover of less than €3.5 million. Since its launch, the Vantage Programme has enabled owner/ managers to access best-practice resources, expertise and processes to help build their respective markets. The key service platforms of Bord Bia Vantage are: 34 Bord Bia Irish Food Board Annual Report 2013 Bord Bia Vantage Point – Vantage Point is Bord Bia’s online resource guide for small businesses. This is a focused internet space for small food and drink businesses at www.bordbiavantage.ie The aim of the website is to provide quick and easy access to timely and relevant information 24/7 and is divided into three areas; ‘starting your business’, ‘marketing your business’ and ‘insights for business’. Throughout the site, visitors are provided with overviews, top tips, guidelines, templates and other downloads. Vantage Point is a core part of the small business service and continues to be updated on a daily basis. Visitor number have increased to almost 47,000 visits, 40,000 of which were unique visits meaning that they are counted as an individual visitor no matter how many times they visit. Over the year, there were 80,500 page views. Bord Bia Vantage Plus – Vantage Plus is a programme designed to develop small business companies’ capabilities and competencies in the key areas of business and market development. Vantage Plus Programmes are underpinned by a group-based learning and networking philosophy which encourages best practice and co-opetition. In 2013, the Vantage Plus programme was paused to accommodate the launch of Food Academy Start (see also Chief Executive’s Review). Food Academy acts as a feeder to Vantage Plus as well as Bord Bia’s Retail and Foodservice Supplier Development Programmes. Food Academy was launched in September 2013 by Minister for Agriculture, Food and the Marine, Simon Coveney TD. The aim of the Academy is to provide integrated supports to food companies as they progress on their growth journey from start-up to national distribution and export. At entry level or Food Academy ‘Start’, the aim is to create a level playing field of food marketing knowledge across all counties and to deliver consistent information to companies as they begin their journey as a food producer. Rolled-out by the 35 County Enterprise Boards, the ‘Start’ programme is supported by Musgraves who nominate a SuperValu manager in each county to participate on the programme and provide retailer insights and expertise. Bord Bia has designed the full course content of ‘Start’. The second phase of Food Academy is the ‘Advance’ phase which is a partnership between Bord Bia and Musgraves and which will take the form of a new Bord Bia/SuperValu supplier development programme commencing in early 2014. The final phase of Food Academy is ‘Excel’ which encompasses the export development programme between Bord Bia and Budgens. Bord Bia Vantage Promote – Provides for business development and public relations activities; sponsorship of awards and the development of itineraries for the promotion of the small business and speciality sector. Trade Fairs Trade fairs continue to be an important source of new business (trade and consumer) for small business companies. Small businesses participated with Bord Bia at ISM Cologne, Biofach Nuremburg and the Speciality & Fine Food Fair in London. Bloom 2013 56 Irish artisan food producers participated in the Artisan Food Market at Bloom. The Artisan Food Market is an established feature in the Food Village at Bloom and provides a showcase for the finest Irish artisan foods including bakery, meat, fish, confectionery and prepared foods. The market stalls provide a unique opportunity for visitors to meet the producers and learn about the products on offer and how best to prepare them. Bord Bia Christmas Market Thirty three food companies participated in the inaugural Bord Bia Christmas Food Market at chq Building, IFSC, Docklands, Dublin from Thursday 12th December to Sunday 15th December. The Christmas Food Market was well attended by consumers over the four days with 2FM broadcasting live from the event on the opening day. Feedback from consumers and traders has been very positive and the market provided participating companies with an excellent opportunity to raise their profile and sell their products to a wide consumer audience in a festive and enjoyable atmosphere in the peak preChristmas trading period. Farmers’ Markets During 2013, Bord Bia undertook research into the current dynamic of farmers’ markets in Ireland against the back drop of Food Harvest 2020’s ambitions for farmers’ markets, namely their further development to provide opportunities for diversification and added value for smaller enterprises in particular. As part of the research, the role of the voluntary Code of Good Practice for Farmers’ Markets was also evaluated so that it may evolve into an enabler of best practice at markets to inter-connect the markets with the wider aspects of local food and to create a more sustainable local food eco-system for all. This will be developed further in 2014 as a central theme to Bord Bia’s planned Spring seminar on farmers’ markets. Organic Food 2013 was another challenging year for the organic market as consumers continued to be driven by price and promotional activity in their shopping choices. The total value of organic retail sales was €98 million, representing 1.4% of total food and drink retail sales in Ireland. This represents a fourth year of decline for the market from a high of €123 million in 2009. In early 2013 research was undertaken by Bord Bia to examine the Irish multiple retail sector’s current perceptions and issues in the supply of Irish organic food. In a series of 22 in-depth interviews, three limiting factors were identified to the progress of the sector; industry fragmentation, lack of industry commitment to adapt to consumer and retailer demands and the lack of ownership of an organic retail strategy by retailers or by industry. Following a presentation of these findings to Organic Focus, it was agreed by the group to focus on renewing and building the organic supply base in 2013 and to break from the consumer campaigns around National Organic Week and the National Organic Awards until the Irish organic industry is positioned to take full advantage of the promotion. In November 2013, Bord Bia presented the findings of a gap analysis research study on the Irish and UK markets to the National Organic Conference. The study identified potential new supply opportunities for the organic sector and development work around these opportunities will be carried forward into the 2014 organic marketing plan. Bord Bia Irish Food Board Annual Report 2013 35 Sector Review: Horticulture The key crops in the horticulture food sector include mushrooms, potatoes, field vegetables, outdoor fruit and protected crops. The key crops in the amenity horticulture sector include nursery stock production, protected flowers / ornamentals, Christmas trees, cut foliage and bulbs. The main market for the horticultural industry continues to be the domestic market. The main exports are mushrooms to the UK market and amenity sector exports including nursery stock plants, cut foliage and Christmas trees. Exports of mushrooms to France in small quantities began for the first time in 2013. The Irish retail market for mushrooms grew by 4%, in both value and volume in 2013. Potatoes The total production area for field vegetables is estimated to be in excess of 4,200 hectares with approximately 200 commercial field vegetable growers. Output from the sector was valued at €60 million in 2013. While the unusually cold spring delayed early season plantings and growth the warm summer weather resulted in good quality yielding crops. The domestic retail market is the key market for vegetables with the value of the fresh vegetable category valued at €521 million in 2013. The prepared fruit and vegetable category was valued at €84 million at retail level. It is estimated that 360,000 tonnes of potatoes were produced in Ireland during the 2013 season, with a total of 9,800 hectares of potatoes grown by an estimated 540 growers. The main variety grown in Ireland is Rooster accounting for 60% of production, followed by Kerr’s Pink 10%, Queens 7.5%, Golden Wonder 3%, Records 1% and others 19.5%. Recent years have seen a decline in fresh potato consumption with market switching over to other carbohydrate sources such as rice and pasta. While a significant majority of households still buy potatoes, on average they are tending to buy smaller pack sizes. The retail value of the potato category was €185 million in 2013. Mushrooms The mushroom sector experienced growth in 2013 with production exceeding 63,500 tonnes and the farm gate value estimated at €121 million. Ireland’s edible horticulture exports revolve chiefly around mushrooms, where a strong performance was again seen in 2013, with combined value and volume growth of 4% to the UK, the dominant export market for this sector. 36 Bord Bia Irish Food Board Annual Report 2013 Field Vegetables Protected Food Crops The protected salad/vegetable sector cropping area is approximately 162 hectares and has an output value estimated at €25 million. Tomatoes, peppers and lettuce are the major crops in this sector, most of which is destined for the Irish retail market. Irish tomato production has consolidated in recent years, but there have been some increases in the greenhouse area. Fruit Crops In 2013, output from the soft fruit and apple sectors was values at €41 million and €6 million respectively. Fruit is the largest fresh produce category for consumers at retail level valued at €530 million. Apples and strawberries are the two main fruit crops produced in Ireland. Demand for Irish eating apples remains strong and 2013 was a reasonable season for producers. The value of the retail market for Bramley apples increased marginally, even though volumes declined. Within the sector, there is increasing interest in cider production, and farm shops to increase the value of production. In the soft fruit market, strawberries are the most important crop and investment in the sector has extended the strawberry growing season from early April to the end of December. The retail value of strawberries grew by 1% in value, and 8% in volume. Soft fruits such as raspberries, blueberries, gooseberries and red currants continue to show growth, although their rate of growth is slowing. Berries apart from strawberries account for nearly 50% of the value of soft fruit sales. Amenity The amenity sector consists of crops such as hardy nursery stock, bedding plants, bulbs, cut flowers/ foliage and turf grass and a total output valued at in excess of €40 million. The domestic retail market for plant and flower sales is estimated to be in excess of €200 million per annum. Activity in the commercial landscaping sector continues to be challenged in the current environment but there are signs that activity is starting to increase again. Exports of amenity horticulture crops were valued at approximately €13.75 million in 2013 which is an increase of €2 million over 2012. This includes cut foliage used in floristry valued at €3 million, daffodil bulbs and cut daffodil flowers valued at €1.25 million, nursery stock (trees and shrubs) valued at €4 million and Christmas trees valued at €5.5 million. Most nursery stock sales were achieved in the UK. As in previous years small quantities of young garden plants (plugs and liners) were sold further afield where the higher value to volume ratio supported transport costs. The development of new plant varieties through micro propagation continues to generate additional export income through the licensing of intellectual property to foreign growers and the demand for novel plant introductions bought as both young and finished plants Horticulture Promotions Generic horticulture promotional activity in 2013 included National Strawberry Week in June and National Potato Day in August. National Potato Day activity was supported jointly by Bord Bia and the Potato Industry to encourage increased potato consumption and included a range of promotional activities which highlighted the health, convenience and versatility of the potato. For further information see www.potato. ie. The website continues to promote the potato to consumers as well as supporting other promotional activities. Agreement was reached with the potato industry to provide funding to support an application to the EU for matching funding for a three year generic promotion of potatoes on the Irish market. Fresh Produce was again promoted at Bloom 2013 through a major exhibit of fruit and vegetable crops, the best in season fresh produce market and a potato variety exhibit with cooking demonstration. The “Best in Season” website promotes crops in season detailing their nutritional content and how they can be used in recipes. Under the ‘It’s Garden Time’ banner, a gardening supplement was published in association with the Irish Independent in April, and two monthly features were supported in the Irish Garden magazine, featuring quality-awarded garden centres, landscaping businesses and nurseries. A suite of promotional material was commissioned and available to growers and retailers from the Bord Bia website. A promotion of locally grown plants through garden centres linked to Bloom was carried out during the summer. Bord Bia Irish Food Board Annual Report 2013 37 The third year of a three year EU supported mushroom campaign on the UK market continued in 2013. This campaign produced a cumulative increase in sales of 28,000 tonnes over the three years of the campaign. An application for funding for a follow on campaign, also for three years was successful and activity commenced in the last quarter of 2013. This campaign will also cover the domestic market. Food Dudes The national roll out of the Food Dudes Healthy Eating Programme continued in 2013 with another 386 schools and 67,000 children taking part. The Food Dudes Healthy Eating Programme is a whole school initiative which is based on the repeated tasting of fruit and vegetables. The programme is focused specifically on consumption and getting children to change their existing behaviour to either start or increase their consumption of fresh produce. The national roll out of the programme commenced in 2007 and 87% of schools have participated to date. Evaluations to date have shown a significant increase in the consumption of fresh produce by the children who have participated in the programme. The programme is funded by the Department of Agriculture, Food and the Marine and the European School Fruit Scheme. ‘Incredible Edibles’ schools programme is managed by Agri Aware and jointly funded by Bord Bia and the fresh produce industry. The programme was taken up by 875 national schools in 2013 and teaches children how to grow fruit and vegetables, their origin and the benefits of eating healthy by getting the recommended five a day. 38 Bord Bia Irish Food Board Annual Report 2013 Marketing, Innovation, Training and Information During the year 38 horticulture businesses received assistance under the Bord Bia Marketing Assistance Programme in for a range of activities including trade shows, market research, POS & labelling generation and website development. The Bord Bia foresight4food programme also assisted a number of nurseries in brand development and consumer focus work. Research on the size and trends in the retail fresh produce market was disseminated to the sector and similar information was provided on the UK mushroom market to the export marketing companies. In addition, the annual census data on selected crops and yield information on potatoes were made available to the relevant sectors. A supplier development programme continued with nursery growers to assist them in delivering profitable sales growth for their businesses through retail markets. The programme had 19 participants and included workshops and one-to-one business mentoring. Bord Bia partnered for the third time with the Irish Potato Federation in organising a trade stand at the Fruit Logistica fresh produce trade show in Berlin in 2013. It is the largest fresh produce trade fair globally and provided an opportunity for participating companies to build on existing market contacts and to find potential new buyers across a wide range of countries for Irish grown potatoes and fresh produce. Bloom The €5.5 million estimated spending at Bloom 2013 provided a significant boost to small specialist nurseries and artisan food companies. Held in the Phoenix Park on the June bank holiday weekend the event attracted a record attendance of 110,000 visitors over five days. Many new features in the year of ‘The Gathering’ included a public engagement feature for Origin Green and a call to action to support the food and drink industry on its journey of sustainability, a new concept garden space featured postcard gardens, a botanical art exhibition, the Irish Cheese Awards, the introduction of a Show Garden Guide and the launch of a Bloom Supplement in the Saturday edition of the Irish Independent newspaper. Amenity Sector Strategy The implementation of the recommendations in the Amenity Sector Strategy continues and includes the development of new plant varieties and cut foliage variety trials. The amenity Export Development Programme continued in 2013 and both daffodil bulb growers and nursery stock producers participated in mentoring and sales support. Bord Bia also assisted in the organisation and supported key trade events including the horticulture industry trolley fairs and the amenity trade show Garden Landscape Amenity Showcase (GLAS), both of which are clearly focused on promoting and facilitating local plant sales. Bord Bia are involved in the organisation and planning for the International Garden Centre Congress which will be held in Ireland during August 2014 and will provide a showcase for the best of Irish Garden Centres, gardens and plants to an international audience. Amenity Quality Programmes A total of 50 garden centres and 20 landscape contractors participated in the Bord Bia Amenity Quality Programmes during 2013. These provide horticultural enterprises with guidelines on ‘best practice’ in managing their businesses. In addition, the Nursery Quality Programme is now operating to the EN45011 standard with independent inspection and certification now completed for 20 members. Certified members are availing of the opportunity to use the Bord Bia Quality Mark on plant labels. Services Quality and Environmental Assurance A record number of 29,764 producer audits for the Beef & Lamb Quality Assurance Scheme (BLQAS) were conducted during 2013. This represented a 25% increase on the number of audits completed in 2012 and significant among these were 11,006 new applicants, up from 4,121 in 2012. By the end of 2013 there were 41,065 certified members of the BLQAS up 22% on 2012. It is estimated that at year end over 87% of all finished beef was produced on quality assured farms. The Pigmeat Quality Assurance Scheme for producers was revised to incorporate updated legislation, salmonella controls, DNA testing of sires and outdoor production. The revised standard received accreditation from the Irish National Accreditation Board (INAB) and auditing to it commenced in April. At processor level the individual standards for each species i.e. beef, lamb, poultry and pigs were amalgamated into one standard – the Meat Processor Quality Assurance Scheme Standard. INAB conducted both a review of the standard and a witnessed audit and granted accreditation in August. Auditing to the new standard commenced in October. Following a review of the Horticulture Grower and Pre-packer Standard it was decided to adopt a modular approach, where potential members could choose the modules relevant to their businesses. During the year, three distinct modules were developed – Grower, Packer and Distributor (GPD). These GPD Modules will be submitted to INAB in early 2014 along with two new horticulture modules developed for Sprout Production and Horticulture Sustainability. Both the Mushroom Substrate and the Ornamental Horticulture Standards were completed during the year and submitted for accreditation. A Retail Butcher Assurance Scheme had been previously developed to recognise butchers stocking all quality assured product. In July the butcher counter in SuperValu, Midleton became the first certified member of the scheme. A number of other businesses have also expressed an interest in this scheme. Work on the development of a new scheme for dairy farmers continued during 2013 and included a significant emphasis on sustainability and carbon footprint measurement. Development of the new scheme, known as the Sustainable Dairy Assurance Scheme (SDAS), was completed by a Technical Advisory Committee comprising representatives from farming organisations, dairy co-operatives, milk purchasers, the Department of Agriculture, Food and the Marine, Teagasc, the Food Safety Authority of Ireland and Bord Bia. The Minister for Agriculture, Food and the Marine, Simon Coveney TD formally launched SDAS in December with auditing due to commence in January 2014. It is Bord Bia Irish Food Board Annual Report 2013 39 expected that the majority of the 18,000 dairy farmers in the country will join the SDAS over the next 18 months. All of the remaining Bord Bia Quality Assurance Schemes: the Egg Quality Assurance Scheme for packers and producers and the Poultry Products Quality Assurance Scheme for producers retained their accreditation in 2013. Strategic Information Services Consumer Insight Bord Bia’s Consumer Insight and Innovation team is responsible for ensuring the consumer is at the heart of marketing and innovation strategies for Irish food and drink businesses. It works across small, medium and large enterprises and offers tailored programmes for each. In the foresight4food programme, food and amenity horticultural companies are encouraged to take a consumer-centric perspective in generating and developing new product ideas or branding initiatives. During 2013, 63 individual insight, branding and innovation projects were conducted. Of these 25 were in overseas markets, while 38 were conducted in the domestic market. The foresight4food programme offers a ‘syndicated’ version targeting businesses with turnover of less than €3.5 million and during 2013, 25 companies participated. Consumer research is shared by a group of small businesses and each business benefits from insight and marketing consultancy. During 2013 the Insights team championed the use of ethnography, specifically for the dairy sector, to help Irish exporters understand consumers in developing markets across Asia and Africa. Ethnographic studies have provided a rich source of insight, beyond conventional studies and Bord Bía was awarded the qualitative research excellence award by the Marketing Society in 2013 for ethnographic research undertaken for Glanbia in Senegal. To help generate ideas and creativity and to assist companies and entrepreneurs with first stage innovation stimulation, the Insights team organises Inspirations Expeditions which are provocative market immersion visits that look into food culture and consumer trends. Visits to Cape Town and New York during 2013 had 25 participants from 19 companies. Workbooks The Branding and Innovation workbooks are being used by food and drink companies in ‘live’ projects to provide a structured approach that will improve the prospects for successful innovation and branding. In 2013 the team worked closely with 15 small and medium size companies embedding best practice. Brand Forum The cornerstone of the Brand Forum are quarterly events which present Irish food and drink brand owners with the opportunity to step back from daily challenges, to be informed of the latest research and trends, to be inspired by the speakers, panel discussions, practical workshops and to network with over 200 Irish food and drink companies. 40 Bord Bia Irish Food Board Annual Report 2013 Now in its fourteenth year, the Brand Forum provides Irish food and drink brand owners with a dedicated platform to collaborate and pool their individual expertise, ideas and problems. Incorporated into the enlarged Insight and Innovation team, the programme has gained further momentum by integrating the best-inclass case study presentations with the customised branding work undertaken with client companies. Members of the Brand Forum continue to participate in the “Brand Health Check”, a national on-line survey across 45 grocery categories. An additional number of branding workshops, which were customised to the food and drink brand owners, were offered to member companies and included – Social Media Marketing and Packaging design. Food Works Recognising entrepreneurship as the seedbed for innovation and growth, Bord Bia, Teagasc and Enterprise Ireland combined resources to launch the Food Works Programme in March 2012. Now in its second year, the Food Works Programme continues to create and nurture global food entrepreneurs. As Food Works is a three agency approach to entrepreneurship, each project was provided with the support to help assess their business idea from the consumer, commercial and technical perspective. Throughout 2013 the programme included 10 workshops, numerous advisory sessions, in-depth consumer research, a September visit to London to attend the Speciality and Fine Food Fair and to undertake a market study visit and a networking evening. Food Works concluded with 11 companies presenting feasibility studies at the end of 2013 of which 5 with the strongest feasibility analysis will be selected to progress further. These companies will work on the granular detail of developing an investor ready business plan with a view to presenting their completed business plans to potential investors in July 2014. Published Research A programme of original research was continued through 2013 and was published through the Bord Bia website including: PERIscope provides biennially, a detailed perspective on how consumers view food related issues and report their behaviours. The 2013 update of the study explored consumer eating behaviours, purchasing attitudes and shopping & cooking trends amongst consumers in 10 markets – Ireland & Great Britain, six continental European markets, along with the US and New Zealand. The study received a large amount of national radio and press commentary and was presented at four seminars in the fourth quarter. The Insight team continues to embed the findings across companies on an individual basis. The Lunchtime Occasion study was completed in late 2013. It explored the eating habits around the lunchtime occasion and the various tools and foods that consumers are using to control their budget and ingredients to manage diet and health. The study was shared with companies at a lunchtime seminar and over 35 clients attended. Tomorrow’s Shopper: Looking to the Future was a study that explored shopper behaviour today and in the future. Technology is one of the key catalysts and digital technology has become a key driver of how the consumer interacts with brands and how this will evolve in the future. The findings of the study were shared at a breakfast seminar in which over 50 companies participated. Retaining Loyalty to Irish Brands 3 was the third iteration on what is an important topic for Irish brand owners. The 2013 report explored the dramatic impact of the changes in the Irish retail landscape and the subsequent challenges and opportunities for Irish brands and products. The study was presented at a client seminar where over 35 companies attended. The Consumer Lifestyle Trends programme enables companies to be more outward looking, future focused, consumer driven and acts as a catalyst for new ideas and innovations. In many ways, it is the cornerstone of our Consumer Insights programme. In 2013 the Insight team presented and ran workshops to over 60 food and drink companies. Weekly Newsletter FoodAlert continues to be published on the Bord Bia website with subscribers emailed each week with headline issues and offers a Bord Bia perspective on developments in the food business across the world along with price series on key commodities. Inquiries Team The inquiry team responds to external as well as internal enquiries using an array of international reports, trade press and databases as well as our own original research. There were in excess of 1,250 external enquiries during 2013 with more than a further thousand enquiries made by colleagues working on projects during the year. Marketing Services Trade Fairs Event Services managed 52 trade fairs, exhibitions and events across all industry sectors and promotional platforms during 2013. The Origin Green programme branding launched at SIAL in 2012 was rolled out across 18 international trade fairs and exhibitions during 2013 to a combined audience of over 850,000 buyers/ visitors. With the aim of expanding export reach further the mix of exhibitions included major flagship shows such as ESE and Anuga, as well as sector specific trade fairs such as ISM (confectionery), Biofach (organic), Fruit Logistica (horticulture), MDD (private label), Tuttofoods (meat), VinExpo (alcoholic beverages), Speciality & Fine Food Fair (artisan products), Conxemar & Chinese Fisheries & Seafood Expo (seafood), CIMIE (meat), TFWA (travel retail) and the bi-annual ingredients fair, FIE. Exhibitions focusing on particular regions in 2013 included Prodexpo in Moscow, Gulfood in Dubai and SIAL China in Shanghai. The significance of the Middle East region was highlighted by the Trade Mission to the UAE and Saudi Arabia. Led by the Minister of Agriculture, Food and Marine, 21 Irish food companies travelled to Abu Dhabi, Riyadh and Dubai on itineraries pre-arranged by Bord Bia. In addition, itineraries were organised for 12 food companies participating on the Trade Mission to Tokyo, Japan lead by An Taoiseach, Enda Kenny TD. Key events organised and managed in Ireland were the Sustainability Conference for 750 delegates in the Convention Centre Dublin, which included a full week of itineraries for international delegates/buyers. The first Bord Bia Christmas Market took place over four days in the chq Building in the IFSC with 30 companies participating. Other activities included The Chefs’ Irish Beef Club visit, IMS EC Workshop, the Bord Bia Food Awards Gala Dinner, the Brand Forum’s programme of events, The Food Village and catering at Bloom, Bord Bia’s presence at the National Ploughing Championships, The Global Irish Economic Forum and the Mushroom Conference. Sponsorships During 2013, Bord Bia sponsored the fourth series of Neven Maguire’s Home Chef on RTE 1 aimed at increasing understanding of the Quality Mark and increasing consumer loyalty to it. This series featured Neven Maguire and other chefs using quality assured ingredients in their kitchens over thirteen episodes. Viewership numbers started at a record high of 471,000 for the first episode and has settled at around 270,000 weekly viewers. A nationally representative survey of consumers indicated that 72% had more positive perceptions of the Quality Mark as a result of watching the series. Of these, 64% said that they would be more likely to buy food with the Quality Mark. Bord Bia Irish Food Board Annual Report 2013 41 Award sponsorships in 2013 included the food, beverage and seafood categories of both the Small Firms Association and the Irish Exporter Awards. Other sponsorships included the Supreme Champion category in the Blás na hEireann awards (the Best Artisan Producer category was sponsored by the Taste Council), the Food Producer of the Year category of the Good Food Ireland Awards and the Food and Drink Entrepreneurial StartUp of the Year in the Start-Up Awards. A number of agri food related events and conferences linked to The Gathering and the Presidency of the European Union were also supported in 2013. These included the Copa Cogeca Presisium, Cais European Cheese Congress, as well as the Ballymaloe Literary Festival of Food and Wine. These provided Bord Bia with opportunities to showcase the best of Irish food and drink products and to highlight the Origin Green Sustainability Programme to international audiences. 42 Bord Bia Irish Food Board Annual Report 2013 Marketing Finance Bord Bia’s Marketing Assistance Programme (MAP) provides small and medium-sized enterprises with assistance towards improving their marketing techniques and capabilities. In 2013, grant aid was provided to companies in the farmhouse cheese, beverages, chilled dairy, confectionery, bakery, prepared meals, charcuterie, seafood and horticulture sectors. Participating companies have an annual turnover of between €100,000 and €3.5million. During 2013, 203 MAP applications were received and 187 approved. Grants totalling €850,639 were paid to 155 companies during the year. Home Market The Quality Mark marketing programme is part of the strategic priority to maintain a vibrant and dynamic home market. In 2013 the aim was to continue to increase the number of consumers only buying food with the Bord Bia Quality Mark. Targeting the relatively larger meat purchasers, 30-60 year old female grocery shoppers, the key message was that food with the Bord Bia Quality Mark is produced to the highest Bord Bia quality standards and you know where it comes from. Quality Mark activities included generic promotion to increase consumer understanding and loyalty as well as specific programmes to increase purchasing of pigmeat, lamb and eggs with the Quality Mark. In total 12 campaigns took place including a campaign for fish. The ‘Just Ask’ campaign continued to encourage restaurants to highlight the origin and suppliers of meat on their menus for customers. Key activities included 35 weeks of TV advertising, sponsorship of the RTE1 ‘Home Chef’ programme and a range of integrated PR and digital activities. In terms of results, 89% of Irish consumers are aware of the Quality Mark- up from 60% in 2004. Of these, half of all Irish adults associate the Quality Mark most strongly with the intended messages of rigid safety controls and/or Irishness and traceability. In addition, 66% say that they would be more likely to buy a food product having seen the Quality Mark on it – up from 54% in 2006 (Source: Behaviour and Attitudes – November 2013). The increased consumer demand for meat with the Quality Mark has in turn resulted in retailers increasing the proportion of shelf space with quality assured meat. In 2013, 68% of meat facings across retailers carried the Quality Mark compared with 64% in 2011. Bord Bia’s ‘Your Food is Our Passion’ television advertising campaign continued to rank in the top ten advertising campaigns in terms of consumer awareness and impact. The increased focus on digital activities to target consumers also resulted in the number of Bord Bia Facebook fans increasing from 10,000 to over 50,000 during 2013. TASTE Council The TASTE Council is an independent voluntary body representing the artisan and speciality sector for which Bord Bia provides a secretariat role. The TASTE Council in association with Bord Bia hosted the third Food Summer School at Ballymaloe, Shanagarry, Co. Cork. The theme of the Summer School was food education in post primary schools and at third level and it was attended by 120 delegates including artisan producers, representatives from the educational sector, government bodies and the media. A Food Module has been developed by the Taste Council and Bord Bia for transition year secondary school students with the objective of increasing students’ understanding of the benefits of artisan food. Following piloting in eight schools, the Food Module will be rolled out to a wider number of schools nationwide in September 2014. Other activities by the TASTE Council included making a submission to the FSAI regarding the European Commission proposal for a new regulation on official controls performed to ensure the verification of compliance with feed and food law, animal health and animal welfare rules. The Council is also representing the artisan sector in the Dublin City Council redevelopment of the Dublin City Market (formerly the wholesale Fruit, Flower and Vegetable Market off Capel Street) which is being adapted to include a retail food market. Markets Bord Bia’s global footprint extends to 11 overseas locations with the eleventh office opening in Dubai on 1st March, 2014. Seven offices operate in Europe and four internationally. The Irish market business development and other international markets are served directly from Dublin. The allocation of resources and the structure are continuously reviewed to meet the evolving needs of the Irish food, drink and horticulture companies through a market prioritisation process. In order to meet the needs of Irish companies, promoting Irish products and showcasing Irish supply capability, these offices and personnel were resourced to: • U ndertake increased buyer contact activity. • Supply marketplace services to equip companies to secure new business. • Acquire, assimilate and convey relevant market information to client companies. In addition to the implementation of programmes and projects, particularly the recruitment of 300 international buyers for the Sustainability Summit in September, Bord Bia’s markets personnel in 2013: • U ndertook 890 buyer meetings and presentations. • R esponded directly to 855 individual buyer requests for detailed information on the Irish food and drink industry, particularly suitable suppliers. • C onducted 791 business planning meetings with Irish client companies. • R esponded to 1,837 market information requests from Irish client companies. • D elivered bespoke business development projects with more than 50 client companies per month. • R epresented the industry in 57 market-access meetings with veterinary and regulatory authorities in Asia, Russia and the Middle East. • A chieved positive coverage for Irish food and drink in over 200 consumer and trade titles, along with numerous on-line mentions. A Collaborative Approach Bord Bia continues to work in partnership with key government departments, agencies and associations in the development and implementation of support for the food and drink industry. These included the Department of Agriculture, Food and the Marine, Teagasc, BIM, Department of Foreign Affairs and Trade, Enterprise Ireland, Failte Ireland (and Tourism Ireland), Food Safety Authority of Ireland and the Environmental Protection Agency, among others. • Represent the Irish food industry in developing relationships with opinion formers along with key trade and consumer media. Bord Bia Irish Food Board Annual Report 2013 43 Our Governance 44 Bord Bia Irish Food Board Annual Report 2013 Corporate Statement Bord Bia was established under the Bord Bia Act 1994 and operates in accordance with the provisions of the Bord Bia Acts 1994 & 2004 and under the aegis of the Minister for Agriculture, Food and the Marine. Governance The Board has adopted the Code of Practice for the Governance of State Bodies and the provisions of the Code are being implemented. For the purposes of applying the Code of Practice for the Governance of State Bodies, Bord Bia is regarded as a noncommercial State Body. The Board is committed to maintaining the highest standards of Corporate Governance and Best Practice, has a formal schedule of matters specifically reserved to it for decision, provides strategic guidance, monitors the activities and effectiveness of management and monitors compliance on an ongoing basis ensuring relevant legislation, regulations and guidelines are complied with. Ethics in Public Office The provisions of the Ethics in Public Office Act 1995 and the Standards in Public Office Act 2001 have been implemented. Board members and staff members holding designated positions furnish statements of interests on appointment and each year to the Secretary. Freedom of Information Bord Bia is a prescribed organisation under the Freedom Of Information Acts 1997 and 2003. The Freedom of Information Acts established three statutory rights: • A legal right for each person to access information held by public bodies; • A legal right for each person to have official information held by a public body, relating to him/herself, amended where it is incomplete, incorrect, or misleading; • A legal right to obtain reasons for decisions affecting oneself taken by a public body In addition to the requirements of the Freedom of Information Acts, the Data Protection Acts 1988 and 2003 also apply to Bord Bia. The Data Protection Acts protect the privacy of individuals whose personal data is being processed. Personal data is information relating to a living individual who can be identified from the data itself or in conjunction with other information held. Equality Bord Bia is committed to ensuring equality of opportunity and its personnel and staff development programmes are structured accordingly. Bord Bia endeavours to assist staff in relation to career and personal needs and operates appropriate policies covering such areas as professional development, study leave, flexible working and career breaks. Bord Bia is also committed to implementing government policy in relation to the employment of disabled people in the public sector. Specific additional provisions were made for disabled visitors in the construction of Bord Bia’s Food Centre. There is a policy on sexual harassment in operation to support and protect the dignity of each person. Safety, Health and Welfare at Work Bord Bia is implementing the provisions of Safety, Health & Welfare at Work legislation, including the preparation and operation of a Safety Statement embracing all matters affecting safety, health and welfare of staff and visitors to Bord Bia’s premises. of Quality Customer Service for Customers and Clients of the Public Sector. The Charter is supported by an Action Plan and appropriate internal procedures to give practical effect to this commitment. Energy Efficiency and Conservation Bord Bia is committed to making every effort possible to be energy efficient and to operating appropriate conservation and recycling measures. Light and heat, supplied by electricity, are the main areas of energy use in Bord Bia. Annual energy usage has been reduced significantly since commencing a review of energy usage. Usage within Bord Bia’s main office is as follows: 2013 mWh of electricity 272   (Base year 2009: 379 mWh) Actions undertaken in 2013 Passive infra-red occupancy light control switches were installed along with low voltage light fittings in a number of areas where the changed level of lighting and cost/benefit were acceptable. Actions planned for 2014 Bord Bia will continue to monitor energy usage and examine cost effective initiatives to further improve our energy performance. Prompt Payments In accordance with the provisions of the Prompt Payment of Accounts Act Service Charter Bord Bia’s Service Charter sets out its commitment to the Principles Bord Bia Irish Food Board Annual Report 2013 45 1997 as amended by the European Communities (Late Payment in Commercial Transactions) Regulations 2002, Bord Bia is committed to ensuring that all suppliers are paid promptly and during 2013 over 99% of payments were made within 15 days. Official Languages Act 2003 Bord Bia comes under the remit of the Official Languages Act 2003 to provide a statutory framework for the delivery of services through the Irish language. In accordance with Section 10 of the Act, this Annual Report is published simultaneously in Irish and English. Board Structures Bord Bia comprises the Board, five Subsidiary Boards, the Chief Executive and the Executive, which provide a range of services to implement Board policy and programmes. The Board provides the appropriate balance of skills and experience to support the strategy of Bord Bia. The Board comprises a Chairman and fourteen ordinary members appointed by the Minister for Agriculture, Food and the Marine. All new board members receive financial and other information about Bord Bia, and the role of the board and the board committees. The roles of the chairman and chief executive are separate. There are five Subsidiary Boards (Meat and Livestock, Consumer Foods, Dairy, Quality Assurance and Horticulture) comprising a Chairman and twelve ordinary members, who are appointed by the Board with the consent of the Minister for Agriculture, Food and the Marine. The Chairman of each Subsidiary Board is a member of the Board. The Dairy Subsidiary Board was established during the year to provide the necessary governance for funding 46 Bord Bia Irish Food Board Annual Report 2013 provided by the sector to enhance communication initiatives developed for promotion of the sector. The board meets regularly and is responsible for the proper management of Bord Bia. It takes the major strategic decisions and retains full and effective control while allowing executive management sufficient flexibility to run the business efficiently and effectively within a centralised reporting framework. Board Members and Meeting Attendance There were seven Board meetings held during 2013 and the details of each member’s attendance, is set out below. Board Member Board Meetings Attended G. Brown 5 out of 7 J. Bryan 7 out of 7 M. Byrne 7 out of 7 Board Members and Independence M. Carey 7 out of 7 J. Comer 6 out of 7 All board members have access to advice and services of the Secretary/ Director Corporate Services who is responsible to the board for ensuring that board procedures are followed, and applicable rules and regulations are complied with. Bord Bia’s professional advisors are available for consultation by board members as required. Individual board members may take independent professional advice if necessary. M. Cronin 7 out of 7 A. Dennison 3 out of 3 K. Dunne 5 out of 6 F. Hayes 5 out of 7 R. Holland 5 out of 7 J. Horgan 6 out of 7 C. Keeling 1 out of 1 J. Kingston 7 out of 7 F. O’Gara 3 out of 6 B. Sweeney 6 out of 7 Composition of the Board Details of members of the Board of Bord Bia are set out on page 51. The Roles of the Chairman and the Chief Executive The Chairman leads the Board in the determination of its strategy and in the achievement of its objectives. The Chairman is responsible for organising the business of the Board, ensuring its effectiveness and setting its agenda. The Chairman facilitates the effective contribution of all board members and constructive relations between the executive and board members, ensures that board members receive relevant, accurate and timely information. The Chief Executive has direct charge of Bord Bia on a day to day basis and is accountable to the Board for Bord Bia’s financial and operational performance. Board Committees The Board Audit Committee, which comprises three members of the Board and one external member with a financial background, met on four occasions during 2013. The Board Audit Committee is responsible for maintaining an appropriate relationship with the group’s external auditors and for reviewing Bord Bia’s internal audit resources, internal financial controls and the audit process. It aids the board in seeking to ensure that the financial and non-financial information presents a balanced assessment of our position. The Internal Auditor and the External Auditor have full and unrestricted access to the Board Audit Committee. Briefing sessions are held to apprise members of the Board Audit Committee and the Board of relevant and recent developments in Corporate Governance issues. The Remuneration and Pensions Committee, which comprises four members of the Board, met on one occasion during 2013. The Remuneration and Pensions Committee determines on behalf of the Board the appointment, remuneration and assessment of the performance of, and succession planning for, the Chief Executive; and significant amendments to the pension benefits of the Chief Executive and staff. The Strategy Committee, which comprises five members of the Board, met on one occasion during 2013. The Strategy Committee plays an important role in providing observations and recommendations concerning strategic issues facing Bord Bia and contributes to our strategic planning process and the development of strategy. Board Responsibilities Section 21 of An Bord Bia Act 1994 requires the Board to “keep in such form and in respect of such accounting periods as may be approved by the Minister, with the consent of the Minister for Finance, all proper and usual accounts of monies received or expended by it, including an Income and Expenditure Account, a Cash Flow Statement and a Balance Sheet and, in particular, shall keep in such form as aforesaid all such special accounts as the Minister may, or at the request of the Minister for Finance shall, from time to time direct and the Board shall ensure that separate accounts shall be kept and presented to the Board by any Subsidiary Board that may be established by the Board under this Act and these accounts shall be incorporated in the general statement of account of the Board.” 3. Prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Board will continue in operation. In preparing these financial statements the Board is required to: Michael Carey Chairman 4.State whether applicable accounting standards have been followed, subject to any material departures disclosed and explained in the financial statements. The Board is responsible for keeping proper books of account, which disclose, with reasonable accuracy at any time, the financial position of Bord Bia. The Board is also responsible for safeguarding the assets of the organisation and hence for taking reasonable steps for the prevention and detection of fraud or other irregularities. Aidan Cotter Chief Executive 1. Select suitable accounting policies and then apply them consistently. 2.Make judgements and estimates that are reasonable and prudent. Bord Bia Irish Food Board Annual Report 2013 47 Statement on Internal Financial Control On behalf of the Board of Bord Bia, I acknowledge our responsibility for ensuring that an effective system of internal financial control is maintained and operated. The system can provide reasonable, but not absolute, assurance that assets are safeguarded, transactions authorised and properly recorded and that material errors or irregularities are either prevented or would be detected in a timely period. The system of internal financial control is based on a framework of regular management information, administration procedures including segregation of duties and a system of delegation and accountability. In particular it includes: The Board has taken steps to ensure an appropriate control environment is in place by: • A comprehensive budgeting system with an annual budget which is reviewed and agreed by the Board • C learly defining management responsibilities and powers • E stablishing formal procedures for monitoring the activities and safeguarding the assets of the organisation • D eveloping a culture of accountability across all levels of the organisation The Board has established processes to identify and evaluate business risks by: • Identifying the nature, extent and financial implication of risks facing the body, including the extent and categories which it regards as acceptable • A ssessing the likelihood of identified risks occurring • W orking closely with Government and various Agencies to ensure that there is a clear understanding of Bord Bia goals and support for the Board’s strategies to achieve those goals 48 Bord Bia Irish Food Board Annual Report 2013 • R egular reviews by the Board of periodic and annual financial reports which indicate financial performance against forecasts • S etting targets to measure financial and other performance Bord Bia has an outsourced internal audit function, which operates in accordance with the Framework Code of Best Practice set out in the Code of Practice for the Governance of State Bodies and, which reports directly to the Board Audit Committee. The work of internal audit is informed by analysis of the risk to which the body is exposed and annual internal audit plans are based on this analysis. The analysis of risk and the Internal Audit plan are endorsed by the Board Audit Committee and reported to the Board. The risk register is reviewed at each Board Audit Committee meeting and at each Board meeting. The Board Audit Committee meets on a regular basis throughout the year to review and confirm the ongoing adequacy and effectiveness of the system of Internal Financial Control. The Board’s monitoring and review of the effectiveness of the system of internal financial control is informed by the work of the Internal Auditor, the Board Audit Committee which oversees the work of the internal auditor, the executive managers within Bord Bia who have responsibility for the development and maintenance of the financial control framework and informed by the work of the Comptroller and Auditor General in his annual audit. I confirm that in the year ended 31st December, 2013 the Board conducted a review of the effectiveness of the system of internal financial control. On behalf of the Board Michael Carey Chairman Organisation Structure Bord Bia is comprised of the Board, five Subsidiary Boards, the Chief Executive and the Executive, which provide a range of services required to implement Board policy and programmes. Main Board Chairman Meat & Livestock Board Chairman Consumer Foods Board Chairman Horticulture Board Chairman Dairy Board Chairman Quality Assurance Board Chairman Chief Executive Markets Meat & Livestock Food & Beverages European & International Horticulture Quality Sustainability Corporate Services & Finance Information Consumer Insight Marketing Services Corporate Communications Human Resources The Board is comprised of a Chairman and 14 ordinary members appointed by the Minister for Agriculture, Food and the Marine. There are five Subsidiary Boards (Meat and Livestock, Consumer Foods, Dairy, Quality Assurance and Horticulture) comprised of a Chairman and 12 ordinary members, who are appointed by the Board with the consent of the Minister. The Chairman of each Subsidiary Board is a member of the Board. The following Board Committees are in place: Audit Committee, Remuneration and Pensions Committee and Strategy Committee. The Executive is comprised of staff based in the Board’s head office and overseas. General Information Head Office: Clanwilliam Court, Lower Mount Street, Dublin 2. Auditors: Comptroller and Auditor General Bankers: Allied Irish Banks Solicitors: Philip Lee Solicitors Bord Bia Irish Food Board Annual Report 2013 49 Staff Structure Chief Executive Aidan Cotter Markets International Markets Quality and Environmental Assurance Marketing Services Meat & Livestock Food and Beverages Horticulture/Food Dudes Strategic Information Services Corporate Communications Human Resources Corporate Services Finance Michael Murphy Breiffini Kennedy Michael Maloney Una Fitzgibbon Jim O’Toole Tara McCarthy Mike Neary Julian Smith Rosaleen O’Shaughnessy Susan Doyle Frank Lynch Gerry Bailey Overseas Offices   Amsterdam Dubai Dusseldorf London Madrid Milan Moscow New York Paris Shanghai Stockholm Margaret McCarthy Michael Hussey Vacant Michelle Butler Cecilia Ruiz Liam MacHale Alla Barinova Karen Coyle Noreen Lanigan James O’Donnell Nicolas Ranninger Human Resource activities within Bord Bia support management and staff to meet the challenges of the marketplace through: • E stablishing appropriate management structures to support the strategic aims of the organisation • Appropriate performance management systems • Leadership, management and staff development • Regular communication and engagement initiatives The organisational culture is driven by continual prioritisation and innovation, the maximisation of outputs, and the delivery of efficiencies through the optimal use of resources and systems. Open dialogue ensures that Bord Bia resources remain responsive to the fast changing environment in which we live today. 50 Bord Bia Irish Food Board Annual Report 2013 Bord Bia Board Chairman Chief Executive Changes during 2013 Mr Michael Carey The Company of Food Aidan Cotter Term Expired 22nd March: Mr John Comer (re-appointed 12th April) Members Mr Gary Brown Executive Chairman Target McConnells Ms Marian Byrne Principal Officer, Department of Agriculture, Food and the Marine Mr John Comer President, Irish Creamery Milk Suppliers’ Association Mr Michael Cronin Former Chairman, Irish Dairy Board Mr Eddie Downey President, Irish Farmers’ Association Mr Frank Hayes Director Corporate Services, Kerry Group Plc. Ms Rhona Holland Marketing Director Global Intelligence, Pepsi Co. Secretary/Director Frank Lynch Terms Expired 27th June: Ms Anne Maria Dennison, Irish Countrywomen’s Association Term Expired 28th November: Mr Kieran Dunne, L & K Dunne Nurseries Term Expired 1st December: Prof Fergal O’Gara (re-appointed 30th January 2014) Resigned 31st December: Mr John Bryan Former President, Irish Farmers’ Association Appointed 10th December: Ms Caroline Keeling Changes during 2014 Appointed 30th January: Mr Eddie Downey Mr John Horgan Managing Director, Kepak Group Ms Caroline Keeling Chief Executive, Keelings Mr John Kingston Beef & Dairy Farmer Prof Fergal O’Gara Department of Microbiology, University College Cork Mr Brody Sweeney Food Entrepreneur Bord Bia Irish Food Board Annual Report 2013 51 Bord Bia – Consumer Foods Board Bord Bia – Meat and Livestock Board Chairman Chairman Ms Rhona Holland Marketing Director Global Intelligence, Pepsi Co. Members Ms Triona Byrne Finance Director, Aran Candy Ltd. Changes during 2013 Vacant Appointed 4th March: Ms Rhona Holland Members Term Expired 26th July: Mr Pat Connors (re-appointed 3rd October) Mr Henry Burns Chairman, National Livestock Committee, Irish Farmers’ Association Mr Bernard Coyle (re-appointed 3rd October) Mr Pat Connors Sales & Processing Director, Marine Harvest Mr Tom Harrington, Public Representative Mr Bernard Coyle Chairman, Mr Crumb Mr Jack Teeling, Former Managing Director, Cooley Distillery Mr Mike Doyle Managing Director – Meat & Savoury Provisions Kerry Foods Term Expired 10th October: Mr Colin Gordon (re-appointed 3rd October) Mr Colin Gordon Chief Executive, Glanbia Consumer Foods Mr Larry Murrin Managing Director, Dawn Farm Foods Mr John Noonan Sales & Marketing Director, E. Flahavan & Sons Mr Joe O’Flynn Senior Partner, Agrifood Business Partners Mr Eddie Power Managing Director, Green Isle Foods Appointed 28th February: Mr Pat O’Flaherty Mr Michael Guinan Irish Creamery Milk Suppliers’ Association Appointed 7th March: Mr Paddy Walsh Mr Jim Hanley Chief Executive, Rosderra Irish Meats Mr John Lynskey Chairman, National Sheep Committee, Irish Farmers’ Association Mr Brendan Mallon Associated Craft Butchers of Ireland Mr Finbarr McDonnell Managing Director, ABP Mr Pat O’Flaherty Chairman, National Pigs & Pigmeat Committee, Irish Farmers’ Association Mr Nigel Renaghan Chairman, National Poultry Committee, Irish Farmers’ Association Changes during 2013 Resigned 7th January: Mr John Horgan, Managing Director, Kepak Group Bord Bia Irish Food Board Annual Report 2013 Resigned 8th February: Mr Tim Cullinan, Former Chairman, National Pigs & Pigmeat Committee, Irish Farmers’ Association Mr Paddy Gernon Livestock Exporter Mr Paddy Walsh Dawn Meats 52 Term Expired 10th February: Mr Jim Hanley (re-appointed 14th March) Appointed 26th April: Mr Paddy Gernon Term Expired 25th October Mr Vincent Carton, Chief Executive, Carton Group Resigned 31st December Mr John Bryan (Chairman) Former President, Irish Farmers’ Association Changes during 2014 Resigned 5th February: Mr Alo Mohan Former Chairman, National Poultry Committee, Irish Farmers’ Association Mr James Murphy Former Chairman, National Sheep Committee, Irish Farmers’ Association Appointed 27th February: Mr John Lynskey Mr Nigel Renaghan Bord Bia – Dairy Board Bord Bia – Quality Assurance Board Chairman Chairman (Appointed 11th April 2013) Mr Michael Carey The Company of Food Members (Appointed 10th June, 2013) Ms Catherine Lascurettes National Dairy & Liquid Milk Executive Secretary, Irish Farmers’ Association Mr James Lynch Vice Chairman, Dairygold Co-operative Society Mr Pat McCormack Deputy President, Irish Creamery Milk Suppliers Association Mr Fergal McGarry Global Director Consumer Foods, The Irish Dairy Board Appointed 26th March: Mr Eamon O’Sullivan Mr Michael Cronin Former Chairman, the Irish Dairy Board Appointed 16th May: Mr Denis Carroll Members Mr Ray Bowe Food Safety & Quality Manager, Musgrave Retail Partners Mr Henry Burns Chairman, National Livestock Committee, Irish Farmers’ Association Mr Denis Carroll Irish Creamery Milk Suppliers’ Association Mr John Cunningham Ex-Dairygold Food Products Mr Brendan Gleeson Assistant Secretary General, Department of Agriculture, Food & the Marine Mr Sean Molloy Director of Strategy & Supplier Relations, Glanbia Mr Dermott Jewell Chief Executive, Consumers’ Association of Ireland Mr Padraig Sayers Vice President, Ingredients & Flavours, Kerry Group plc Dr Pat Shiels General Manager, Agri Division, Lakeland Dairies Mr Paul Nolan Group Development Manager, Dawn Group Mr Padraig Young Chairman, Lakeland Dairies Changes during 2013 Dr Declan Troy Head of Centre, National Food Centre, Teagasc Terms Expired 22nd July: (re-appointed 18th September) Mr Dermott Jewell Mr Paul Nolan Term Expired 1st September: Mr Ray Bowe (re-appointed 18th September) Terms Expired 27th September: (re-appointed 27th November) Mr John Cunningham Mr Michael Doran Changes during 2014 Resigned 17th February: Mr Michael Doran Irish Farmers’ Association Term Expired 18th February: Mr Vincent Carton, Chief Executive, Carton Group Mr Cornelius Traas, The Apple Farm Appointed 25th March: Mr Henry Burns Term Expired 20th January: Mr John O’Leary, Deputy President, Irish Creamery Milk Suppliers’ Association (ICMSA) Resigned 3rd April: Mr Eamon O’Sullivan. Former Head of Supply Chain, Dairygold Co-operative Society Bord Bia Irish Food Board Annual Report 2013 53 Bord Bia – Horticulture Board Chairman Changes during 2013 Vacant Appointed 28th February: Mr Thomas Carpenter Mr John Hogan (re-appointed) Ms Karen Kerrigan Ms Jane McCorkell (re-appointed) Mr Philip Moreau (re-appointed) Members Mr Paddy Callaghan Chairman, Nature’s Best Ltd. Mr Thomas Carpenter Chairman, Potato Committee, Irish Farmers’ Association Ms Rachel Doyle Director, Arboretum Garden Centre Mr Matt Foley Kilbush Nurseries Appointed 27th November: Mr Matt Foley Mr John Hogan Dunsany Landscapes Ltd Term Expired 28th November: Mr Kieran Dunne (Chairman), L & K Dunne Nurseries Ms Karen Kerrigan Kerrigan’s Mushrooms Changes during 2014 Ms Jane McCorkell Landscape Architect & Horticultural Consultant Mr Philip Moreau Glenbrook Nurseries Mr Ciaran O’Brien Peter O’Brien Landscapes Mr Brian O’Reilly National Chairman, Irish Farmers’ Association Horticulture Committee 54 Terms Expired 10th October: Mr Paddy Callaghan (re-appointed 27th November) Mr Martin Jones, Islandview Nurseries Ciaran O’Brien (re-appointed 27th November) Bord Bia Irish Food Board Annual Report 2013 Resigned 10th February: Ms Caroline Keeling, Chief Executive, Keelings Group Bord Bia Irish Food Board Annual Report 2013 55 Our Accounts 56 Bord Bia Irish Food Board Annual Report 2013 Report of the Comptroller and Auditor General Bord Bia Irish Food Board Annual Report 2013 57 Statement of Accounting Policies (a) Basis of accounting: These financial statements are prepared under the accruals method of accounting, except as indicated below, and in accordance with generally accepted accounting principles under the historical cost convention. Financial Reporting Standards recommended by the accountancy bodies are adopted as they become operative. The unit of currency is the Euro. (b) Keeping of accounts: Subsidiary Boards: Under the terms of An Bord Bia Act, 1994, the Board is assisted by five Subsidiary Boards in respect of Meat and Livestock, Consumer Foods and Ingredients, Dairy, Quality Assurance and Horticulture. All income and expenditure relating to these Subsidiary Boards is reflected in these financial statements. (c) Income: Income shown in the financial statements under Oireachtas Grant-inAid represents the actual receipts from this source in the period. Income from the Quality Assurance Schemes Special Funding, the Food Dudes National Roll-Out, and Food Promotions Special Funding is released to revenue in line with related expenditure and any balances due to or from Bord Bia are included in Debtors or Creditors as appropriate. Income arising from the Statutory Levy is accounted for on the accruals basis with the exception of live exports of sheep and pigs which are accounted for on a cash receipts basis. Income arising from the recovery of overseas VAT, under the EU 8th Directive, represents the actual receipts from this source in the period. 58 Bord Bia Irish Food Board Annual Report 2013 (d) Fixed Assets and Depreciation: Fixed assets are stated at cost less accumulated depreciation. Depreciation is calculated to write off the original cost less the estimated residual value of tangible assets on a straight line basis at the following annual rates: Leasehold Improvements Furniture & fittings Office equipment Computer equipment 10% 12½% 20% 331/3% (e) Marketing Finance: Expenditure under this heading is accounted for on the basis of actual payments made. (f) Pensions: There are three Superannuation Schemes in operation within Bord Bia. The Bord Bia main scheme is an unfunded scheme since 31st December 2009. Prior to 1st January 2010 employer and employee contributions were paid into a fund. Under the terms of the Financial Measures (Miscellaneous Provisions) Act, 2009, the assets of the scheme were transferred to the National Pension Reserve Fund with effect from 31st December 2009. The scheme continues in being for existing members. From 1st January 2010, Bord Bia became responsible for the administration of the pension payments to pensioners on behalf of the Exchequer. Under the new arrangement the funding contribution will continue in being and is payable to the Department of Agriculture, Food and the Marine after taking account of pensions paid. The Department will provide funding where the pensions paid exceed the funding and employee contributions. With regard to employees of the former Bord Glas, a non- contributory defined benefit pension scheme and a contributory spouses and children’s scheme are operated on an administrative basis pending the authorisation of the schemes by the Minister for Finance. Under the provisions of An Bord Bia (Amendment) Act, 2004, all staff of the former Bord Glas were transferred to Bord Bia with effect from 1st July 2004. The new Single Public Service Pension Scheme (“Single Scheme”) commenced with effect from 1 January 2013. All new entrants to pensionable public service employment on or after 1 January 2013 are, in general, members of the Single Scheme. The rules of the Single Scheme are set down in the Public Service Pensions (Single Scheme and Other Provisions) Act 2012. Pension costs reflect pension benefits earned by employees in the year. An amount corresponding to the pension charge is recognised as income to the extent that it is recoverable, and offset by Grant-in-Aid received in the year to discharge pension payments for the Bord Glas scheme and any deficit in funding arising on the Bord Bia scheme. Actuarial gains or losses arising on scheme liabilities are reflected in the Statement of Total Recognised Gains and Losses and a corresponding adjustment is recognised in the amount recoverable from the Department of Agriculture, Food and the Marine. Pension liabilities represent the present value of future pension payments earned by staff to date. Deferred pension funding represents the corresponding asset to be recovered in future periods from the Department of Agriculture, Food and the Marine. (g) Leased Assets: (k) Foreign currencies: Assets held under leasing arrangements that transfer substantially all the risks and rewards of ownership (finance leases) to Bord Bia are included in the balance sheet as tangible fixed assets at cost less accumulated depreciation and the capital element of future rentals is treated as a liability. The interest element is charged to the Income and Expenditure Account over the period of the lease in proportion to the balance of the capital repayments. Foreign currency balances are translated at the rates ruling at the balance sheet date. Revenues and costs are translated at the exchange rates ruling at the dates of the underlying transactions. Profits and losses arising from foreign currency transactions and on settlement of amounts receivable and payable in foreign currency are dealt with in the Income and Expenditure Account. Rentals in respect of operating leases are charged to the Income and Expenditure Account as incurred. Provision has been made in respect of all VAT liabilities and the PRSI contributions of Irish persons attached to overseas offices. (h) Tangible assets: Tangible assets are financed out of revenue. Provision is made in the Income and Expenditure Account for a transfer to the Capital Account of amounts allocated for such capital purposes less credits to revenue over the life of the related assets. (i) Stocks: (l) Taxation: (m) Capital Account: The capital grant element of Oireachtas Grant-in-Aid received by Bord Bia is credited to the Capital Account as set out in Note 2, and is transferred to the Income and Expenditure Account over the expected useful lives of the assets to which they relate, in line with asset depreciation. Stocks of stationery are stated at cost. (j) Provision for bad and doubtful debts: Known bad debts are written off and specific provision is made for any amounts the collection of which is considered doubtful. Bord Bia Irish Food Board Annual Report 2013 59 Income and Expenditure Account Year ended 31 December 2013 2012 NOTES E’000 E’000 1a 27,734 27,120 Food Dudes National Roll Out 1b 2,739 1,878 Quality Assurance Schemes: Special Funding 1c 4,401 3,509 Food Promotions Special Funding 1d 655 703 Statutory Levy 1e 5,176 4,598 Project and Other Income 1f 5,388 4,320 Income Oireachtas Grant-in-Aid Oireachtas – Other Funding: Net deferred funding for pensions Transfer from Capital Account 14b 2 Total Income 3,292 2,288 49,385 44,416 49 46 49,434 44,462 Expenditure Marketing and Promotional Expenditure 3 25,772 24,529 Food Dude National Roll Out 1b 2,739 1,878 Quality Assurance Schemes 1c 4,401 3,509 Marketing Finance 4 851 779 Pay 5 11,556 10,717 Operating Expenditure 6 2,761 2,885 48,080 44,297 1,354 165 Total Expenditure Operating Surplus for the year Less: Pension Related Contribution to Exchequer 14a Surplus/(Deficit) for Year after Exchequer Pension Contribution Balance at 1 January Balance at 31 December The results for the year relate to continuing operations. The Statement of Accounting Policies and Notes 1 to 17 form part of these financial statements. Michael Carey Chairman 60 Bord Bia Irish Food Board Annual Report 2013 Aidan Cotter Chief Executive (768) ( 770) 586 ( 605) 10 615 596 10 Statement of Total Recognised Gains and Losses Year ended 31 December NOTES Surplus/(Deficit) for Year after Exchequer Pension Contribution 2013 2012 E’000 E’000 586 (605 ) Actuarial (Loss)/Gain on Pension Scheme Liabilities 14a 4,261 (14,092 ) Adjustment to Deferred Pension Funding 14a (4,261 ) 14,092 Total Recognised Gains/(Losses) for the Year 586 ( 605) The Statement of Accounting Policies and Notes 1 to 17 form part of these financial statements. Michael Carey Chairman Aidan Cotter Chief Executive Bord Bia Irish Food Board Annual Report 2013 61 Balance Sheet As at 31 December 2013 2012 E’000 E’000 152 201 3 3 1,980 2,219 5,225 5,593 7,208 7,815 6,016 7,191 1,192 624 596 614 Net Current Assets less Liabilities 596 10 Total Assets less Liabilities before Pensions 748 211 14b 40,846 42,143 14b (40,846) (42,143) Assets Employed NOTES Fixed Assets Tangible Assets 7 Current Assets Stocks Debtors 8 Cash at bank and in hand Creditors (amounts falling due within one year) 9 Net Current Assets Creditors (amounts falling due after more than one year) Provision for Liabilities and Charges Deferred Pension Funding Pension Liabilities 11 Total Assets less Current Liabilities 748 211 152 201 596 10 748 211 Financed by Capital and reserves Capital account 2 Income and expenditure account The Statement of Accounting Policies and Notes 1 to 17 form part of these financial statements. Michael Carey Chairman 62 Bord Bia Irish Food Board Annual Report 2013 Aidan Cotter Chief Executive Cash Flow Statement Year ended 31 December Reconciliation of Surplus/(Deficit) to Net Cash Outflow from Operating Activities: 2013 2012 E’000 E’000 Surplus/(Deficit) for year 586 (605 ) Net Interest receivable (26) (110 ) Depreciation 142 101 Capital account transfer (49) (46 ) 7 16 Decrease/(Increase) in debtors 239 ( 486) Increase in trade creditors 158 229 Loss on disposal of tangible fixed assets Increase in taxation and PRSI (Decrease)/increase in accruals & deferred income Decrease in provision for liability and charges Net cash outflow from operating activities (1) - ( 1,332 ) 602 (18 ) (10 ) (294) (309) (294) (309) CASHFLOW STATEMENT Net cash outflow from operating activities Returns on investment and servicing of finances: Bank interest received Net current outflow of funds 26 110 (268 ) (199 ) (100) (71 ) (368) (270) (368) (270) Capital Expenditure: Payment to acquire tangible assets Decrease in cash Reconciliation of net cash flow to movement of funds Decrease in Cash Net funds at 1 January 5,593 5,863 Net funds at 31 December 5,225 5,593 The Statement of Accounting Policies and Notes 1 to 17 form part of these financial statements. Michael Carey Chairman Aidan Cotter Chief Executive Bord Bia Irish Food Board Annual Report 2013 63 Notes forming part of the Financial Statements Year ended 31 December 2013 1. Income (a) Included in Oireachtas Grant-in-Aid is €5,330,000 which has been made available to An Bord Bia under the Marketing Sub-Programme of the Productive Sector Operational Programme of the National Development Plan 2007-2013. (b) Amounts included under the heading of Food Dude – National Roll-Out totalling €2,739,119 arise in respect of funding made available by the Department of Agriculture, Food and the Marine to cover the costs of the roll-out of the Food Dude programme on a national basis. (c) Amounts included under the heading of the Quality Assurance Scheme Special Fund totalling €4,401,070 arise in respect of funding made available by the Department of Agriculture, Food and the Marine to cover the costs of independent on-farm inspections and associated certification processes under the Bord Bia Quality Assurance Scheme. (d) Amounts included under Food Promotions Special Funding arise in respect of funding made available by the Department of Agriculture, Food and the Marine in respect of the following programmes: 2013 2012 E’000 E’000 9 8 Domestic & Small Business Organic Promotion 15 158 Biofach Organic trade fair 90 75 Asia- Beef Pork Offal-Promotion (30) 52 “More to Mushrooms” Promotion 445 410 “Just Add Mushrooms” Promotion 84 Farmhouse Cheese Promotion 42 - 655 703 Bloom Garden (e) An Bord Bia Act, 1994, provides for payment to the Board of a levy per head on slaughtered or exported livestock. Under section 37 of the Act, the rates were originally set at €1.90 per head for cattle, 25c per head for sheep and 25c per head for pigs. The statutory pigmeat levy was increased from 25 cent to 35 cent per pig with effect from 1 May 2013. The increase of 10 cent approved by the Minister for Agriculture, Food and the Marine is being used to fund a research and advisory programme by Teagasc for primary pig producers. (f) Project and other income includes industry contributions to joint promotions, trade fairs, information services and seminar and conference fees. Also included is interest receivable of €26,359 (2012: €110,061). 2. Capital account 2013 2012 E’000 E’000 Balance at 1 January 201 247 Amount capitalised in respect of purchased tangible assets 100 71 (7) (16) (142) (101) Net transfer to Income and Expenditure Account (49) (46 ) Balance at 31 December 152 Amounts released on disposal of tangible assets Amortisation in line with asset depreciation 64 Bord Bia Irish Food Board Annual Report 2013 201 Notes forming part of the Financial Statements Year ended 31 December 2013 3. Marketing and Promotional Expenditure 2013 2012 E’000 E’000 Promotions 6,491 5,997 Marketing Development 5,125 5,045 Trade Fairs and Exhibitions 5,432 4,064 Information Services – Research 1,934 2,518 Information Services – Other 1,111 159 Quality Assurance 1,507 1,354 Trade Development 2,516 3,345 Technical Support – Pigmeat Sector 210 Other Client Services 105 119 1,341 1,928 25,772 24,529 851 779 Marketing & Promotion 8,702 8,070 Administration 2,854 2,647 11,556 10,717 7,712 7,864 552 565 Fellowship Plus 4. Marketing Finance Marketing Assistance Programme 5. Pay Pay costs are comprised of: Wages and salaries Social welfare costs Pension costs (Note 14b) 3,292 2,288 11,556 10,717 E E 154,628 160,082 The remuneration of the Chief Executive included in the above pay costs is as follows: Salary In addition, the Chief Executive is a member of the Bord Bia Superannuation Scheme and has pension entitlements which do not extend beyond the standard entitlements in the model public sector defined benefit superannuation scheme. The total number of employees (including part-time persons) at 31 December 2013 was 90 (2012: 90). The cost of certain part-time employees amounting to €82,959 (2012: €89,075) is included in Marketing and Promotional Expenditure. A total of €413,072 (2012: €433,137) was deducted from employees during the year by way of pension levy and was paid over to the Department of Agriculture, Food and the Marine. Bord Bia Irish Food Board Annual Report 2013 65 Notes forming part of the Financial Statements Year ended 31 December 2013 6. Operating expenditure 2012 E’000 E’000 185 192 Rent, rates and insurance 1,121 1,032 Telecommunications costs 275 170 General business expenses 1,009 1,352 22 22 142 101 7 16 2,761 2,885 E E Board and Sub-Board Members' fees and expenses Audit fee Depreciation (Note 7) Loss on disposal of tangible assets Board members’ fees are as follows: - - Mr. G. Brown 11,970 11,970 Mr. J. Bryan 11,970 11,970 - - Mr J. Comer 11,363 10,707 Mr. M. Cronin 11,970 11,970 Dr. N. Cawley - 8,445 5,837 11,970 10,937 11,970 Mr. M. Carey* Ms. M. Byrne** Ms. A. Dennison Mr. K. Dunne - - Ms. R. Holland 11,970 11,970 Mr. J. Horgan* - - Ms. C Keeling* - - Mr. J. Kingston 11,970 11,970 Prof. F. O'Gara 11,035 11,970 - 2,722 11,970 - 110,992 117,634 17,704 19,929 Mr. F. Hayes* Mr. M. O'Rourke Mr. B. Sweeney Total Board members’ travel and subsistence expenses * Indicates those Board members who have waived part or all of the fee payable, as a Board member, in 2013. ** No fees are payable to Ms. M. Byrne, Principal Officer, Department of Agriculture, Food and the Marine. 66 2013 Bord Bia Irish Food Board Annual Report 2013 Notes forming part of the Financial Statements Year ended 31 December 2013 7. Tangible Fixed Assets Improvements to Leasehold Property Furniture and fittings Computer equipment Office equipment Total Cost E’000 E’000 E’000 E’000 E’000 At 1 January 2013 1,704 616 575 211 3,106 2 19 79 Additions in year Disposals 100 (91) (29) (26) (30) (176) 1,615 606 628 181 3,030 1,673 545 505 182 2,905 9 39 80 14 142 (90) (25) (26) (28) (169) 1,592 559 559 168 2,878 At 31 December 2013 23 47 69 13 152 At 31 December 2012 31 71 70 29 201 At 31 December 2013 Depreciation At 1 January 2013 Charged in year Disposals At 31 December 2013 Net Book Amounts Bord Bia Irish Food Board Annual Report 2013 67 Notes forming part of the Financial Statements Year ended 31 December 2013 8. Debtors Amounts falling due within one year: Trade debtors Less: Provision for Bad Debts Prepayments and accrued income 9. 2013 2012 E’000 E’000 1,388 1,204 (669) ( 597) 719 607 1,261 1,612 1,980 2,219 1,588 1,430 905 1,299 Creditors (amounts falling due within one year) Trade creditors Exchequer pension contributions Taxation and social welfare (Note 10) 218 219 Withholding tax 325 306 2,319 2,285 661 1,652 6,016 7,191 151 154 67 65 218 219 Accruals Deferred Income 10. Taxation and Social Welfare Taxation and social welfare creditors comprise the following: Income Tax P.R.S.I. An Bord Bia is not liable to corporate taxes in Ireland or in the countries in which it operates because it is a non-commercial State-sponsored body. It is liable to employer taxes in Ireland and complies with related withholding, reporting and payment obligations in all countries in which it operates. 68 Bord Bia Irish Food Board Annual Report 2013 Notes forming part of the Financial Statements Year ended 31 December 2013 11. Provisions for Liabilities and Charges At 1 January 2013 Provided during year Released during year At 31 December 2013 E’000 E’000 E’000 E’000 31 - 583 - 614 - Value Added Tax Provision for Dilapidations 13 (18 ) 583 - 596 (18 ) The provision in respect of Value Added Tax relates to adjustments to amounts recovered from overseas jurisdictions in prior years. The provision for dilapidations comprises the estimated cost of reinstatement of leasehold properties in accordance with obligations under operating leases. 12. Commitments (a) Capital Commitments An Bord Bia had no capital commitments at the year end. (b) Financial Commitments There were no commitments in respect of Marketing Finance Programmes at the year end. (c) Operating Leases Operating leases comprise leases of premises. Leasing commitments payable during the next twelve months amount to €749,011 made up as follows: Payable on leases on which the commitment expires: E 40,612 Within one year Within two to five years 247,027 Six years and over 461,372 749,011 13. Contingent Liabilities Contingent liabilities exist in respect of amounts approved but unclaimed at the year end under the terms of the following Marketing Finance Programme operated by Bord Bia as follows: Marketing Assistance Programme 2013 2012 E’000 E’000 911 1,023 Management estimates the contingent liabilities under this heading will be settled within one year. Bord Bia Irish Food Board Annual Report 2013 69 Notes forming part of the Financial Statements Year ended 31 December 2013 14. Superannuation 2013 2012 a i) Pension costs E’000 E’000 Service cost 2,190 1,207 ( 315) (337) Current service cost 1,875 870 Interest cost 1,483 1,479 Total 3,358 2,349 Employee contributions a ii) Contribution to the Exchequer In accordance with the Financial Measures (Miscellaneous Provisions) Act 2009 and the arrangements set out in the accounting policies, contributions payable to the Exchequer amounted to €768,261 in the year (2012: €770,516). An amount of €904,820 was due at 31 December 2013 (2012: €1,298,733) in respect of employee deductions and contributions payable to the Exchequer after offsetting pensions payable under the Bord Bia scheme. a iii) Analysis of amount recognised in Statement of Total Recognised Gains and Losses Experience gains Changes in assumptions 3,314 1,116 947 (15,208) 4,261 (14,092) 42,143 26,117 2,190 1,207 b i) Present value of scheme obligations Present value of scheme obligations at beginning of year Service cost Interest costs Actuarial (gain)/loss Benefits paid Present value of scheme obligations at end of year 70 Bord Bia Irish Food Board Annual Report 2013 1,483 1,479 ( 4,261 ) 14,092 ( 709) (752) 40,846 42,143 Notes forming part of the Financial Statements Year ended 31 December 2013 14. Superannuation (Cont’d) b ii) Deferred Funding Asset Under the terms of the Financial Measures (Miscellaneous Provisions) Act, 2009, the assets of the Bord Bia Superannuation Schemes were transferred to the National Pension Reserve Fund with effect from 31 December 2009. The pension schemes associated with these funds continue in force for existing members with no impact on benefits or associated provision for members. The Department of Agriculture, Food and the Marine will provide funding where the pensions paid exceed the contributions. An Bord Bia has adapted the treatment and disclosures required by the accounting standard, Financial Reporting Standard 17 (Retirement Benefits) to reflect the arrangements in operation. While the funding arrangement operates on a net pay over basis with the Department, An Bord Bia believes the nature of the arrangement is akin to a full reimbursement of the pension liability when those liabilities fall due for payment and therefore recognises its right to the reimbursement as a separate asset in an amount equal to the liability at the year end. An Bord Bia also recognises an asset corresponding to the unfunded liability for pensions on the Bord Glas scheme on the basis of a number of assumptions and past events including the statutory basis for the establishment of the superannuation schemes, and the policy and practice currently in place in relation to funding public service pensions, including the annual estimates process. A deferred funding asset of €40.846 million equal to the pension liability is recognised at 31 December 2013 (2012: €42.143 million). The deferred funding asset at the year end was determined after taking into account Net Deferred Funding for Pensions in the year of €3.292 million and adjustments arising from the actuarial gain of €4.261 million and from pensions payable under the Bord Bia scheme of €642,620 which were offset against the contribution payable to the Exchequer. b iii) Net Deferred Funding for Pensions in Year Funding recoverable in respect of current year pension costs Oireachtas Grant-in-Aid applied to pension payments (An Bord Glas scheme) 2013 2012 E’000 E’000 3,358 2,349 ( 66) ( 61) 3,292 2,288 c) Description of schemes and actuarial assumptions The Board operates three defined benefit superannuation schemes for certain eligible employees. 1) The Bord Bia main scheme, for which the approval of the Minister for Agriculture, Food and the Marine and the Minister for Finance has been received. Until 31 December 2009, the contributions of employees and Bord Bia were paid into a fund managed by the trustees. As detailed under note 14b ii) above, the assets of the scheme were transferred to the National Pension Reserve Fund with effect from 31 December 2009. 2) The former Bord Glas scheme. This consists of a non-contributory defined benefit pension scheme and a contributory spouses and children’s scheme which is operated on an administrative basis pending the authorisation of the schemes by the Minister for Finance. 3) The Single Public Service Pension Scheme. The rules of the Single Scheme are set down in the Public Service Pensions (Single Scheme and Other Provisions) Act 2012. An Bord Bia meets the cost of current retirements. These are paid out of current income. Contributions received by An Bord Bia from members of the contributory unfunded schemes outlined above are used to part fund ongoing pension liabilities. An actuarial valuation of the Bord Bia Superannuation Schemes was carried out as at 31 December 2013 for the purpose of preparing this FRS17 disclosure. The liabilities and costs have been assessed using the projected unit method. Bord Bia Irish Food Board Annual Report 2013 71 Notes forming part of the Financial Statements Year ended 31 December 2013 14. Superannuation (Cont’d) Financial assumptions The principal actuarial assumptions used to calculate the retirement benefit obligations under FRS17 were as follows: 31/12/2013 31/12/2012 31/12/2011 Discount Rate 3.60% 3.55% 5.75% Inflation Rate 2.00% 2.00% 2.00% Salary increases 4.25% 4.25% 4.25% Pension increases 3.75% 3.75% 3.75% The following amounts were measured in accordance with the requirements of FRS17. Demographic assumptions The mortality table is 98% of PNML00 for males and 98% of PNFL00 for females, with the 2013 CSO mortality improvements applying from 2010. Representative rates are shown below: The expected lifetime of a participant who is age 65 and the expected lifetime (from age 65) of a participant who will be age 65 in 25 years are shown in years below based on the above mortality tables. Age Males Females 65 20.7 23.2 65 in 25 years 23.9 25.9 d) History of defined benefit obligations, assets and experience gains and losses 2013 2012 2011 2010 2009 E’000 E’000 E’000 E’000 E’000 Defined benefit obligations 40,846 42,143 26,117 24,751 23,169 Fair value of scheme assets - - - - - (40,846) ( 42,143) (26,117) (24,751) (23,169) 4,261 (14,092 ) 632 1,266 1,822 - - 1,239 Deficit on Superannuation Schemes Experience adjustments on scheme obligations Experience adjustments on scheme assets 72 Bord Bia Irish Food Board Annual Report 2013 - - Notes forming part of the Financial Statements Year ended 31 December 2013 15. Board Members – Disclosure of Transactions In the normal course of business the Board may approve grants and may also enter into other contractual arrangements with undertakings in which Bord Bia Board Members are employed or otherwise interested. The Board adopted procedures in accordance with the guidelines issued by the Department of Public Expenditure and Reform in relation to the disclosure of interests by Board Members and these procedures have been adhered to by the Board during the year. No grants were approved or paid during the year to companies with which Board Members are associated. 16. Premises An Bord Bia occupies premises at Clanwilliam Court, Lower Mount Street, Dublin 2 under a rental agreement. This agreement, which commenced in 2010, is for a period of ten years. The rental charge for 2013 was €378,370. In addition, the Board occupies ten other properties in various locations internationally. The total rent paid on these premises in 2013 was €375,373. 17. Approval of Financial Statements The Board approved the financial statements on 28th May 2014. Bord Bia Irish Food Board Annual Report 2013 73 Marketing Finance Grant Payments 2013 Company Abbey Nurseries Adare Farm Aines Chocolates Ltd Alan Kelly Tomatoes Golf Road Nurseries Amour Nurseries Annascaul Black Pudding Co. Ardee Sauces Ltd t/a Aruna Sauces Ardrahan Dairy Products Ltd Atlantic Marine Seafoods Ballykelly Farms Ltd Beal Organic Cheese Ltd Beechill Bulbs Ltd Beechlawn Organic Farm Beeline Health Foods Ltd Belvelly Smokehouse Big Red Kitchen Brookridge Farm Ltd Burren Smokehouse Ltd Caherbeg Free Range Pork Cahills Farm Cheese Ltd Carlow Craft Brewery Ltd Carr Shellfish Ireland Carrigaline Farmhouse Cheese Ltd Carrigbyrne Farmhouse Cheese Ltd Cathys Spelt for Health Celtic Chocolates Ltd Chia Booster Distribution Ltd t/a Chia Bia Cloon Potatoes Con Traas Ltd Connemara Fine Foods Ltd Connemara Seafoods Ltd Coolea Farmhouse Cheese Cooleeney Farmhouse Cheese Corleggy Cheese Country Cooking Co.Ltd Couverture Ltd Crossogue Preserves Cuinneog Ltd Cybercolors Ltd Dee's Wholefoods Ltd Delicious Gluten Free Bakery Deliciously Different Cake Co. Derrycamma Farm Doran Nurseries Ltd Dungarvan Brewing Co.Ltd Durrus Cheese Eden Farms Ltd Elite Cuisine Ltd Empire Donuts Everyday Foods Farm Fresh Homemade Foods Ltd Fermoy Natural Cheese Fior Uisce Fitzgerald Nurseries Ltd Flair Confectionery Froberry Ltd Glenbrook Nurseries Ltd Glenilen Farm Ltd Gran Clarkes Bakery ( D&S Gourmet Food) Green Earth Organics Ltd Green Edge Solutions Ltd Green Saffron Spices Ltd Greenbean Ltd Greenhill Fruit Farm Ltd G's Gourmet Jams Ltd Hickey's Bakery Ltd Hot Irishman Ltd Hughes Roses Ltd Hyde Ltd t/a Ballymaloe Country Relish Inagh Farmhouse Cheese Ina's Kitchen Desserts Ltd Inch House Traditional Black Pudding Irish Premium Oysters Island Seafoods Ltd Island View Nurseries J&L Grubb Ltd Jack & Keith Molloy Bros Ltd Jane Russell's Original Irish Amount € 2,772 5,000 6,000 3,800 1,454 1,512 8,000 8,852 3,780 3,418 3,000 2,287 1,030 4,000 480 1,499 4,000 9,000 3,630 10,000 12,000 20,264 9,000 10,469 2,000 14,131 4,000 4,000 5,000 6,000 10,000 788 15,000 5,974 5,000 5,246 3,000 3,111 18,000 5,000 9,989 5,000 2,515 3,572 4,000 3,230 8,000 2,000 2,000 6,000 2,200 2,165 2,821 23,378 3,000 2,000 8,132 20,000 3,000 1,168 6,941 6,000 5,276 8,000 7,000 1,626 7,000 1,268 30,000 10,000 12,000 1,928 4,000 4,070 4,400 35,017 2,000 5,000 Company Janet's Country Fayre Ltd JFS Produce Ltd Kearneys Homebaking Ltd Keeling F Juices Ltd Kelly's Nursery Ltd Kenmare Salmon Co Ltd Keogh's Crisps Ltd Kilfera Food Manufacturers Ltd Killeen Farmhouse Cheese Kinvara Smoked Salmon Ltd Knockdrinna Farmhouse Cheese Ltd Kohinoor-Emaan World Cuisine Kooky Dough Ltd Kush Seafarms 2011 Linnalla Ice Cream Lough Derg Chocolates Lovin Catering Ltd Man of Aran Fudge Mannings Bakery Mc Bride Fishing Company Meadowsweet Apiaries Ltd Michael Waldron Meats Ltd Mileeven Ltd Milleens Cheese Ltd MPB Foods Ltd Mr.Middleton Garden Shop Ltd Murphy's Ice Cream Ltd Natasha's Living Food Nightpark Nursery Noirins Bakehouse Ltd O'Connor Nurseries O'Connor's Confectionery O'Dowd Nurseries Oishii Foods Ltd On The Pigs back Paddy O's Granola Pandora Bell Paul Brophy Veg Ponaire Ltd Pottle Meats Ltd Pure Brazen Quarrymount Free Range Meat Rentes Plants Ltd Rosies Bakehouse Ryan's Farm Sam's Cookies Ltd Schram Plants Ltd Seavest Ltd Shannon Estuary Oysters Ltd Sillis Green Veg Limited Skellig Chocolates Ltd Slender Choice Ltd Solaris Botanicals Ltd Spanish Point Sea Veg Spice O'Life Ltd Springfield Nurseries Stams Bamboo Nursery Ltd Stonewell Cider Stuart and McLean Limited Sunshine Bread & Confectionery Limited Sushi King Taste a Memory Foods The Food Store The Foods of Athenry The Just Food Co The Little Milk Company The Scullery The Tipperary Kitchen Tipperary Organic Ice Cream Ltd Una O'Dwyer Ltd Wexford Home Preserves White Gypsy Brewery Wicklow Farmhouse Cheese Ltd Wicklow Fine Foods (Chocolate Garden) Wild Orchard Natural Beverages Yawl Bay Seafoods Ltd Zanna Cookhouse Total 74 Bord Bia Irish Food Board Annual Report 2013 Amount € 7,747 4,000 3,000 5,221 4,000 7,000 8,000 9,000 4,943 4,152 5,000 11,552 1,884 5,617 3,000 1,000 1,341 1,500 12,000 10,000 1,134 11,801 9,000 2,411 3,000 8,000 3,000 4,000 6,594 1,948 2,500 3,000 2,089 2,687 3,000 3,660 2,000 4,000 4,000 1,446 282 3,000 4,872 2,268 948 9,558 841 3,424 4,886 12,000 4,000 4,000 5,000 3,244 8,000 2,928 4,168 5,000 3,000 4,000 3,000 4,968 3,000 12,000 2,539 3,000 4,000 2,650 984 4,879 2,000 1,515 7,000 7,000 3,765 3,500 3,000 850,639 Bord Bia offices Head Office Amsterdam Moscow Clanwilliam Court Lower Mount Street Dublin 2, Ireland T +353 1 668 5155 F +353 1 668 7521 World Trade Centre Strawinskylaan 1351 1077 XX Amsterdam The Netherlands T +31 20 754 6969 F +31 20 754 6961 Orlikov per, 3B Moscow 107139 Russia T +7 495 607 8150 F +7 495 607 8460 Dubai 4th floor, Office 4b, Monarch Office, Tower No 1, Sheikh Zayed Road, PO Box 1115425, Dubai, United Arab Emirates Dusseldorf Derendorfer Allee 6 40476 Dusseldorf Germany T +49 211 470 5975 F +49 211 470 5976 London 201-203 Great Portland Street London W1W 5AB United Kingdom T +44 20 7307 3555 F +44 20 7307 3556 Madrid Casa de Irlanda Paseo de la Castellana No 46 - 3a planta 28046 Madrid Spain T +34 91 435 6572 F +34 91 435 6211 New York Ireland House 345 Park Avenue 17th Floor New York NY 10154-0037 USA T +1 212 935 4505 F +1 212 935 4385 Paris Maison d’Irlande 33, rue de Miromesnil 75008 Paris France T +33 1 42 66 22 93 F +33 1 42 66 22 88 Shanghai (Asia Office) Suite 733 Shanghai Centre No. 1376 Nan Jing Xi Road Shanghai 200040 China T +86 21 627 98829 F +86 21 627 98849 Stockholm Embassy of Ireland Hovslagargatan 5 11148 Stockholm Sweden T + 46 8 545 04058 Milan Via E. De Amicis, 53 20123 Milano Italy T +39 02 7200 2065 F +39 02 7200 4062 Bord Bia Irish Food Board Annual Report 2013 75 Head Office: Clanwilliam Court, Lower Mount Street, Dublin 2, Ireland. T +353 1 668 5155 F +353 1 668 7521 E info@bordbia.ie www.bordbia.ie Growing the success of Irish food & horticulture