Sentiment among food and drink manufacturers is “broadly positive” but will probably weaken in the months ahead as costs increase, according to a manufacturing report published by Food Drink Ireland (FDI).
FDI, which is affiliated to business representative group Ibec, said its 2025 manufacturing report, Appetite for Growth, found that 58 per cent of companies in the sector rated the manufacturing environment in the Irish market as good or very good.
However, this is lower than the 70 per cent positive response rate across all manufacturing sectors, while sentiment among food and drink manufacturers also weakens slightly when they are asked about the months ahead.
This is because about three-quarters of respondents (76 per cent) said they expected wage costs to climb, while the same proportion said sustainability investment and raw material costs would rise.
‘Copenhagen is like Disneyland compared to Munich: moving here immediately resonated with me’
Nvidia and the magnificent seven continue to drive markets
Who needs an iSmell? Nevada’s CES offers a tantalising view of the future
Shorla Oncology co-founders: ‘We felt compelled to do something meaningful’
The cost of investing in digitalisation and transport is also expected to increase by 62 per cent of companies.
Just over half of food and drink manufacturers (52 per cent) are expecting or planning for increased export sales this year, after exports from the sector reached a record value of €17 billion in 2024.
Some 38 per cent said sales in the domestic market would increase, while 43 per cent expect profitability to improve in the months ahead.
Meanwhile, 52 per cent of food and drink respondents expect an increase in productivity in the coming months and 48 per cent are planning to adopt or enhance existing AI initiatives, primarily with a view to improving efficiency and productivity.
FDI urged the incoming government to help manufacturers develop strong talent pipelines after a boost to the National Training Fund in Budget 2025.
It also said reducing energy costs and protecting businesses from rising costs, including by introducing a PRSI rebate for exposed companies, should be among the priorities for the programme for government.
“As deliberations continue on the programme for government, it is critical that policy can support the sector address its competitiveness challenges and harness opportunities for further growth,” said Food Drink Ireland director Paul Kelly.
- Sign up for the Business Today newsletter and get the latest business news and commentary in your inbox every weekday morning
- Opt in to Business push alerts and have the best news, analysis and comment delivered directly to your phone
- Join The Irish Times on WhatsApp and stay up to date
- Our Inside Business podcast is published weekly – Find the latest episode here
