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Spirits exports up in 2024 but tariffs loom for producers

The US continues to be the biggest destination for Irish spirits - but Drinks Ireland says tariffs will put producers at a disadvantage there
The US continues to be the biggest destination for Irish spirits - but Drinks Ireland says tariffs will put producers at a disadvantage there

Exports of Irish spirits continued to rise last year, according to the 2024 Annual Report from Drinks Ireland Spirits.

Volumes were up 2.8% in the year - more than reversing the slight decline in exports in 2023.

Values grew at a faster pace, though the group said this was largely due to inflation across the supply chain.

The US continuing to be the biggest destination for Irish spirits, according to Drinks Ireland. But with a 15% tariff now in place, producers are likely to be at a disadvantage to distillers in other countries.

"The producers that I represent, who make Irish whiskey, Irish gin, Irish cream, they're going to find it very hard not to pass on at least some of that tariff increase in the form of price rises to consumers in the States," said Aengus King, director at Drinks Ireland Spirits. "The reason that that is such a big problem is because a lot of our competitors won't actually have any tariffs.

"US whiskey, Canadian whisky, spirits coming from Mexico - even British spirits will have a lower tariff that what we from Ireland and Europe will have."

The uncertainty around US exports led some distillers to halt production earlier this year. Many companies are now under significant pressure - however Mr King said there is also a determination among producers to find a way to manage the current challenges.

"There's a steely determination in order to try and make it through this very difficult period," he said. "While there have been one or two closures and certainly producers pausing production - particularly at the beginning of the year - I don't foresee a huge number of closures going forward."

One potential target for spirits makers here is India - which has seen a rapid growth in demand for Irish whiskey, albeit from a low base.

Exports of whiskey rose by 57.5% last year, according to Drinks Ireland, with India now the fifth biggest buyer of the drink.

The UK and Germany were also major importers of Irish spirits.

In Ireland, meanwhile, spirits sales continued to decline - with Mr King said was a reflection of the broader fall in alcohol consumption here.

"It reflects the trend of people drinking less," he said. "But while they might be drinking less in volume, they are drinking better. So the value would still be quite good."

Drinks Ireland has called for an excise cut in Budget 2026, though Mr King said it would remain to be seen whether such a move would lead to a reduction in retail prices - or would be used to boost producers' margins.

The group also wants the Government to continue to push for a return to the zero tariff arrangement that had previously been in place for drinks exports to the US.