Can Irish dairy exports withstand Middle East volatility?
Demand in some key Middle East markets for Irish exporters "remains resilient" but it could hit a "tipping point", Bord Bia warned today (Monday, May 18).
As the current conflict in the Middle East enters day 79, the impact of "severe logistics disruption, rising costs, and weakening consumer confidence" is, according to Bord Bia, putting "sustained pressure on demand for imported food".
Kieran Fitzgerald, Bord Bia's Middle East and Africa manager, told Agriland that "business continues to function across the region, but under increasingly complex logistics conditions".
"Sea freight disruption remains severe, with many shipments rerouted via the Cape of Good Hope, extending transit times and increasing costs.
"Alternative ports in Saudi Arabia, Jordan, Oman and the United Arab Emirates (UAE) are operating significantly above capacity, with delays of up to 10 days to berth, alongside additional road transport requirements across Gulf Cooperation Council (GCC) and Iraqi markets.
"These alternative routes are more complex, costly, and operationally challenging. Freight costs across both air and sea remain elevated, with higher energy prices feeding into wider inflation across the supply chain," Fitzgerald said.
According to Bord Bia's Middle East and Africa manager, transport and logistics continue to represent the most acute operational risk for Irish exporters.
Middle East
Bord Bia has estimated that Irish food and drink exports to the Gulf region amounted to €370 million last year.
In 2025 dairy exports from Ireland increased by 7% to €315 million while prepared consumer foods grew by 17% to €26.8 million.
A month before the conflict erupted in Iran on February 28, Irish food and drink exporters had taken part in a trade mission to the UAE.
At the time the Minister of State for Agriculture, Food and the Marine, Noel Grealish, had said that the Middle East was "a priority growth market for Irish food and drink exports, driven by population growth, a strong tourism sector and the region’s role as a global food and logistics hub".
But the current outlook for this "priority" market is growing increasingly worrying.
If the conflict in Iran continues to send shockwaves throughout the Middle East economies, then what will this mean for Irish exports?
According to Fitzgerald, if current conditions persist, "there is a clear risk of a tipping point as sustained cost increases begin to weaken demand more materially".
He said foodservice in the UAE is under "acute pressure in what is one of the world’s most competitive restaurant markets, with more than 13,000 outlets and among the highest restaurant density globally".
"Demand has dropped sharply, with operators implementing cost-cutting measures including reduced hours and staffing.
"In Saudi Arabia, demand remains relatively resilient overall, supported by a large domestic population and continued social dining behaviour," Bord Bia's Middle East and Africa manager warned.
At the same time according to Fitzgerald, demand in some markets "remains resilient".
"Saudi Arabia and Iraq continue to show steady demand for key categories such as dairy ingredients used in local production.
"Gulf food security is partially supported by strategic stockpiles, helping mitigate immediate supply shocks.
"However, consumer-facing sectors – including foodservice, retail, tourism, and aviation-linked demand – remain vulnerable to confidence shocks and population movements," he added.
