Irish food and drink exports grew by 5 per cent last year to a record €8.62 billion, but the extra €414 million in sales was only half of the record €800 million returned in 2006.

According to Bord Bia chief executive Aidan Cotter, the 2007 performance was all the more impressive when viewed against the strengthening of the euro against the dollar and sterling, higher operation and ingredient costs.

One of the most impressive facts in the board's Performance and Prospects report was the rise of almost 50 per cent in exports to Asia, where the value of the trade reached €400 million.

This, according to Mr Cotter, has meant that the Government target for food and drink exports to the region had been met two years ahead of schedule and was now 80 per cent ahead of 2002 levels.

"The growth in trade here reflects the rise in the value of dairy and beverage exports to the region and a marked diversification by the industry to a wider range of Asian countries. It accounted for as much as one-third of the increase in total exports," he said.

The export growth was driven primarily by the dairy industry, where a 13 per cent increase in exports amounted to more than €270 million or 65 per cent of the total rise in food and drink exports, and 50 per cent of the growth in dairy exports came from Asian markets.

The weakness in European markets resulted in Irish meat exports falling by 3 per cent to €2,38 billion and beef, which makes up the largest component of the sector, fell by 2 per cent in value despite a small volume increase.

Mr Cotter said beef exports last year stood at €1,570 million but it was important to note that 98 per cent of beef exports were now destined for European markets, even though prices weakened at the end of the year and market returns came under pressure.

He predicted that restrictions being placed on Brazilian beef exports to the EU, which had been suppressing beef prices here, presented an opportunity of better returns from the market after mid-March, when only 300 Brazilian farms will be allowed to export into the EU.

The value of Irish pigmeat exports fell by 5 per cent last year to €212 million because of a difficult market environment and there was an 8 per cent fall in sheepmeat exports to an estimated €174 million.

Poultry exports increased by 5 per cent, on foot of increased broiler output combined with higher prices, to a level of €253 million.

Prepared-food exports performed well with a 6 per cent growth to €1.185 billion, as did mushroom and cereal exports which increased by 18 per cent to €259 million.

Mr Cotter said the 6 per cent growth in beverage exports to €1.45 billion was driven by a more than doubling of alcohol exports to Asia, where there was strong growth for cream liqueurs, whiskey and stout in China and a recovery in import demand for whiskey in Japan.

On the prospects for this year, Mr Cotter said the solid export performance of last year had been underpinned by the upward pressure on global food prices, which looked set to remain a feature of the international marketplace in 2008 and beyond.

"The high export orientation of the sector, accounting for 10 per cent of the country's merchandise exports, means it is well positioned to exploit these global trends and maintain its contribution to Ireland's economic performance."