News article
20 September 2019
Food and Drink Federation: Continued access to EU preferential trade agreements vital to avoid significant drop in exports
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- The UK Government has now secured continuity deals for 15 existing EU
preferential trade
agreements out of a total of more than 40. This represents 43% of the UK's
exports to nations where
there is an existing trade agreement – over £650m of a total of £1.5bn in H1
2019.
- The Food and Drink Federation's (FDF) latest export statistics show that in the
first half of 2019,
UK exports of food and drink increased by 5.1% to £11.3bn - lower than the H1
2018 growth rate of
5.7%.
- The value of branded food and drink exports to the EU has declined (-1.6%)
whilst exports of
these goods to non-EU countries have risen by almost 10%.
- All of the UK's top ten exported products have risen in value in H1 2019, with
half of these
increasing by over 10% on the same period last year.
The Food and Drink Federation (FDF) has published a report today showing that food and
drink exports have increased by 5.1% to £11.3bn in H1 2019 compared to the same
period in 2018.
Yet the rate of growth is lower than that seen in H1 2018 of 5.7%.
FDF is urging Ministers to make further progress in securing continuity deals
for EU preferential
trade agreements. To date, just 15 of more than 40 deals have been successfully
concluded. This
represents 43% of the UK's food and drink exports to nations where there is an
existing trade
agreement – £650m of a total of £1.5bn in H1 2019.
Growth in H1 has been driven by a strong increase in the value of exports to
non-EU countries
(+9.8%). The year-on-year increase in value of non-EU exports is almost three
times that of exports
to EU countries.
Having seen growth of 10.7% in Q1 2019 driven by stockpiling in EU27 countries
ahead of the
April Brexit deadline, export growth fell in Q2. The subsequent slowdown in
sales to the EU in Q2 is
in part driven by the need for businesses to sell off these stockpiled goods.
The value of branded goods sold to the EU has declined (-1.6%) whereas exports
to non-EU
countries have risen by almost 10%. As a result, the share of both branded and
non-branded food
and drink sold to the EU has declined in H1 2019. This decline has been notable
in the UK's largest
export market, Ireland, where the value of branded goods fell by 2.5% in H1.
Exports of all the UK's top 10 food and drink products have increased in H1
2019, with the value
of whisky, salmon, wine, gin, and pork exports all up more than 10% on the same
period last year.
Salmon, beef and gin have also all seen volume growth of more than 10%.
EU Preferential Trade Agreements
UK businesses currently benefit from more than 40 trade agreements with 76
countries as a
member of the EU. Each of these are important for UK food and drink exporters
and importers.
Exports to these countries were worth £3.1bn in 2018, which represents 14% of
total UK food and
drink exports.
The highest-value product category sold via EU preferential trade agreements is
'beverages,
spirits, and vinegars', which accounted for 48% of UK exports to these markets
in 2018.
These partner countries are also an essential source of imported raw materials
and ingredients
that are not produced in the UK and complement our industry's use of UK
produce.
Imports from
these markets totalled £6.7bn in 2018. Edible fruit and nuts was the top import
product category
worth £2.3bn in 2018.
Loss of access to EU preferential trade agreements is a concern of our members
that has
consistently been highlighted in quarterly
business confidence surveys. FDF has produced a wide-range of guidance to support
its
members and wider industry preparations for a potential no-deal Brexit. These
are available via
FDF's Brexit Roadmap and our contributions to the joint-industry produced Food Hub.
Ian Wright CBE, Chief Executive, Food and Drink Federation, said:
“UK food and drink exports continue to grow despite our troubled times. FDF has
serious
concerns that the UK faces the loss of essential market access to a wide range
of EU trade deals in
the event of a 'no-deal' Brexit. This will undermine our impressive export
performance. It will also
restrict our access to essential ingredients and raw materials.”
“Government must deliver on its promise to ensure there is no loss of access to
any of these
agreements after the UK leaves the EU. The failure to secure continuity
agreements with these
markets will place UK manufacturers at a competitive disadvantage to EU
competitors. That will harm
the interests of UK consumers.”
Notes for editors:
- The Food and Drink Federation (FDF) is the voice of the food and drink
manufacturing
industry – the UK's largest manufacturing sector. For more information about
FDF
and the industry
we represent visit: www.fdf.org.uk.
- 'Branded' goods refer to manufactured products that have had their value
increased through
production. FDF's focus in terms of branded goods is on food and non-alcoholic
drink.
- The exports report can
be found
here.
- Supporting case studies
can be found
here.
- The latest FDF Food & Drink
Business
Confidence Survey can be found here.
- More information about the Brexit
Roadmap can be found here.
- Information about the Food Hub can be found
here.
More Information
Contact Megan Bevan, Corporate Affairs Division, at: Megan.Bevan@fdf.org.uk, or 07525717882.
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