UK food and drink sees a significant and persistent drop in exports
16 December 2021
UK exports of food and drink are down £2.7bn (-15.9%) in the first three quarters of 2021 compared to pre-pandemic levels. This is largely due to a drop in sales to the EU of £2.4bn (-23.7%) resulting from new barriers to trade with the EU and the ongoing effects of the COVID-19 pandemic.
Exports to core markets including Germany (-44.5%), Italy (-43.3%) and Spain (-50.6%) have been particularly badly hit since 2019, while UK exports to Ireland – the industry’s biggest overseas market – are down more than a quarter since 2019. This represents a loss of nearly £0.75bn in sales.
Global exports of whisky and salmon have started to recover, with sales of both products up 21% compared to 2020. All other major products, including beef (-18.4%), cheese (-13.2%) and pork (-5.7%) have continued to decline, with the exception of soft drinks which grew 11% from 2020.
More positive news can be seen in non-EU markets in the past year, with exports up 11%, driven by a return to strong growth in China (+22.1%), Taiwan (+21.8%), the UAE (+18.3%), Japan (+10.6%) and Singapore (+5.4%).
Imports have been badly impacted since 2019, with sales from the EU down nearly 11% in the nine months to September compared to pre-COVID levels – a fall of more than £2.5bn. Imports from the Netherlands (-19%), Ireland (-20.1%) and Germany (-33.1%) were most severely hit over the last two years.
With the UK due to implement its delayed import controls on products arriving from the EU in 2022, this will further impact the cost and availability of supplies of food and drink from the EU, including essential ingredients and raw materials required by UK manufacturers.
Dominic Goudie, Head of International Trade, the FDF, said:
“It is extremely disappointing to see how badly our trade with the EU has been affected, with our smallest exporters hardest hit. It is essential that the Government works constructively with the EU to improve the implementation of the Trade and Cooperation Agreement to ensure that it works for small businesses, otherwise this downturn will be here to stay.
“The UK Government’s recent announcement of plans to take forward the FDF’s proposals to set up a new Food and Drink Export Council and put in place new in-market support are welcome. It is vital that the UK Government and devolved nations continue to work with industry to put in place a new model of partnership to support food and drink exporters.
“Food and drink, from farm-to-fork is uniquely placed to deliver on the Government's levelling up agenda, delivering jobs and growth in every part of the UK. However, our supply chains continue to struggle, particularly through a lack of available workers. Businesses want to help the Government realise its Global Britain ambitions, but they need Government to clear the obstacles and help them take advantage of new opportunities.”
John Whitehead, Food & Drink Exporters Association (FDEA), said:
“The much-needed bounce back for salmon, whisky and soft drink exports is a real boost for the industry. It’s also encouraging to see meat sales to ASEAN countries rising driven by an increasing demand for pork. Our In Market Associates in both ASEAN and GCC markets report that there is also strong demand for added value products from the UK. It is the SME producers of value-added products hit hard by both Brexit and the pandemic who continue to need support to take advantage of these opportunities.”
For more information, please contact Meg Bevan, Corporate Affairs Executive, on 07946 340 998, Megan.Bevan@fdf.org.uk
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:fdf.org.uk
- Given the notable impacts of the Covid-19 pandemic on exports in Q3 2020, in this report we have also compared our data to Q3 2019, which we have used as a "benchmark" quarter and to check recovery.
- ‘Branded’ goods refer to manufactured products that have had their value increased through production. The FDF’s focus in terms of branded goods is on food and non-alcoholic drink.
- The exports report can be found here: https://www.fdf.org.uk/fdf/resources/publications/trade-reports/trade-snapshot-q3-2021/
- The FDF’s Export Guide (produced with the FDEA and AHDB) can be found here: https://www.fdf.org.uk/publicgeneral/five-steps-to-success-guide.pdf
- The latest FDF Food & Drink Business Confidence Survey can be found here: https://www.fdf.org.uk/globalassets/business-insights-and-economics/business-confidence/fdf-business-confidence-survey-2021-q3.pdf
- The FDF’s Supply Chain Disruption Briefing can be found here: https://www.fdf.org.uk/fdf/resources/publications/guidance/fdf-briefing-supply-chain-disruption/
- Food & Drink Exporters Association (FDEA) is the UK’s trade association for the food and drink export community. FDEA helps members grow their sales overseas by providing practical export support, lobbying government on industry issues and connecting UK suppliers to the international buying community. The community works together to share knowledge, contacts and advice. Find more here: ukfdea.com