Tuesday, June 15, 2021

COVID leads to decline in British food & drink exports

Food and drink experts fell by 11.6% to £5.5 billion compared with the same period in 2019, according to new analysis published by the Food and Drink Federation (FDF).

The decline was largely driven by the impacts of COVID-19, including the closure of hospitality and travel sectors, which has meant a loss of sales into restaurants, cafés, bars and the out-of-home sector across Europe.

In the first nine months to September 2020, food and drink exports fell to £15.2bn (-12.9%) when compared to the same period in 2019. Exports to the majority of the top 20 markets decreased, with sales to Spain falling significantly by -33.8%.

However, exports to Norway experienced the most substantial increase, rising by 38.4% to £198.8m. When looking at UK export products, pork and breakfast cereals were the only products within the top 10 to show growth, up 12.7%, and 2.5%, respectively.

As the UK approaches the end of the transition period, the EU remains a key commercial partner, with over 60% of food and drink exports heading to EU markets. Within the top five products exported to the EU, whisky sales suffered the most, experiencing a reduction of 19% to £901.4m from January to September.

Ireland was the top EU destination for food and drink exports, making up almost 30% of overall sales in the EU, reflecting the close integration of UK and Irish food and drink supply chains.

Ireland has been a key export market for the UK, particularly over the past 10 years, totalling around 18% of total sales during that time period. Most of the top 10 products exported to Ireland fell in value terms, with cheese and savoury snacks the only categories to show growth.

Maintaining these highly integrated supply chains across Great Britain, the Republic of Ireland and Northern Ireland as we leave the EU will be essential for future growth in our industry.

“The continued decline in exports in the third quarter of 2020 shows the immense dilemma that UK food and drink exporters are currently facing. With less than one month to go, businesses are still in the dark about what arrangements will be in place following the end of the transition period in January 2021,” said Dominic Goudie, Head of International Trade, FDF.

“As the UK makes it way towards economic recovery, ensuring a quick return to growth will be essential to strengthen resilience in our industry. It is vital that we continue to work closely with Government and industry partners to ensure that food and drink exporters have the support they need.

“Today’s news of the launch of Open Borders Direct® is a most welcome development and promises to deliver urgently needed support for UK SMEs, helping them to safely navigate key crunch points when trading overseas.”

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