Record first half for UK food and drink exports

Record first half for UK food and drink exports
Credit: Shutterstock.com/ hxdyl

Exports of UK food and drink have achieved their highest first half value on record, reaching £10.2 billion.

This represents an 8.5% rise on the same period last year. It follows 2017 having the best first quarter on record.

Unsurprisingly, the UK’s top three export producers are whisky, salmon and beer.

Despite recent reports, there has been a 9% increase in exports to EU countries, compared to the 7.6% rise to countries outside the EU.

Overall, the top three destinations for food and drink (in terms of overall value) were Ireland, France and the US.

Positive growth was reported in all top 20 markets – apart from Spain and Japan.

Although Japan was down by 2%, Spain saw a dramatic decline of 17.6% due to a drop in commodity exports (such as wheat and barley).

The export markets that saw the greatest percentage growth during this period were Sotuh Korea, China and Belgium.

This rapid growth in East Asia was led by the growing thirst for British beer in South Korea.

The US is the UK’s top non-EU market for exports of branded food and drink, with exports reaching £91.5 million for the first half of the year.

Top branded good sold to the US during this period included food preparations, bread, pasty, cakes, puddings and sweet biscuits.

The Government has identified the US as providing significant opportunities for a trade deal post-Brexit.

While the fall in the price of the pound had helped to boost UK export competitiveness, this weakness has also led to an increase in the cost of many essential imported ingredients and raw materials.

This has resulted in the UK’s food and drink trade deficit increasing by 16% to -£12.4 billion in H1 2017.

The Food and Drink Federation recently commissioned Grant Thornton to undertake an economic contribution report.

It identified China (£274.3m in H1), India (£50.7m in H1) and the UAE (£164.8m in H1) as the top 3 target markets that food and drink companies would like to target.

These countries were prioritised by the companies surveyed based on their scale which affords a sizeable middle class target customer base with strong and growing demand for quality Western products.

“It is great to see such strong growth in our exports to EU Member States,” said FDF Director General Ian Wright.

“The EU remains an essential market for UK exports as well as for supplies of key ingredients and raw materials used by our industry.

“We believe there are significant opportunities to grow our sector’s exports further still.”

Food Minister George Eustice MP said: “These encouraging figures show that the UK’s high quality foods and high standards are sought after around the world.

“We have ambitious plans to produce and export more of our fabulous foods around the world and more businesses are trying exporting for the first time.”

The Government recently announced a new export deal for British pork in China.