The Food and Drink Federation (FDF) has reported that UK exports of food and drink are down £2.7 billion (-15.9%) in the first three quarters of 2021 compared to pre-pandemic levels.
The FDF has revealed that UK food and drink exports has seen a significant and persistent drop in exports. This has been put down largely to a drop in sales to the EU of £2.4 billion (-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 £0.75 billion in sales.
However, the organisation states that 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 £2.5 billion. 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, the FDF predicts 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.”
Dominic continued: “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.”