Record Growth for UK Food and Drink Exports in First Quarter

The first quarter of 2017 saw exports of all UK food and drink grow to £4.9bn, up 8.3 per cent on 2016. Export growth to non-EU countries (+9.4 per cent) increased at a faster rate than those to the EU (+7.4 per cent).

The top three destinations for UK food and drink in terms of overall value were Ireland, France and the United States. Positive growth was reported in all top 20 markets apart from Spain, which saw a 21.6 per cent decrease compared with 2016.

The three export markets that saw the greatest percentage growth in value in the first quarter were South Korea (+40.3 per cent), Belgium (+37.3 per cent), and South Africa (+31.2 per cent). Beer was the key driver in export growth to South Korea, while wheat and barley were behind the rise in Belgian exports, and animal feed boosted those to South Africa.

Exports of salmon saw the largest value growth, up 52.3 per cent in the first quarter, with wine experiencing the largest increase in terms of export volume, up 13.8 per cent.

The FDF noted that while the fall in the price of the pound had helped to boost UK export competitiveness, this currency 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 19 per cent to -£6.2bn in the first quarter of 2017. The impact of weaker sterling on British exports is expected to be seen in the third quarter of 2017 as companies negotiate new sales agreements with overseas buyers.

Ian Wright, director general of FDF said, “The growth of food and alcoholic drink exports we’ve seen in Q1 is very encouraging news for our industry. We want to work with government to take advantage of increased demand for UK products overseas and the opportunities that leaving the EU is expected to create. We would encourage the new government to look to Bord Bia (the Irish Food Board) as inspiration in creating an organisation to help turbocharge sales of UK food and drink globally.

“It is also very pleasing to see non-EU exports performing beyond expectations. As the UK leaves the EU growth in exports is hugely important to our sector. We hope that with the determination of businesses and the assistance of the new government, we can open more channels and provide a further boost to the UK’s competitiveness on the world market.”