Brexit bites as food, drink exports to EU fall 24%

UK exports of food and drink are down £2.7 billion or 15.9% in the first three quarters of 2021 compared to pre-pandemic levels, according to the latest statistics from the UK’s Food and Drink Federation (FDF).

This is largely due to a drop in sales to the EU of £2.4 billion or 23.7% resulting from new barriers to trade with the EU following Brexit and the ongoing effects of the COVID-19 pandemic.

Exports of whisky and salmon have “started to recover” with sales of both products up 21% compared to 2020.

However, whisky exports of £3.7 billion in the first three quarters of 2021 are still down 11% on 20219 levels and salmon exports of £607.1 million are still down 6.4% on 2019 levels.

Whisky and salmon are the UK’s two biggest food and drink exports.

“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,” said the FDF.

“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 also 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, 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,” said the FDF.

Dominic Goudie, Head of International Trade at 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.”

About the Author

Mark McSherry
Dalriada Media LLC sites are edited by veteran news journalist Mark McSherry, a former staff editor and reporter with Reuters, Bloomberg and major newspapers including the South China Morning Post, London's Sunday Times and The Scotsman. McSherry's journalism has also appeared in The Washington Post, The Guardian, The Independent, The New York Times, London's Evening Standard and Forbes. McSherry is also a professor of journalism and communication arts in universities and colleges in New York City. Scottish-born McSherry has an MBA from the University of Edinburgh and a Certificate in Global Affairs from New York University.