UK F&B exports to Europe plummet amid COVID-19 and post-Brexit trade barriers

17 Dec 2021 --- UK food and drink exports have declined by £2.7 billion (US$3.6 billion), representing a 15.9% drop in the first three quarters of 2021, compared to pre-pandemic levels. However, there has been a bounce-back for salmon, whisky and soft drink exports, according to the Food and Drink Federation (FDF).

This is mainly due to a 23.7% drop in sales to the EU representing £2.4 billion (US$3.2 billion) 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, says the FDF. 

Meanwhile, UK exports to Ireland are also down more than a quarter since 2019. 

Significant products, including beef, cheese and pork, have declined, except for soft drinks, which grew 11% from 2020.Which exports are going well?
Global exports of whisky and salmon have started to recover, with sales of both products up 21% compared to 2020. 

All other significant products, including beef (-18.4%), cheese (-13.2%) and pork (-5.7%), have continued to decline, except for 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%).

Adverse impacts
Imports have poorly been impacted since 2019, with sales from the EU down nearly 11% in the nine months to September compared to pre-COVID levels. This is a fall of more than £2.5 billion (US$3.3 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 F&B supplies from the EU, including essential ingredients and raw materials required by UK manufacturers.

Downturn here to stay?Global exports of whisky and salmon have started to recover, with sales of both products up 21% compared to 2020.
It is extremely disappointing to see how badly our trade with the EU has been affected, with our smallest exporters hardest hit, says Dominic Goudie, head of international trade at the FDF. 

“The Government must work 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 new models in place to support food and drink exporters,” he continues.

Farm-to-fork supply chains continue to be hit due to a lack of available workers. 

“The much-needed bounce back for salmon, whisky and soft drink exports is a real boost for the industry. It’s also encouraging to see meat sales to ASEAN countries rising, driven by an increasing demand for pork,” adds John Whitehead from the Food & Drink Exporters Association (FDEA).

Edited by Gaynor Selby

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