UK: Food and drink exports rise nearly 15 percent
24 Nov 2017 --- Exports of all UK food and drink grew to £5.9bn (US$7.8 bn) in the third quarter of 2017, up 14.7 percent compared with 2016 and representing growth of 11 percent to £16.1bn (US$21.4 bn) from January to September 2017 year to date (YTD) compared to 2016.
Q3 export growth to non-EU markets (+18.2 percent) outperformed that to EU markets (+12.5 percent), raising the non-EU share of exports to 41.2 percent.
The UK's top three fastest-growing export products are liquid milk and cream, butter and spreads, and vegetable oils for the period from January to September.
The five fastest-growing export markets by value (YTD 2017) were the Philippines (+289 percent), Latvia (+116 percent), Iceland (+73.2 percent), South Korea (+55 percent) and Romania (+48 percent) for the period January to September.
The surge in growth to the Philippines was led by higher demand for pork (85 percent), whisky (277 percent), cheese (1608 percent) and salmon (226 percent), while exports to Latvia more than doubled from £60m (US$80 million) to £129m (US$171 million), driven by sales of whisky (131 percent), wine (239 percent), gin (86 percent) and fish fillets (125 percent).
Exports of branded goods saw growth of 12.7 percent to £4.3bn (US$5.7 bn) YTD 2017, demonstrating strong progress towards achieving FDF's branded export ambition ahead of schedule.
The third quarter saw further growth, building on the strength of the record-breaking first half results seen earlier this year.
FoodIngredientsFirst reported how the first quarter of 2017 saw exports of all UK food and drink grow to £4.9billion (US$6.5 billion) which represents the largest first-quarter exports value on record.
Top destinations
From January to September, Ireland, France and the United States remained the top three destinations for UK food and drink in terms of overall value. The US remains the UK's top non-EU market for exports of food and drink, reaching £1.6bn (US$2.1 bn), up 7.7 percent. Growth was reported in all top 20 markets during that time period, apart from Spain, which saw a 7.1 percent decrease due to reduced sales of barley and wheat (-78 percent).
The balance between exports to non-EU and EU markets shifted slightly in the third quarter, with growth to non-EU markets (+18.2 percent) outperforming EU markets (+12.5 percent).
Exports of branded products grew by 14.3 percent in Q3, reaching £1.5bn (US$2 billion), and up 12.7 percent to £4.3bn (US$5.7 billion) for the first nine months of the year. This means branded export growth is firmly on track to reach FDF’s export ambition ahead of schedule.
In 2015, FDF set a target to grow exports of branded food and non-alcoholic drink by a third, from a 2014 baseline, reaching £6bn (US$8 billion) by 2020.
Despite the growth recorded, the UK’s food and drink trade deficit increased by 0.7 percent to £5.6bn (US$7.4 billion) in Q3 2017 as the trade deficit with EU countries widened.
As part of the Government's Industrial Strategy, FDF is developing sector deal proposals to boost specialist export support for the industry, with an aim of delivering ambitious long-term export targets for the industry.
Exports were highlighted as an area of opportunity for manufacturers in the economic contribution report conducted by Grant Thornton. In the report, China, India and the UAE emerged as the top three markets that exporters would like to target, however food and drink businesses continue to struggle to enter these markets due to complexities, cost and unfamiliarity.
“The continued growth of food and drink exports demonstrates the strength of UK production in international markets. UK food and drink is recognized throughout the world for its quality and we must be ready to take advantage of the opportunities created from leaving the EU,” says Ian Wright CBE, Director General, FDF.
“Exports to non-EU markets did outperform those to EU markets in the last quarter but the EU remains our number one trading partner. With fewer than one in five food and drink manufacturers exporting, it is vital that we continue to work closely with Government in order to take advantage of the opportunities to sell Great British and Northern Irish food and drink abroad.”
Elsa Fairbanks, Director, Food & Drink Exports Association (FDEA), added how FDEA members continue to be very positive about their sales to international markets.
“It is particularly encouraging at this time of change that exports continue to grow in our top EU markets and that markets like South Korea and China are gaining traction.”
“Our challenge is to ensure that new exporters have the confidence to develop markets closer to home and the skills and knowledge to explore the important but often complex markets further afield.”
“The FDEA team is committed to helping food and drink exporters identify the most appropriate markets for their products and to exploit the commercial opportunities for British food and drink across the globe.”
