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Record growth for UK food and drink exports

03 June 2017

first quarter of 2017 saw exports of all UK food and drink grow to £4.9bn, up 8.3% on 2016, according to figures from the Food and Drink Federation (FDF). This represents the largest first quarter exports value on record. 

The UK's top three export products stay the same – whisky, salmon and chocolate. Export growth to non-EU countries (+9.4%) increased at a faster rate than those to the EU (+7.4%).
 
Ireland, France and the United States are the top three destinations for UK food and drink in terms of overall value. Positive growth was reported in all top 20 markets, apart from Spain, which saw a 21.6% decrease compared with 2016.
 
The three export markets that saw the greatest percentage growth in value in Q1 were South Korea (+40.3%), Belgium (+37.3%), and South Africa (+31.2%). 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 export figures to South Africa.
 
Exports of salmon saw the largest value growth, up 52.3% in Q1, with wine experiencing the largest increase in terms of export volume, up 13.8%.
 
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% to -£6.2bn in Q1 2017. The impact of weaker sterling on British exports is expected to be seen in Q3 2017 as companies negotiate new sales agreements with overseas buyers.
 
At present only 20% of food and drink manufacturers actively export. The FDF is hoping to work in partnership with Government to scale-up its provision of specialist export support in food and drink. Ian Wright CBE, director general at the FDF, said: “The growth of food and alcoholic drink exports 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.”


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