Britain’s food and drink exports has achieved its biggest first quarter value on record after reaching £5.8 billion, almost twice last year’s growth rate, analysis from the Food and Drink Federation (FDF) shows.
Within that, Q1 2019 food and drink export growth to non-EU markets (+12.2%) outpaced growth to EU markets (+9.9%). This was also the case for exports of branded goods.
Growth of more than 20% was recorded in six of the UK’s top 20 food and drink export markets, with Japan recording the highest growth rate at 52.5%.
Exports of all of the top 10 products increased by value in Q1 2019, the strongest being salmon with growth of 40.9%.
Over the past 10 years, UK branded goods exports have increased by 110%.
In Q1 2019, exports to the Netherlands (13.5%) grew the quickest out of the top five markets for branded goods. FDF’s industry ambition is to grow exports of branded food and non-alcoholic drink by a third, from a 2014 baseline, to reach £6bn by 2020.
Brexit uncertainty
While Q1 exports have shown positive results, feedback received by FDF from businesses at recent trade fairs shows that key buyers in some of the top 20 markets are no longer willing to buy from UK exporters due to ongoing Brexit uncertainty.
This could have a significant impact on food and drink export figures later in 2019.
In January 2018, the Food and Drink Sector Council was established as a formal industry partnership with Government created to improve the productivity and sustainability of the UK food and drink industry.
Exports are among the Council’s key priority areas, with working groups set up to drive activities and policy recommendations in these areas.
Saudi Arabia moves on up
Through the Food and Drink Sector Deal, five target markets (China, the Gulf region, the USA, Japan, and India) have been identified as offering significant growth potential for UK food and drink.
Sales to Saudi Arabia rose by 198% from Q1 2009 to Q1 2019. Between January and March 2019, exports grew by 28.6%, moving the country into the UK’s top 20 exports markets.
Saudi Arabia was also the 11th biggest buyer of UK branded goods, recording growth of 82%, driven by exports of breakfast cereals, chocolate and sweet biscuits.
The top five UK products sold to Saudi Arabia in Q1 were oats, breakfast cereals, chocolate, sweet biscuits and eggs. Three-digit growth was recorded in nine of the top 20 UK export products sold to Saudi Arabia, including sugar (+3,782%).
“The food and drink industry continues to out-perform expectations, delivering another quarter of exceptional exports growth despite the damaging uncertainty with which businesses have to contend,” said FDF Chief Executive Ian Wright.
“The rapid growth to Saudi Arabia, a key target market in FDF’s Food and Drink Sector Deal proposals, is just one example of this strength. With the right support in place our industry could deliver so much more.
“We urge Government to co-invest in our Sector Deal proposals and help us to provide the support our industry urgently needs to further enhance this growth.”
