Food & drink exports take a tumble
7 Sep 2015
The value of UK food and non-alcoholic drink exports fell by 5.3% to £6bn in the first half of this year, compared with the same period in 2014.
The figures released by the Food and Drink Federation (FDF) also revealed that the value of exports to the EU had shrunk by 7.5% in the first half.
It said the strength of the pound against the sharply depreciated Euro was chiefly responsible for the falls, making UK exports less competitive in key Eurozone markets.
We are starting to see the negative effect of exchange rates, particularly in Eurozone which remains the key destination for UK food and non-alcoholic drink exports
Steve Barnes, FDF commercial services director
“Food and drink has been bucking the trend when it comes to exports for years and the value of the sector’s exports is still declining less than UK exports overall,” said Steve Barnes, FDF’s economics & commercial services director.
“However, we are starting to see the negative effect of exchange rates, particularly in Eurozone which remains the key destination for UK food and non-alcoholic drink exports.”
Exports to non-EU markets did continue to grow by 1%, and value-added goods were up globally, the FDF said.
This was boosted by significant increases in exports of tomato ketchup and bread, pastry & cakes. Confectionery exports to Canada also rose by £7m.
While dairy exports experienced losses of £157m compared with record highs in the same period last year, exports remained above pre-2014 levels owing to rising exports of both processed and unprocessed milk and cream.
However fish and seafood exports lost £137m in value, largely as a result of a sharp fall in salmon exports, reported the FDF.
Including alcoholic drinks, total food and drink exports for the first half were down 4.8% on 2014, and totalled £8.6bn. Exports of whisky - the UK’s largest food and drink export - also fell 4.3% during the period to total £1.7bn.
“The good news is that volumes in many categories are still up and exports of value added goods to both EU and to non-EU countries are rising,” said Elsa Fairbanks, director of the Food & Drink Exporters Association.
“Our latest export survey revealed that although the strength of sterling is a growing concern, FDEA members continue to see growth potential across Asia and the Middle East as well as established markets in North America and the EU. Success is coming both from traditional products like cheddar cheese (up £20 million globally) and innovative products in the health and wellbeing categories.”
The FDF, FDEA and online export community Open to Export have launched a joint educational initiative this week for manufacturers seeking information on markets offering the best opportunities in the current economic climate.
Running from 7 – 22 September, The Food & Drink Export initiative will include webinars and expert advice on currency issues, trade shows and niche markets, and present case studies from successful exporters.
