Brexit: UK records “disastrous” £2bn fall in food and drink exports to EU
Figures released by the Food and Drink Federation (FDF) show that although sales of UK food and drink to non-EU countries were up 13% in 2021, sales of UK food and drink are down £2bn compared to pre-Covid levels due to a sharp drop in sales to the EU.
In a statement, the FDF said that sales to Germany, Spain and Italy in the first half of 2021 are each down around 50% compared to the same period in 2019:
A combination of the ongoing impacts of the Covid-19 pandemic, and new barriers to trade resulting from the new trading arrangements, have led to a fall in exports to the EU of more than a quarter since H1 2019. Exports to nearly all EU member states fell significantly, including a loss of more than £0.5bn in sales to Ireland, while sales to Germany, Spain and Italy are each down around a half since H1 2019.
According to the FDF, the UK’s EU imports have also been badly impacted by the pandemic and the new trading relationship. Figures show EU imports falling nearly 15% since 2019 – a loss of £2.4bn.
The trend is likely to continue according to the FDF, who say imports the UK’s imports from the EU are likely to deteriorate further when full border controls are in place in January. Products of animal origin were heavily impacted in the first half of this year, with a large fall in imports of pork (-19.6%), cheese (-17.6%) and chicken (-17.9%).
Reacting to the figures, Dominic Goudie, Head of International Trade, the FDF, said that the loss of sales to the EU was “disastrous”:
“The return to growth in exports to non-EU markets is welcome news, but it doesn’t make up for the disastrous loss of £2bn in sales to the EU. It clearly demonstrates the serious difficulties manufacturers in our industry continue to face and the urgent need for additional specialist support.”
Goudie also expressed concern about the labour shortages the UK is experiencing, and claimed that if no measures are taken, the lack of workers would impact the UK’s ability to export its food and drink:
“At the same time, we are seeing labour shortages across the UK’s farm-to-fork food and drink supply chain, resulting in empty spaces on UK shop shelves, disruptions to deliveries and decreased production. Unless steps are taken to address these issues, the ability of businesses to fulfil vital export orders will be impacted.”
John Whitehead, Food & Drink Exporters Association (FDEA), also welcomed the rise in food and drink exports to the UK, which he described as “welcome”. However, he warned that the UK’s trade deal with the EU was contributing to a fall in exports, as well as businesses moving operations to the European continent:
“There is growing evidence that the complexity of trading with the EU has led to businesses moving operations into Europe and of importers looking for alternative suppliers, contributing to the ongoing decline in both UK exports and UK jobs.”