Food and drink exporters target growth in non-EU markets
21 November 2016
Exports of branded food and non-alcoholic drinks shot up by 13.7% in the third quarter of 2016, according to new figures from the Food and Drink Federation (FDF). Sales to non-European Union (EU) markets grew at twice the rate of the EU, however, the EU still remains the top destination for branded exports, buying two thirds of the total. This represents the biggest quarterly export sales we have ever seen and builds on Q2, which was in turn the largest up to that point.
The overall value of UK food and non-alcoholic drink exports rose to £3.4bn in Q3, up 12.1% on the same period in 2015. Latest year-to-date figures now show impressive double-digit growth with total exports of £10.1bn during the first three quarters of 2016.
The weaker pound since late 2015 and sharp falls seen post referendum mean that UK exports have become increasingly competitive in recent months. We hope to see a further upswing in exports in the coming months as companies capitalise on these opportunities.
The three export markets which saw the greatest value growth in the year-to-date were Spain, up £158m, China, up £124m and Germany, up £60m. Ireland, France and the Netherlands remain the top three destinations for branded UK food and non-alcoholic drink, buying 42% of total exports. The top three product categories were chocolate, salmon and cheese, with exports of wheat experiencing the largest value growth, up £147.4m (+80.0%) year-to-date 2016, when compared with 2015.
In October, Defra published a new International Action Plan for Food and Drink that sets out how government and the industry will work to create opportunities and increase capability for UK exporters over the next five years. This includes nine priority campaigns across 18 countries targeting additional exports worth £2.9bn.
The plan is a key strand of the Government's Great British Food campaign, which was introduced to celebrate the UK'S food and drink industry, drive growth and jobs in the sector, and establish Britain's reputation as a great food nation.
See more in our exports snapshot
Ian Wright CBE, Director General, FDF, said:
“The growth of food and non-alcoholic drink exports we've seen in Q3 is very encouraging news for our industry. It is also a positive step towards highlighting the excellence of UK food and drink to the world. It is very pleasing to see non-EU exports performing beyond expectations, with UK firms taking advantage of increased competitiveness following the currency changes since the summer.
“As the UK leaves the European Union a growth in exports is hugely important to our sector. We hope that with the determination of businesses, and the assistance of the Government's International Action Plan for Food and Drink, we can open more channels and provide support to new and existing food and drink exporters as they seek new markets overseas.”
Food Minister George Eustice MP, said:
“Whether it's Scottish salmon or Wensleydale cheese, the global appetite for the British brand is showing no sign of slowing. These latest figures are welcome news for our food and drink businesses and for an industry that's at the heart of our economy.
“We will build on this success through our new action plan, which will boost food and drink exports and help even more exporters grasp the opportunities our worldwide reputation brings.”
Elsa Fairbanks, Director, FDEA, said:
“The FDEA is very encouraged by these figures which reflect our experiences both among our members and also buyers around the world. We must also remember that EU markets still represented 71.5% of UK food and non-alcoholic drink exports in Q3 2016, and this should be borne in mind as we leave the EU.
In our experience, EU retail and foodservice buyers are very positive about the quality and innovation behind UK products and stress to us the importance of maintaining close links going forward”.
Export case study
In 2015, export accounted for 21% of total sales, they forecast this figure to reach 30% by 2018. Since the summer, Joe & Seph's have seen some positive uplift in export sales. In France for example, the weaker pound has resulted in a lower RRP which has increased sales. Likewise, it has also helped open new markets that were previously prohibitively expensive to export to (due to higher shipping costs and distributor margins), such as Iceland where they launched in to 8 Hag Kaup stores, which is forecast to drive significant incremental revenue for the business.
Note to editors
- The overall value of UK food and non-alcoholic drink exports rose to £3.4bn in the third quarter of 2016, up 12.1% on the same period in 2015.
- During Q3, exports of branded food and non-alcoholic drink that consumers know and love increased by 13.7% to £1.3bn. Exports to the EU were up by 10.4% and to non-EU countries by 20.8%.
- The branded food and drink category represents quality, value-added products that are known and loved by UK consumers and produced by the UK's food and drink manufacturing industry. 96% of these manufacturers are small and medium sized enterprises (SMEs).
- The Food and Drink Federation (FDF) is the voice of the food and drink manufacturing industry – the UK's largest manufacturing sector. For more information about FDF and the industry we represent.
- FDEA is a trade association dedicated to UK food and drink exporters representing the industry at international trade shows and providing a network of support to assist companies internationally.
- View more about our export case study.
More information
Contact FDF press office for a photo or further information via 0207 420 7118
Contact Matthew Evans, Corporate Affairs Division, at: Matthew.Evans@fdf.org.uk, or (0) 20 7420 7152.
