While Sterling’s fall in value has led to higher prices in supermarkets, it appears that UK food manufacturers are benefitting from their products being more competitive abroad, latest figures show.
The Food and Drink Federation (FDF) states that exports of all UK food & drink grew 14.7% to £5.9bn in third quarter of this year 2017, building on the strength of the record-breaking first half results seen earlier this year.
This represents growth of 11% to £16.1bn from January to September 2017 year-to-date compared to 2016.
From January to September, Ireland, France and the US remained the top three destinations for UK food and drink in terms of overall value.
The US remains the UK’s top non-EU market for exports of food and drink, reaching £1.6bn, up 7.7%. Growth was reported in all top 20 markets during that time period, apart from Spain, which saw a 7.1% decrease due to reduced sales of barley and wheat (-78%).
The balance between exports to non-EU and EU markets shifted slightly in the third quarter, with growth to non-EU markets (+18.2%) out-performing EU markets (+12.5%).
There has been notably rapid growth in the sector’s exports to the Philippines (+289.1%), Latvia (+116.1%), and Iceland (+73.2%).
The surge in growth to the Philippines was led by higher demand for pork (85%), whisky (277%), cheese (1608%) and salmon (226%), while exports to Latvia more than doubled from £60m to £129m, driven by sales of whisky (131%), wine (239%), gin (86%) and fish fillets (125%).
Exports of branded products grew by 14.3% in Q3, reaching £1.5bn, and up 12.7% to £4.3bn for the first nine months of the year.
The FDF said this branded export growth is firmly on track to reach its export ambition ahead of schedule.
In 2015, FDF set a target to grow exports of branded food and non-alcoholic drink by a third, from a 2014 baseline, reaching £6bn by 2020.
Despite the growth recorded, the UK’s food and drink trade deficit increased by 0.7% to -£5.6bn in Q3 2017 as our trade deficit with EU countries widened.
Ian Wright, director general of FDF, commented: “The continued growth of food and drink exports demonstrates the strength of UK production in international markets.
“UK food and drink is recognised throughout the world for its quality and we must be ready to take advantage of the opportunities created from leaving the EU.
“Exports to non-EU markets did outperform those to EU markets in the last quarter but the EU remains our number one trading partner.
“With fewer than one in five food and drink manufacturers exporting, it is vital that we continue to work closely with Government in order to take advantage of the opportunities to sell Great British and Northern Irish food and drink abroad.”