Sales of food and drink from the UK to the EU fell by 47% in Q1 2021 compared with the same period last year, the Food and Drink Federation (FDF) reports.
Exports to the EU have fallen by £2 billion compared with the first quarter of 2019, with all of the UK’s top ten products exported to the EU falling significantly in value. Chocolate exports dropped by 36.9%, while lamb and mutton fell 14.3%. Dairy products have been the most impacted, with exports of cheese decreased by two-thirds compared to 2020.
The FDF attributed the drops to the ongoing impacts of the Covid-19 pandemic and changes in the UK’s trading relationships.
Sales to nearly all EU member states fell significantly in the last quarter. Exports to Ireland dropped by more than two thirds and sales to Germany, Spain and Italy were down more than 50% since Q1 2020.
UK imports from the EU were also down 10%, due to the UK’s hospitality closures, reduced demand for ingredients, stockpiling in late 2020 and import substitution. The FDF predicts the fall will increase when full checks at UK borders come into force next year.
There has been a return to strong growth in exports to East Asia in Q1 2021, with exports to China, Hong Kong, Japan and South Korea all above levels seen in Q1 2020. The UK’s top three non-EU markets – the US (11%), China (5%) and Singapore (3%) – now account for 19% of the UK’s total exports, at £713 million.
“Disaster for our industry”
Dominic Goudie, head of international trade at the FDF, said: “The loss of £2 billion of exports to the EU is a disaster for our industry, and is a very clear indication of the scale of losses that UK manufacturers face in the longer-term due to new trade barriers with the EU.
“We set out a plan to mitigate these impacts by boosting support for exporters, and this was backed by the Trade and Agriculture Commission. The Government must stop prevaricating and get behind these proposals to help exporters that have been shut out of trading with the EU.”
John Whitehead, Food & Drink Exporters Association (FDEA), said: “Whilst some of this large drop can be put down to end of year stockpiling, significant business has been lost as a direct result of the additional bureaucracy, customs delays and costs of trading with the EU.
“Experienced FDEA members are continuing to battle against inconsistent interpretations of regulations across the EU and having to weigh up whether the time and cost involved is sustainable. We fully support the FDF in pressing Government to boost support for exporters.”