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Pandemic hits food and drink exports but non-EU sales of branded goods grow

27 May 2020

The Food and Drink Federation (FDF) has today published analysis showing that in the first quarter of 2020, food and drink exports fell by over £700m (-12.7%) compared to the same period in 2019. Sales to the EU were hit the hardest, with total value falling by 17.4% compared to 2019.

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FDF has issued the following press notice:

  • Q1 exports of food and drink fell by over £700m (-12.7%) to £5.1bn compared to the same period in 2019.

  • Sales to EU countries were the hardest hit, with the total value falling by 17.4% to £3.1bn, largely driven by the immediate impacts of COVID-19, and subsequently the closure of the hospitality sector.

  • Sales to the majority of the UK's top markets declined, and the share of exports to the EU fell in Q1 2020 - both for branded and for all food and drink.

  • However, almost one third of branded UK food and drink exports now go to non-EU countries, a 4.5 percentage point (pp) increase on Q1 2019. The US, Australia and China all maintained demand for UK branded food and drink.

  • Additional specialist support is urgently needed to help UK food and drink exporters quickly adapt to changing global consumer demand and make an important contribution to the UK's economic recovery and the levelling up agenda.

The Food and Drink Federation (FDF) has today published analysis showing that in the first quarter of 2020, food and drink exports fell by over £700m (-12.7%) compared to the same period in 2019. Sales to the EU were hit the hardest, with total value falling by 17.4% compared to 2019. This decrease was largely driven by the immediate impacts of COVID-19, including the closure of hospitality and travel sectors, which has meant a loss of sales into restaurants, cafés, bars and the out-of-home sector across Europe.

While sales to the majority of the UK's top markets declined, demand has been more resilient from others nations, including Singapore, Canada and Norway, which each saw sales growth of more than 10%. Declines were reported among the UK's top ten products, with whisky, chocolate, cheese, salmon and gin seeing export value drops of over £20m in Q1. Pork, which saw an increase in value, and beef and vegetables, which saw volume increases, were exceptions to this.

The first quarter of the year also saw a fall in the value of branded food and non-alcoholic drinks exports of 9.1%. Sales to all EU nations among the UK's top ten branded goods export markets decreased in Q1 2020; almost one third of branded exports are now going to non-EU countries, a 4.5pp increase on Q1 2019.

US, Australia and China show increased demand for UK branded food and drink

Branded exports to Australia increased by 3.5% in Q1 2020, driven by a rise in sales of cakes and baked goods, including tarts, pastries, wafers, pizzas and quiches, which saw a 12% increase on Q1 2019. Increased sales of beer and soft drinks helped drive growth to the US by 6.9%, while exports of gin, infant food and bottled water saw the value of exports to China rise to £34m in Q1.

Export Support

The Q1 figures demonstrate the initial impacts of COVID-19, especially within markets that first experienced the pandemic, such as China, or those most affected, including many of our key EU trade partners. Exports of UK food and drink have a critical role to play in supporting the sector, during these challenging times, and driving the UK's wider economic recovery. To achieve this, it is important that industry and Government work in close partnership through the Food and Drink Sector Council to address critical gaps in sector-specific export support that is urgently required.

Dominic Goudie, Head of International Trade, FDF said:

“Manufacturers and the other hidden heroes working across the supply chain have ensured continued access to essential food and drink for UK shoppers during this crisis. But we can now see how COVID-19 has impacted valuable overseas sales of UK food and drink that were worth over £23 billion in 2019.

“The closure of the hospitality sector in high-value export markets in the EU and further afield has been devastating for many exporters. However, we can also see that opportunities do remain in retail channels in many markets.

“Ensuring a quick return to growth will be essential to support resilience in our industry and also the UK's economic recovery. We are working closely with Government and industry partners to set out a recovery plan that will deliver a return to sustainable export growth right across the UK.

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