With continued consolidation in the UK retail sector, Britain’s ‘UK-centric’ food manufacturers are being urged to widen their outlook to overseas markets as a means for growth in 2006.
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This call comes at a time when the UK food and drink export market is experiencing strong growth to both established and emerging markets, up 3.1% to £4.65bn (US$8.2bn) in the first six months of 2005, according to the latest figures from market development consultancy Food from Britain (FFB).
FFB said a large number of food and drink manufacturers are making a strategic mistake by ignoring international opportunities, something that could potentially harm the industry’s long-term growth and profitability.
“Although the UK has a £10bn food and drink export market, we significantly lag behind other European nations such as France and Germany who export twice as much,” said FFB’s chief executive, David McNair. “With the reputation of world-class innovators, the UK food and drink industry needs to shed its ‘island’ mentality and become more competitive on the world stage. Until this happens, we are unlikely to maximise opportunities overseas and significantly grow our exports beyond the current £10bn barrier.”
In the first half, exports to the EU region were up 3.6% to £3.06bn. Ireland continues to be the UK’s number one overseas market, with a growth of 6% in the first six months of the year, while Spain bounced back from a disappointing 2004 with an increase of 12%.
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By GlobalDataThere was also good news for the UK’s farmers as fresh meat exports showed strong signs of recovery, up 16% to £254m. In addition, sales of prepared meats continue to climb (up 15%) to end the half-year at £65m, while beef starts to make in-roads from a small base, up 36% to £12m.
Other product categories performing well include cheese, up 12% to £103m; beer, up 15% to £166m; fresh fruit, up 28% to £51m; and soft drinks, up 20% to £94m.
