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March 18, 2013

EXCLUSIVE: UK: Heath: Food industry “playing catch up on emerging markets”

The UK food sector is behind its rivals in exploiting the growth in emerging markets, food minister David Heath has told just-food.

By Dean Best

The UK food sector is behind its rivals in exploiting the growth in emerging markets, food minister David Heath has told just-food.

Speaking at the IFE exhibition in London, Heath said the industry needed to make up ground in markets like Asia.

“There is huge potential there and in some sectors we’ve got a little bit of catching up to do,” he said. “Dairying is very close to my heart. We’ve for a long time assumed that the Far East does not import dairy products. Now we see this massive expansion of the market. They are interested in what Europe has to offer, our rivals are going after it and we need to do so, too.”

According to the latest government data, the UK food and soft drink sector has had some success in emerging markets but has seen sales fall in others.

Shipments to Brazil and China increased in 2012, although sales in Russia and India fell last year. None of the BRIC countries were in the top 20 markets for UK food and soft drink exports last year.

Heath insisted the UK government was supporting the industry in its attempts to boost sales in the BRIC markets. “It is a key area. The Secretary of State has been to China and is going again very shortly. We’ve got a lot of UK Trade & Investment work going on there and we’ve succeeded in opening up to an extent the Chinese and Russian markets. We’ve had the PM leading delegations to India and working there,” he said.

Since promotional body Food From Britain was wound up in 2009 following the end of government funding, there have been concerns that UK food manufacturers have not had adequate support to expand overseas in comparison to competitors in other countries.

Earlier at IFE, Heath said the Government is helping SMEs try to break into overseas markets, which he said could be “daunting” for smaller companies. “A lot of people are put off from purusing what could be a valuable opportunity because it is too hot to handle in a way,” he told a conference at the event. “There are a variety of things we are doing and we can be doing. UKTI provides contacts and support in getting certification for instance.”

However, the minister said financial support from government may not be readily available. “It won’t always be in the form of cash handouts because that’s not something the Government has many opportunities to do at the moment. What we’ve got to do is find a different ways of providing support.”

Heath said larger companies could help their smaller peers in boosting their presence internationally. “Big companies are very happy very often to share their expertise,” he claimed. “If we can get every SME the opportunity to grow, we can transform not just the food economy but the national economy as well. There is huge percentage growth available there in a way that is not available for very large companies.”

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