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June 1, 2022

UK food and drink exports to Europe lagging behind other regions – industry data

The UK’s Food and Drink Federation (FDF) revealed that exports to Europe were down 17.3% over the period 2019-2022.

By Andy Coyne

UK food and drink exports to Europe were down markedly in the first quarter compared to pre-pandemic levels, research shows.

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The food and grocery sector thrived during the pandemic, largely due to the shutdown of the food service industry and the sector’s subsequent necessity, panic-induced bulk purchasing, and spending more time at home. The market has grown as a result of inflation. Consumer unwillingness to go out and socialize, and the reopening of several hospitality facilities, helped maintain the demand for groceries, particularly online, in 2021. As consumer behavior changes, we consume more food and drink at home, and inflation increases basket sizes. GlobalData predicts that the sector will continue to hold a higher share than had been predicted prior to the pandemic. This is true despite the fact that the food and grocery sector's share of overall retail will decline from its peak in 2020. This report will discuss market forecasts and key themes in the global food & grocery industry in 2022 and beyond. It covers:
  • Market drivers and inhibitors
  • Five-year forecasts and the impact of COVID-19
  • The performance of the online channel versus offline
  • Major trends in the market including rapid delivery, ambient retailing, supply chain disruption, and inflation
Assess developments within this sector to help your business thrive in 2022 and beyond.
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Figures released by the UK’s Food and Drink Federation (FDF) showed exports to Europe were GBP3bn (US$3.77bn) in the first quarter of 2022, up 45% year-on-year but down 17.3% when compared to the opening three months of 2019. The UK left the EU in January 2020.

The large increase over last year’s figure is, says the FDF, due to a “sharp drop” in sales in the first quarter of 2021 due to stockpiling and the “need of businesses to adapt to new trading requirements with the EU”.

But the longer-term decline in trading with the bloc – by far the UK’s largest trading partner – remains an area of concern.

The FDF said: “A key priority for our sector remains improving the implementation of the UK-EU trade agreement.”

More positive is the overall export figure of GBP5.3bn, up 30.8% year-on-year in the first quarter, with shipments of items such as fish and bakery ingredients to Canada and India helping drive exports to non-EU countries. Shipments to Canada rose by more than a quarter compared to the pre-pandemic period while shipments to India rose by more than a fifth.

The FDF’s figures also revealed exports to the US, Australia, Japan and the UAE were also higher than pre-pandemic levels.

Overall, total exports were down 7% in the opening three months of 2022 compared to the first quarter of 2019.

Dominic Goudie, the FDF’s head of international trade, said: “Trade plays a key role in boosting the UK economy, with high exports ensuring food and drink companies can thrive and imports offering shoppers in the UK a wide range of quality products at prices they can afford.

“This is particularly important now, at a time of soaring costs to businesses and consumers, that the UK utilises trade as a deflationary weapon.”

Food and drink imports were more than 13% higher in the first quarter than in the corresponding period of 2019.

However, the FDF added a note of caution. “One unknown remains the impact of the war in Ukraine, where we are seeing energy prices rise and supplies of certain key ingredients – including vegetable oils, cereals and white fish – being strained, all of which are vital for many of our importers.”

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Free Report
img

What’s the forecast for the food and grocery industry?

The food and grocery sector thrived during the pandemic, largely due to the shutdown of the food service industry and the sector’s subsequent necessity, panic-induced bulk purchasing, and spending more time at home. The market has grown as a result of inflation. Consumer unwillingness to go out and socialize, and the reopening of several hospitality facilities, helped maintain the demand for groceries, particularly online, in 2021. As consumer behavior changes, we consume more food and drink at home, and inflation increases basket sizes. GlobalData predicts that the sector will continue to hold a higher share than had been predicted prior to the pandemic. This is true despite the fact that the food and grocery sector's share of overall retail will decline from its peak in 2020. This report will discuss market forecasts and key themes in the global food & grocery industry in 2022 and beyond. It covers:
  • Market drivers and inhibitors
  • Five-year forecasts and the impact of COVID-19
  • The performance of the online channel versus offline
  • Major trends in the market including rapid delivery, ambient retailing, supply chain disruption, and inflation
Assess developments within this sector to help your business thrive in 2022 and beyond.
by GlobalData
Enter your details here to receive your free Report.

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