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UK exports to EU see a significant drop in first quarter

Iain HoeyBy Iain HoeyJune 18, 20213 Mins Read
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Exports of food and drink from the UK to the EU in the first quarter of 2021, fell 47% compared with Q1 2020, as a result of the on-going impacts of Covid-19 and changes in the UK’s trading relationships, according to the Food and Drink Federation (FDF).

Sales to non-EU nations accounted for 55% of all UK food and drink exports, with exports to the EU having fallen by £2bn compared with Q1 2019. Exports to almost all EU Member States fell significantly.

Exports to the Republic of Ireland, traditionally the sector’s biggest export market, were down 71% at just £281m, compared to £961m in Q1 2020. Meanwhile sales to Germany, Spain and Italy declined by more than half since Q1 2020.

.Whilst overall pork exports were up on Q1 of 2019 by 5.4%, they were down by 14.8% compared to Q1 of 2020.

Looking at exports to Asia, the picture is a little brighter as there have been a return to growth in exports to East Asia, where there has been high demand for quality UK food and drink.

In Q1 2021, exports to China (+28.2%), Hong Kong (+3.7%), Japan (+6.2%) and South Korea (+18.5%) were all above the levels seen in Q1 2020. The UK’s top three non-EU markets, US (11%), China (5%) and Singapore (3%), now account for 19% of the UK’s total exports, a figure of £713m.

UK imports from the EU were also down 10%, driven by a number of factors including the continued closure of the UK’s hospitality sector, stockpiling in late 2020, reduced demand for ingredients as a result of the decline in exports to the EU, and import substitution. The FDF predicts that this fall will increase when full checks are implemented at UK borders in 2022.

Of the UK’s top 10 products imported from the EU from 2019 to 2021, vegetables dropped 13.9%, wine 20%, and fruit 15.7%. Products of animal original were also heavily impacted, with large falls in imports of EU pork, cheese, chicken and beef.

Dominic Goudie, head of international trade at the FDF, said: “The loss of £2bn 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, from the 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.”

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